For businesses that don’t have the time or the credit score for a traditional bank loan, a merchant cash advance can be a great resource. Unlike a loan, a merchant cash advance, also called a business cash advance or receivable financing, offers a fast application and approval process and can deliver funds in as little as 24 hours.
LendRev can provide access to capital fast because we offer a direct path to the lending marketplace, empowering businesses like never before. Just complete one free application and LendRev gets to work, searching our network of lending partners where they compete for your business.
Fill out a single, free online application*
Speak with your personal funding coordinator
Receive same-day approval with proper documentation†
Receive the funding you need in as little as 24 hours‡
This type of financing provides a range of advantages over traditional loans.
$5,000 - $200,000
3 months – 24 months
lower credit scores accepted
daily / weekly / monthly
typically within 24-hours
|Merchant Cash Advance||Business Loan|
|You have no debt. The financing company is repaid by collecting a portion of your future revenue.||The debt you have is repaid based on principal combined with interest charges.|
|You can finance more money as your revenue increases.||The money you borrow is capped on what you were approved for.|
|Good credit scores are not essential to qualify for an MCA because repayment is based on the revenue your customers provide.||To qualify for a loan, your credit score, financial records, assets and liabilities are all taken into consideration.|
|You can have cash in hand 24 hours after applying.||It can take 1-2 months before a loan is secured and cash is available.|
|The application can be completed in as little as 10 minutes, with minimal documentation required.||Extensive vetting of the business is done, requiring financial statements and other personal information.|
|As more money is financed, the rates of the agreement can be adjusted.||The interest rate is set at the beginning of the loan and remains unchanged throughout the life of the loan.|
|The amount repaid varies every month because it is based on sales for that month.||You owe the same amount every month.|
A merchant cash advance is not a loan, but rather a sale of a portion of your company’s future credit/debit card sales to a finance company, which in turn, provides you with a lump sum advance. This type of financing is also referred to as “factoring.” Funds are available quickly, and when it comes to the approval process, your monthly sales are more important than your credit score. Repayment amounts are based on a factor rate, rather than an APR, and payments are automatically withdrawn on a daily, weekly or monthly basis, either through a partnership with the payment processing company or by deducting the amount from your business checking account via ACH (Automated Clearing House).
With a merchant cash advance, there is no need for a personal guarantee because your future sales act as collateral to secure your financing. This allows merchant cash advance providers to be more flexible when it comes to applications with less-than-perfect credit, bankruptcies and debt.
These cash advances can be used for a vast range of purposes and are suitable for companies of all sizes, from new businesses to Fortune 500 companies. Whether you’re a multi-state construction company in need of new equipment, a hometown florist in need of more space, or a globe-trotting technology company in need of more staff, a merchant cash advance may be the fastest way to secure the capital you need to grow your business.
Because merchant cash advances provide a simple application process, quick approvals and fast access to funds, they are a great option for all businesses in need of capital, regardless of size, industry, products sold or services offered. For businesses with bad credit or no credit, this type of funding is especially appealing.
There are several ways merchant cash advances can be repaid. A few of the most common ways are described below.
When a credit card sale is processed, an agreed upon percentage of that sale is withheld. When processing is complete, that percentage of the transaction is instantly sent to the lender.
The finance company controls an account where all the business’s credit card revenue gets deposited. The lender retains the agreed-upon portion of the sales and sends the rest on to the business. However, there is typically a one-day delay before the business receives their portion of revenue. For many businesses, this delay can be a less than ideal situation.
ACH is the network used for completing electronic financial transactions in the United States. With this type of repayment plan, the finance company uses ACH to automatically debit a portion of your credit cards sales directly from your business’s checking account. The amount deducted can be either a percentage of your daily sales or a fixed amount.
A merchant cash advance is one of the easiest types of financing to secure, in regards to both the application and approval process. The main application requirement is that you be able to provide records of your revenue for the preceding 3 months.
Approval is not limited to those with stellar credit. Bad credit, debt and even bankruptcy won’t disqualify your application. For companies with a limited credit history or for those that have weathered difficult times, a merchant cash advance can provide the capital they need when traditional bank loans aren’t an option.
With Lendrev you don’t have to fill out applications all over the Internet. The moment your LendRev application is complete, it’s instantly sent to our network of lending partners. When those partners compete for your business, you benefit from better rates, quicker approvals and faster funding times. As soon as you’ve accepted an offer from one of our merchant cash advance providers, the funds will start making their way to your account. Most businesses receive their cash in within 24 hours.
LendRev does not charge an application fee, nor do we charge a fee for matching your business to a merchant cash advance provider.
A merchant cash advance can help your company whenever it’s growth or success is jeopardized by a lack of ready capital. You can use your cash advance in whatever way you see fit. There are no restrictions on how you use your funds.
If your company needs to hire additional staff to expand your lineup of products or services, provide better customer service, or enter into a new market, a merchant cash advance can provide you the capital needed to respond quickly to your staffing goals.
This type of financing can also be used if you’re having difficulty meeting your current payroll obligations. Because a merchant cash advance can be secured so quickly, you can respond to a potential disruption in your workforce before it becomes an issue.
Merchant cash advances are very commonly used to purchase inventory. As any product-based business knows, it’s impossible to generate revenue if you don’t have products to sell. But if an upcoming order has you crunched for time, or you have a low credit score, a traditional loan is going to fall short. Alternative financing, like merchant cash advances, can approve and fund your inventory purchases in time to keep your business competitive and profitable.
Every business relies on their equipment to keep their company and revenue rolling. Whether it’s updating your computers, adding a vehicle to your fleet, or taking advantage of limited-time deal on a piece of machinery, a merchant cash advance can fund your equipment purchase in as little as 24 hours. And unlike a traditional equipment loan, you don’t have to put up your new equipment as collateral.
When your goal is to expand your business, it can be hard to access the financing you need to quickly respond to an opportunity. The perfect retail space you’ve had your eye on may have other others waiting in the wings. The franchise opportunity you’ve been waiting for might only be available for a limited time. Opportunities like these can’t wait for your application to be processed at a bank. You need to act fast, and a merchant cash advance is a great way to respond quickly to the marketplace.
Staying in front of your current customers and getting in front of new ones is vitally important to any business, big or small. Whether you’re establishing your brand in a new market or introducing a new product line, you’ll need to get your message out, loudly and often – and that takes cash. A merchant cash advance can provide you with the funds you need to get your message heard.
* In order to secure funding, LendRev requires at least three months in business with a minimum of $10,000 in monthly revenue.
† With the appropriate information and documentation available, it’s possible to have your application approved in as little as one hour.
‡ Many of our term loan and merchant cash advance providers can be very fast, providing funds in as little as 24 hours. SBA-backed lenders may take two weeks or more because Small Business Administration loans require significantly more documentation.