Borrowing Money for Your Business Through a Merchant Cash Advance

How Well Do You Know Merchant Cash Advances?If you are a small business owner that is just getting started or a seasoned business owner that is in need of some additional cash, you may be interested in taking out a merchant cash advance. These types of cash advances are ideal for small business owners, as they are easy to obtain and easy to pay back. Basically when you take out a cash advance as a merchant, you are borrowing against future debit and credit card transactions.

You are given a specific amount of time to pay the advance back, and in most cases, payments are simply deducted from the daily credit card and debit card income.While the most common option used when it comes to paying the advance back is by splitting credit card sales or deducting via ACH debit, business owners also have the option of utilizing a trust account that is set up by the financing company. Trust accounts are not used often simply due to the fact that with ACH and credit card splitting, the funds are available right away.

Merchant cash advances are not legally considered loans, they are actually an arrangement made between the business owner and the funding company. The funding company is basically purchasing a portion of your future sales, so it is definitely a win-win situation for both parties.

Your cash advance can be used to purchase goods and supplies for your company, take care of monthly bills and expenses, or put away as emergency funds. Many businesses find themselves low on resources when they are just starting out, and in today’s economy, even businesses that have been around for a lengthy period of time can easily find themselves in a cash crunch. By taking out a cash advance as a merchant, you are taking a responsible step towards the future success of your business.

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