subject: Differences Between A Standard Bank Loan And A Business Cash Advance [print this page] Business owners looking to get a loan have few choices when it comes to lenders. Many choose the traditional, conventional route of going to a banking institution and going through the process. There is an easier, less painful way to secure a loan for your growing business. That solution is known as a merchant cash advance or a working capital loan. It is an advance on your future credit card sales. Basically, when someone uses a credit card at your business, you give a percentage of those sales back to the lender.
The best part about that particular business model is that there is no monthly minimum. You pay the loan when you get paid. This takes a lot of the pressure and stress off of the shoulders of a business owner, especially during periods of slower sales. There are other benefits to choosing a merchant cash advance over more traditional forms of bank lending.
One of the main benefits is the actual application and approval process for each type of loan. A traditional business loan can take an excruciatingly lengthy amount of time. You also need a high credit score, two to three years of business and sometimes personal tax audits, detailed financial statements, and collateral. That can seem incredibly overwhelming for a growing entrepreneur. With a merchant cash advance you only need to wait 48 hours before finding out if you were approved or not. You do not need a high credit score, any audits, or even any collateral! You also don't need to pay any closing costs or application fees. It's a breath of fresh air from the smothering bureaucratic red tape that you might need to endure with a traditional bank loan.
If you're a fledgling company, you don't need to worry. While you may be turned down for a conventional loan from a bank for being "too young" you only have to have been in business for a year before being eligible for a merchant cash advance.
The benefits of a cash advance for business are numerous. When compared to a bank loan in a conventional sense, it seems like the only reasonable course of action for an entrepreneur. If you're thinking of expanding your business or just need a short term boost in revenue, consider a merchant cash advance for your business. It's an easier, better way to find lenders that will help you grow.
