Small and medium-sized companies face difficulty in getting the financing they need to execute their business operations successfully. When dealing with the traditional banks and other major financial institutions where the “one-size-fits-all” mentality exists, obtaining a business loan to meet financial needs is troublesome. The good news is alternative financing such as merchant cash advances come to their rescue and help them obtain business loans in a much easier way.
The lingering repercussions caused by the great recession are still affecting businesses throughout the world. Getting a loan from traditional banks is still a challenge for the business owner, especially of a smaller companies. Owing to their bad credit ratings or no credit, the banks cease to fund many businesses which induces the owners to look for alternative financing such as merchant cash advances. So, this alternative financing is increasingly gaining popularity among business owners. And, getting a quality ACH leads list is an ideal way to identify your potential customers and then target them effectively.
During times of stagnant growth, traditional banks avoid lending to small businesses, especially those having low or poor credit ratings. Though it may seem a troublesome situation for business owners, it has opened up opportunities for alternative lenders that offer merchant cash advances. A smooth flow of cash is vital to running a business successfully and merchant cash advances come out to be the best funding alternative.
When running a business, whether a manufacturing unit or service company, the most crucial part of operating it successfully is having a smooth flow of cash or working capital. But, from where does this capital come? One of the biggest decisions a business owner faces is how and where to obtain additional capital during lean times. Moreover, all the businesses listed under UCC leads need a lot of capital to launch their ventures.
The recent recession has not only destabilized the economy but has brought about a number of changes that are still affecting businesses throughout the world, especially startups and small firms. During the economic crisis, the banks and traditional loan providers have ceased to fund small businesses and startups, owing to their bad credit ratings. For this reason, businesses are looking for alternate financing options to maintain a constant flow of cash and meet their everyday expenses.
In the present economic scenario, the traditional banks have ceased to fund small businesses owing to their bad credit history during the recent recession. Merchant Cash Advances have emerged as the ultimate financing option for these developing companies. More and more businesses are considering merchant cash advance to fund their business operations such as paying wages, buying new equipment and merchandise, etc.
If you are working in the Merchant Cash Advance industry you are quite aware of the importance of buying fresh UCC lists. As you all know, buying UCC leads lists is always a wiser option than searching for them yourself. Getting fresh up-to-date UCC lists comes with its own advantages. UCC leads lists are records containing important information such as name, phone numbers, city, address, etc. of the businesses that have previously received a merchant cash advance and expect to seek them again.
Those who are working in the merchant cash advance industry are quite aware of the importance of building clients and encouraging them to acquire MCA loans. For businesses, finding prospective clients and targeting them is relatively easy—you know who to target and how to reach them. However, the merchant cash advance industry is completely different. When it comes to searching for new merchant cash advance leads, you need to look for a reliable and beneficial source such as UCC lists.
While gigantic companies and multinational corporations seek credit for special operations, small businesses, the ones who have just entered the corporate world, are short of finances and need capital to fund their day-to-day operations. In the starting phase of a business, there are so many things that are needed, such as inventory, hiring staff, technology, etc. Entrepreneurs know how difficult it is to manage the expenses and operate a business with low funds. Also, they need cash to make payroll, pay taxes, or avoid defaulting on existing debt obligations.
Every company, whether it is in construction or is a clothing merchant, in its starting phase needs financial support to grow and maintain their business. Usually, the companies seek funds from loan providers to meet their business operations. The flexibility granted by a loan or cash advance can mean the difference between thriving in a tough economy and joining the half of small businesses that fail during the first five years.
For this reason, business owners really need to know what would be the best funding option for them. The two major funding options for small businesses are SBA loans and Merchant Cash Advances or MCAs. SBA loans are loans to small businesses who are unable to get a business loan through normal lending channels, with reasonable terms. The program operates through private-sector lenders that provide business loans which are guaranteed by the SBA or the Small Business Administration. A merchant cash advance is a quick and easy business funding option without the need for collateral. The MCA loans require no formalities, no credit checks, and are provided by private lenders. There is no involvement from any bank or other traditional loan providers.
SBA vs. MCA – Picking the Better Option
Still, many people are confused on which is the better option. Let’s make a comparison between the two and see which will work best for you.
Based on financing amounts, SBA loans offer numerous benefits. For organizations that need a few million dollars quickly, an SBA can be their best option. The approval time is around one week, and disbursement takes up to six weeks. The organization’s lending standards favor manufacturers with equipment and property as collateral. Now, merchant cash advances can start from $10,000 and can go up to $51 million. With merchant cash advances, business owners can access funds within a week and even within 72 hours in certain cases.
The next important comparison criterion is what the minimum qualification to apply for a loan is. When applying for an SBA loan, the applicant must meet a lengthy list of terms and conditions and even additional ones that have been set by the originating bank. For instance, an applicant,
- Must base for-profit operations in the US
- Cannot request government help before using up personal assets
- Cannot be involved in certain financial, political, or religious activities
- Cannot be delinquent on taxes or any other debts to the federal government
However, merchant cash advances do not require collateral or a personal guarantee. In most cases, even if the entrepreneur has a bad credit report or past bankruptcies, then they may still qualify for merchant funding. There are no major requirements for qualifying for merchant cash advances.
- Few months operating history, which is sometimes optional
- Monthly gross credit card sales, the amount generally depends on your loan provider
- Documented gross monthly sales
- No formalities and no credit checks
Merchant cash advances offer easy applications, fast processing, and repayments are even easier. The merchant funding companies recoup their funds by collecting a certain percentage of total credit card sales. So, we can say that merchant cash advance loans can be a little expensive as compared to traditional bank funding, but they are more flexible and forgiving with easy processing and even simpler repayments.
Taking a business loan from a traditional bank involves tons of complexities. It’s just not easy! Poor credit history or no credit history makes it very difficult to get approved. But, that’s how traditional banks operate. So, why go the complex route when there is a much simpler way to get your business financed?
Merchant Cash Advance Loans are the quicker and easier way to get the funding you need!
So, whatever business goals you have—adding more stock to your inventory or hiring new staff, paying salary to your staff or buying a new piece of equipment—a Merchant Cash Advance is the right fund provider for your business. And on the top of that, the entire process of getting the loan is very easy! You don’t need to struggle with any drawn out application process or have to face any unnecessary delays. There are multiple benefits that your MCA leads can avail from a merchant cash advance loan.
Understand Merchant cash advance loans first
In simple terms, merchant cash advance loans are lump sum cash provided to your MCA leads against the future sales of their business. This is the only principle on which merchant cash advance loans operate. You need to commit a percentage of your future sales to the MCA lender. You can borrow this advance based on your current sales deposits, and then you’re absolutely free to invest the money the way you want for your business. And your MCA leads can avail this type of advance instantly and more conveniently than any other funding option.
So, sit back and count the benefits. There’s a lot that merchant cash advances promise.
There is no arduous paperwork involved with a merchant cash advance loan. MCA providers operate on very simple criteria. Monthly credit card returns and the length of time in business. Say, the minimum credit required is $5000 and the time in business is nine months. Your MCA leads just need to process two months of bank statements, a copy of a mortgage or lease statement, and identification proof to streamline the whole application process.
The approval process depends on how your business is performing in the market presently. There is nothing to evaluate from credit reports. The basic need is the stability of your business and the monthly income of the past few months. That’s why the approval rate of a merchant cash advance loan is really high as compared to other commercial loans.
Instant access to cash
The fast approval of your business loan application gives you instant access to the cash for your business needs. Normally, it just takes a week’s time to get the cash in hand. So, the entire process consumes less time and lets your MCA leads plan their business ahead.
Easy and relaxed repayments
When it comes to repayment, the amount varies because it depends on the monthly sales volume your MCA leads generate. In simple terms, higher sales mean higher deposits and lower sales mean lower deposits, which is quite different from a fixed monthly installment when it comes to commercial loans.