Small Business Loan Leads
In the commercial finance industry, a merchant cash advance is taken by merchants as a short-term alternative to bank financing. Rather than lending money to small business owners for their projects or day-to-day expenses, banks tend to provide capital only in times of need. In fact, according to experts from Merchant Cash & Capital, many popular lenders have been getting away from traditional lending altogether and are turning towards lines of credit and revolving loans instead. These types of bank loans may be an attractive option for some borrowers, but they require strong personal or property collateral.
In addition to these types of financing options being limited in availability, they also have strict qualification criteria that must be met before receiving approval. In contrast, a merchant cash advance requires little up-front documentation – if any – and provides quick access to cash.
In order to bridge the gap between merchants and small business owners, many financial service providers have begun offering merchant cash advances specifically for this target market. These direct lenders focus on a very specific niche within the commercial finance industry, so they offer their services with lower rates and more lenient qualifications than traditional banks do. In most cases, special financing is reserved only for established businesses that have been in operation for at least one year or more. However, some providers may accept newer enterprises as well.
This article will provide a brief overview of merchant cash advance lending programs and discuss how you can generate business leads for this type of credit.
What Are Merchant Cash Advances?
A merchant cash advance is a form of business financing that allows merchants to receive funds in exchange for a percentage of future credit and debit card sales.
Just as with other forms of small business loans, this type of financing provides capital for projects, equipment purchase and other operational expenses. However, merchant cash advances are not long-term solutions to financial problems; they are short-term financing options that provide you with the necessary cash to meet your immediate goals.
How Merchant Cash Advances Work
Merchant cash advances can be classified as either deferred or non-deferred transactions:
- Deferred payments – The lender will take a percentage of all sales made by the business until the full amount has been paid off. This option makes it possible for small businesses to receive a lump sum of money without having to pay it back before typical loan repayment terms.
- Non-deferred payments – In this case, the lender will take a percentage of all future sales from specific credit and debit card providers. This means that once the advance has been paid off, you won’t have to give away any additional percentages of your sales unless you decide to use other payment processing services in the future.
How Do You Apply for Merchant Cash Advances?
Applying for merchant cash advances is fairly simple; while there are some lenders who require full documentation beforehand, others allow merchants to apply online using only basic information. However, before filling out an application, make sure that you understand which payment processors your provider accepts. The application process for this type of small business financing is time-consuming, so you should submit your inquiry as early as possible.
How Are Merchant Cash Advances Different from Other Loans?
Merchant cash advances are not long-term financial solutions; in most cases, these loans can be paid off within several months. Also, unlike traditional loans that require collateral or credit score assessments, merchant cash advance providers do not look at your personal assets or credit history when deciding if you qualify for a certain amount of money. Instead, they base their decisions on the approximate total monthly sales volume that your business generates.
This means that if you typically have low levels of sale transactions throughout the year but then experience an increase during specific periods of time, you will still be able to apply for merchant cash advances. How Can You Generate Business Leads for Merchant Cash Advances?
Merchant cash advance providers are interested in doing business with established enterprises that can show consistent sales volume over the years. However, if your business is relatively new and doesn’t meet this criterion, you can use our service to generate qualified leads that can be passed on directly to financing providers. Since we work with lenders looking for high-quality prospects, they will always make an informed decision when providing their services; this means you won’t have to worry about them rejecting your loan application because of poor credit history or other problems.