How to start a merchant cash advance company? Easy pickings indeed. First pick the business you are most familiar with and who has shown the most interest in partnering with you. What exactly is a merchant cash advance company?
In short, a merchant cash advances company is one which arrange a type of unsecured short-term alternative capital for an enterprise, utilizing the profits from their consumer credit card terminal transactions. The lender pays the entrepreneur a certain percentage of the amount borrowed, which in turn they use as capital to expand and grow the enterprise. It sounds simple enough, but what are the qualifications for receiving such financing? There are some criteria a lender will look for before approving any applications. Lenders want to see that you have been able to meet in the past, a number of years of experience in this type of lending, and that your business is solvent.
The most common form of merchant cash advances is known as an off-site lender. This simply means the lender will not require an in person or phone interview. Off-site lending typically just requires that the borrower has access to a merchant credit card terminal which accepts their card. Once the customer swipes their card at the card terminal and proceeds to make a purchase, the lender then pays for the sale via direct deposit to your bank. This payment process is completed automatically, eliminating the need for an extra employee in processing payments.
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Another form of merchant cash advances is known as on-site lending. This is usually what is called a “store front” and is typically done through out the United States. In order to qualify for on-site lending, the business owner must be a brick and mortar business. On-site lending is more costly than off-site lending but allows the business owner the ability to accept payments virtually anywhere. There is usually an application fee, but this is generally minimal. The application process is typically much simpler and faster with on-site lending companies, which often offer quicker approval times.
For those who are looking for information on how to start a merchant cash advance business there are several things to consider before making any final decisions. When it comes to small business financing, finding a reliable source of funding is important. Often a lending company will take a hard look at your past cash flow history. They are interested in knowing that you can sustain an adequate level of cash flow in order to make the payments on time each month.
For those who are interested in getting merchant cash advances there are several options available. One option is to find a third party lender. Lenders who provide merchant advance funding do require a higher interest rate and typically require a co-signer. You also need to be very comfortable with your decision. This means being able to adequately explain to the lender why your business is seasonal or if you have had financial problems in the past.
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When applying for a loan with a traditional bank or a private lender, you are required to provide documentation such as your credit history, employment history, tax returns, etc. Most traditional lenders will require the borrower to submit copies of their debit and credit card receipts along with proof of income and bank statements. With on-line merchant cash advances, you will not have to worry about providing documentation. The on-line company will take care of collecting the necessary documents and verifying your income and other financial obligations.
Once you have decided to apply for an on-line merchant cash advance, you will be required to complete a short application. This application will ask basic information about your business, your personal banking information, the amount of money you need to borrow, and the date you would like to receive your funds. You will then be directed to a secure site where you will complete your loan transfer and information is then processed. In about 30 seconds you will be notified if your loan has been approved and if not, you can then return to the secure on-line site and have the funds transferred to your bank account. There is no faster, easier, or more secure way to obtain a small business loan that offers competitive rates than an on-line small business advance.