If you are a business who accepts credit and debit card payments, a merchant cash advance could offer you a quick and easy short-term, unsecured funding solution. A business funding solution that enables you to access finance equalling your average monthly turnover of card transactions with no upfront fees or fixed term arrangements.
The amount you can borrow ranges from £2,500 to £300,000, to which you agree a manageable cost tailored to suit your business. Repayments are taken automatically via your card terminal as a proportion of your revenue, making it a hassle-free finance solution for businesses with a good volume of card transactions. You can use the advance to pay for many business activities, such as stock purchases, refurbishments, marketing, bills and more.
The great news for busy business owners is that the product does not create additional admin nor require special equipment. There is no need to change your PDQ terminal or current card machine processor. A fixed percentage of future card transactions is taken automatically at the time of sale to repay the lender. These repayments typically range from 10 per cent to 25 per cent of a card transaction.
If your repayment fee is 10 per cent and a customer spends £100 with you on their credit card, £90 will be credited to you and £10 will be sent to repay your cash advance. You will usually receive the credit of sale within three days. A merchant cash advance otherwise known as a business cash advance is not classed as a loan; you are simply borrowing from a portion of future card sales.
As there are no fixed monthly payment terms, you only repay the advance when a card transaction is made, so you won’t have to worry about penalties. It is unsecured too which means you won’t need to use an asset such as a property to secure against the borrowing. When business is booming, you will pay off more of your advance and enjoy peace of mind during quieter times when you pay back less.
If you’re thinking about a merchant cash advance, you can check your eligibility at www.merchantloanadvance.co.uk.