Merchant Cash Advance
Merchant Cash Advance provides businesses with money in exchange for a share of future credit card or EFTPO sales.
Ideal for hospitality and retail with low value and high volume transactions
80% of monthly sales | Trading 9 months+ | No financials to $70K | Unsecured | Flexible payments
Merchant Cash Advance solutions
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.
- 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
Accrutus Capital has solutions to improve retailers cash flow fluctuations through our multiple working capital facilities.
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 industries
Best suited to 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 for Retail
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.
Merchant Cash Advance benefits
Owners cannot obtain a bank loan without financials in the needed timeframe
The owner/s do NOT have collateral or sufficient equity to offer the bank
Needs need flexible payback structure, and renewal options available
Your credit score is below average due to past payment issues or too many enquiries
Expect to have sales increases, but need the merchant cash advance now to maintain the operation
Merchant Cash Advance How it works
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
Repayments fluctuate with daily sales. No fixed installments and terms
No security required and no applications fees
Not a loan
The advance is not recorded as a debt on your credit file
Potential tax benefit
Merchant cash advance is written off as a purchase or expense
Trading for 9 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
Merchant Cash Advance is simply leveraging off your future customers to fund your business growth
Merchant Cash Advance to manage your working capital
Cash is simply the flow of cash through the company over time. Working capital is required to pay for wages, daily functions to provide the goods and services being sold. The cycle repeats where the revenues received provides new cash that can be used to finance further productions and sales and increasing the companies economic value and profitability.
As a business owner you must tightly manage the cash flow generated and what factors impact those flows. This is a business skill essential to the liquidity and long-term viability of the business. While a company can have solid income and assets and be profitable, there are times when cash is short and other financing methods needs to be implemented.
For high merchant transactions business, working capital can be accessed through your future sales via the merchant cash advance facility. The management of working capital involves managing 4 aspects within a company.
- Inventory (stock or goods still being production)
- Accounts receivable (debts that are owed to the company)
- Accounts payable (money the company owes to suppliers)
Shortage in working capital can prevent a company meetings its payroll and damage supplier relationships if accounts are regularly overdue. If managed responsibly, a Merchant cash advance can smooth out cash flow gaps and help you negotiate discounted terms with your creditors.
Merchant Cash Advance repayment
Your approved Merchant cash advance provider will setup a pass through account on your behalf to hold back the agreed percentage of your daily credit card receipts until the full advance is paid back. The rate varies between 15-25% based on the risk profile of the borrower. The remaining balance is sent to your business bank account daily.