Merchant Cash Advance

Raise A Loan Based On Your Card Terminal Receipts.

What is a Merchant Cash Advance?

A Merchant Cash Advance is a form of business financing where a company receives a lump sum amount in exchange for a percentage of future credit card sales. Unlike traditional loans, MCAs don’t have fixed repayment schedules, making them a flexible option for businesses with fluctuating revenues.

How Does an MCA Work?

Merchant Cash Advances are unique in their repayment structure. Interest is fixed and added to the amount borrowed. A business then agrees to repay the advance through a fixed percentage of daily or weekly credit card sales. This means during peak sales, repayments are higher, and during slower periods, they are lower, providing cash flow flexibility. And as the interest is fixed at the start there is no penalty if it takes longer to pay it back.

Pros and Cons of MCAs

Pros:

• Quick Access to Funds: MCAs offer fast access to capital, often within days.
• No Collateral Required: Businesses don’t need to provide assets as security.
• Flexible Repayments: Repayments align with your sales, aiding cash flow management.

Cons:

• Higher Costs: Merchant Cash Advances can be more expensive compared to traditional financing.
• Impact on Cash Flow: Daily or weekly deductions might strain cash flow during slow periods.
• Not Suitable for All: Businesses without consistent card sales might find MCAs challenging.

For more information on Merchant Cash Advance - Raise A Loan Based On Your Card Terminal Receipts talk to Equipment Leasing Solutions Ltd