Finance

How to get a merchant cash advance?

A merchant cash advance is the best option when a small business requires a little capital urgently. It is most suitable for firms that largely obtain revenue from credit and debit card sales. These companies include restaurants, cafes and retail outlets. A merchant cash advance is technically a commercial transaction as opposed to a loan, and a borrower receives a lump sum amount in exchange for a percentage of their sales.

Repayments of merchant cash advances can are made in two ways. First, you can receive a particular sum of advance in exchange for a percentage of your future credit card sales. Second, you can get a lump sum amount that has to be repaid by transferring a fixed daily or through weekly debit from your bank account to the MCA provider. A MCA must be considered by a small business only when it needs immediate access to capital. For instance, when it wants to purchase the stock at a discounted price or invest in machinery. It can also be a convenient option for businesses that do most of its transactions via credit cards. However, businesses must express caution while taking a MCA as it can quickly put them through a vicious cycle of borrowing. If you are a small business, looking to get a MCA, here’s how you can apply.

Step 1: Fill the MCA application with your business tax ID, Social Security number, and other vital information.

Step 2: Provide documentations such as monthly bank statements, credit card receipts, proof of citizenship and a copy of the lease for your business premises.

Step 3: Get the approval for the MCA within 24 hours.

Step 4: Set up the credit card processing.

Step 5: Make the final agreement on the details of the merchant cash advance.

Step 6: Once the deal is finalized, the advance amount will be deposited into your account. The repayment through the merchant account will activate almost immediately. Typically, it takes about two days for the advance to be deposited into the business’ account after approval has been made.

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