What is a Merchant Advance?

By definition a merchant cash advance is the purchase of future credit card receivables. More simply, you can receive funding now based on your future credit card sales. Merchant cash advances are not considered a loan. Why is this important? The money you are advanced stays off your credit report so there is no credit or no collateral at stake. And, because a merchant advance is a form of revenue based collections your cash on hand is not depleted if you have a bad month.

Features & Benefits

As a business owner there are plenty of ways for you to expand your business with a loan or an advance. Maybe you need to make payroll or grow inventory. Maybe you need new equipment or more supplies. Or, maybe you want to take the next step and open another location. Quite often you may not want to do these things through a traditional loan because you do not want it to affect your business debt to income ratio.

  • easy application process
  • repayment is based on a percentage of credit sales not a fixed monthly amount
  • no collateral required
  • perfect credit not needed
  • high approval rate

Common Uses

A merchant cash advance comes with little to no restrictions for which money advanced can be used. On the contrary, a traditional bank loan may restrict you to use the money on certain things like equipment or payroll. In our experience merchant cash advances are typically used for the following:

  • marketing and advertising
  • purchasing new equipment
  • paying bills or making payroll
  • opening additional locations
  • venturing into new markets