Buyer Guide to Learn About a Business Cash Advance

Merchant or business cash advance, sometimes called a “business cash advance loan” is an alternative option to traditional loans for business owners.  Alternative options like factoring loans and merchant cash advance are viable methods of financing your business operations if you need cash quickly and don’t have the time to wait for a loan approval, or if you are unable to obtain a traditional loan. 

The application process is fairly quick- usually only a couple of days, and a business can usually obtain a large infusion of cash within a week of being approved.  Payments against the balance of the advance are taken automatically from the “borrowers” daily credit card revenue, and begin immediately upon disbursement of the cash payment.

In a cash advance transaction, a business “sells” a portion of future revenues in exchange for cash.  These advances have been compared to “payday loans,” where a cash payment is given in exchange for a post-dated check.  Business cash advances oftentimes provide flexibility and relaxed approval standards to business executives and owners. Although they are more expensive and require faster repayment than traditional loans, merchant cash advance is becoming more and more popular with business owners. These sales transactions provide an easier option to manage cash flow in times of need and provide the alternative financing options businesses seek.

In this guide, we’ll look at the in’s and out’s of merchant cash advance providing you with the information you need to make an informed purchasing decision.

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