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If you’re looking for a short-term solution for your company’s money worries, a merchant cash advance could be just what you need.

Managing your cash flow when you’re running a business isn’t always easy. Quieter months, late-paying clients, and unexpected expenses can wreak havoc on your bank balance.

All businesses struggle financially at some point. However, these days there is a lot of financial help available. For example, if you’re looking for a short-term solution for your company’s money worries, a merchant cash advance could be just what you need.

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What Is a Merchant Cash Advance?

Fairly new onto the business finance scene, a merchant cash advance is a short-term finance solution. This is designed as an alternative to a traditional loan, offering a line of funding which is based upon the company’s monthly debit and credit card sales.

Therefore, this type of financing is only suitable for businesses that take a lot of their income from credit and debit card transactions. The amount you can borrow will depend upon how well the business is doing. Most lenders will provide anything from £2500, to £300,000 depending upon your turnover. 

How Does It Work?

Once you’ve received your cash advance, you’ll repay it every time you make a sale. That’s because a set percentage of your income will be taken with each payment you receive. There will usually be a minimum amount you’ll be required to pay back each month, too.

If you don’t make the minimum amount in sales throughout the month, you’ll still be required to pay the minimum. Therefore, before taking this type of financing out, you need to make sure you’ll comfortably be able to afford the minimum monthly repayments. 

What Are the Benefits?

Merchant cash advances can provide a lot of benefits to businesses. The main ones include:

  • It doesn’t affect your credit rating
  • You’ll have affordable repayments
  • It can help to better manage cash flow
  • You can use the funds to expand your business
  • You’ll get fast access to the funds you need

The fact that merchant cash advances don’t usually go onto your credit report is a major advantage. The repayments are also usually really affordable, enabling you to afford them even during quieter months. Plus, you can use them to better manage your cash flow, or even to help the business grow.

You’ll be provided with a lump sum quite quickly. There’s no paperwork to fill out and funds are usually placed into your bank within a few days’ time. Due to how flexible and affordable this type of finance is, it’s not hard to see why they’re overtaking business loans in popularity.

A Merchant Cash Advance Could Help Your Business

If your business is temporarily struggling, or you’re desperate to push it forward, a merchant cash advance could be the answer. The above are just some of the benefits you could experience from an affordable cash advance.