Merchant Cash Advance
Merchant Cash Advance provides businesses with money in exchange for a share of future credit card or EFTPOS sales. This facility is beneficial to a wide range of businesses with high volume of small transaction amounts such as fashion & retail shops, club & restaurants, health and beauty, medical & health and automotive to name a few. Ideal for businesses with strong credit card and EFTPOS sales.
Merchant Cash Advance when to use it
Merchant cash advance does not suit every business and is certainly not a long-term funding solution. As this is an advance against future sales, the owners must manage the needs of the business and the ability to pay back the merchant cash advance without impacting daily operations.
Typical uses of a Merchant Cash Advance
- Purchase new stock or equipment, hire and train more staff, upgrade shopfront or renovate your office
- Fund a new franchise, or franchise your existing successful brand where you can leverage off future income
- Pay off urgent debt or consolidate tax and superannuation liabilities to improve your cash flow
- Need to pay for goods being imported before leaving the dock or shipping and delivery costs
- Marketing costs to launch a new product, run an event to build brand awareness
- Pay out a business partner, or accumulate a deposit to purchase business premises
Merchant Cash Advance most beneficial for
- New business unable to obtain a bank loan without 2-3 years financials
- A business owner has no collateral or insufficient equity to offer the bank
- Needs need flexible payback structure, and renewal options available
- The business owner’s credit score is average due to past difficulties and has rectified it
- As business sales increase, can repay the merchant cash advance soone
Merchant Cash Advance for retailers
Stiff competition from online retail sales, changing demand from export markets, fluctuating exchange rates and changing consumer trends are significant issues in managing cash flow. Plus having to compete with the bargaining power to major retailers your cash flow can receive a battering.
Retailer should consider Merchant Cash Advances which are designed with speed and simplicity. Ease of repayments through daily, weekly or monthly schedules and automatically deducted from your bank account. No checks to write, no transfers, and no surprises, its short-term funding without the stress so you can focus on making money.
Retailers and the hospitality sector mostly qualify for Merchant Cash Advances due to their high credit and debit card sales, operate form leased or owned premises and experience seasonal cash flow high and lows.
Merchant Cash Advance suits:
The retail and hospitality industry where the business can take 2 years to be stabilize and build a loyal and consistent customer base.
Seasonal businesses especially those located in tourist areas can use a merchant cash advance to stock up in readiness for the new season’s customers.
Merchant Cash Advance is NOT a loan
High Approval rates
Over bank finance, funding up to 80% of business turnover
No fixed terms
To payback the advance as its calculated on a % of future sales
Through current and future credit card and EFTPOS sales
No fixed monthly payments works with daily sales revenue
No security required and no risk to your assets
Not a loan
It is an advance against future credit card sales
Fast short-term funding compared with the banks
Trading for 6 months and no financials
Merchant Cash Advance do you qualify?
- Merchant must be owner & trading for 12 months
- Minimum of 10 different customer deposits
- Minimum business turnover of $10K per month
- Require 6 mths banking & merchant statements
- Merchant should show positive bank balance
- Credit score above 400+ with paid defaults
- No open bankruptcies, tax liens or judgments
- Merchants must lease business premises
- Provide landlord and 2 business references
- Cash advances over $70K require financials
Merchant Cash Advance Industries
- Sports, retail and all fashion stores
- Medical, dental and pharmaceutical
- Restaurant, hotel, club & hospitality
- Supermarkets, butcher & bakery
- Hair, nail and beauty salon
- Health, fitness and sporting clubs
- Learning and vocation facilities
- Gift, tobacco, liquor and music stores
- Automotive workshops, hardware stores