OVERVIEW
Merchant Cash Advance
Minimum
Loan Amount:
$5,000+
Minimum
Credit Score:
550+
Repayment
Options:
3-36 Months
Payment
Frequency:
Daily or Weekly
ALL ABOUT MERCHANT CASH ADVANCES
What Is a Merchant Cash Advance?
A merchant cash advance or MCA is a type of alternative financing providing immediate funding to a small business. Merchant cash advances provides businesses with an advanced upfront sum of capital in exchange for a percentage portion of future sales or receivables. Merchant cash advances are not loans, but instead an advance based upon a business's credit, future sales, past debt and credit history, and time in business. This type of capital requires no collateral or personal credit.
Small businesses who are unable to obtain traditional loans due to lack of time in business, poor credit history, or lack of collateral can benefit from a merchant cash advance. Advances on merchant daily sales are meant to be accessible to small businesses in need of quick working capital, without the lengthy documentation or waiting periods associated with traditional bank loans.
The amount of money a firm may obtain through a merchant cash advance is determined by a number of criteria, including its monthly income, credit score, and length of time in business. The typical range for merchant cash advances can be anywhere form $5,000 to $1M. That is anywhere from 20-25% of the yearly gross annual revenue.
Merchant Cash Advance Topics:
The repayment of a merchant cash advance is determined by a proportion of future sales. This implies that the lender keeps a share of each sale until the advance, plus any applicable fees and interest, is repaid in full. The repayment or payback is commonly referred to as a "factor rate."
Some lenders do offer discounted early repayments, which are usually available if requested.
Merchant cash advances are great options for businesses looking to fund an opportunity in order to generate more revenue. These type of businesses could use the capital during peak seasons to expand their operating capacity or purchase additional machinery or inventory to drop the overall cost. Businesses that commonly use these types of small business loans include:
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Trucking and logistics
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Service or professional based industries
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Restaurants and bars
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Specialty construction
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Retailers, distributors, or suppliers
THE STEER PROMISE
Helping Small Businesses Grow Across The U.S.
At Steer Financial, we understand that no two businesses are alike. We offer financing solutions as unique as the business owners we help. Together, we can help steer your business to its full potential. Step one is determining which type of financing is ideal for your business. We work hard to deliver honest, reliable, and transparent customer service so you can feel confidence choosing us to help you meet your business capital needs.
Serving All 50 States
By leveraging our network of 45+ partner lenders, we can offer tailored solutions to businesses across the U.S. regardless of their size or industry.
Secure + Safe Data
We strive to keep all of your information secure and private. We assign a funding specialist to guide you along the entire process.
10+ Years of Experience
Our expertise has enabled us to understand small businesses and offer the highest level of service to you and your business.
HOW IT WORKS
How Does a Merchant Cash Advance Work?
At Steer Financial, we strive to make the process of obtaining a merchant cash advance fairly simple. Your business will be paired with one of our funding specialist to ease every step necessary. First you will complete our verification form together with the last 3 months of business bank statements.
Merchant Cash Advance Alternatives
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Working Capital Loan
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SBA Loan
Once we receive your documents we will match your business to one of our partnered lenders who will then evaluate the application and determines the amount of money that is available for your business.
Once accepted, your assigned funding specialist will describe the terms, advance amount, and go over the conditions to receive your working capital in as little as 24 hours.
A merchant cash advance is often repaid using a percentage of the total sales per day, week, or month depending on the lender. This indicates that the lender deducts a percentage of each sale until the advance is repaid in full, plus any applicable fees and interest. In general, the payback duration ranges from three to thirty six months.
THE ADVANTAGES
What Are the Benefits of a Merchant Cash Advance?
There are several benefits of a merchant cash advance that make it a popular choice for businesses. First, the application process is quick and easy, with funding often available within a few days. Additionally, the repayment process is flexible, with payments being made as a percentage of sales rather than a fixed monthly payment. This can be helpful for businesses with variable revenue streams.
Another advantage of a merchant cash advance is that it doesn't require collateral. Unlike traditional loans that require assets to secure the loan, a merchant cash advance uses future sales as collateral. This means that a business owner doesn't have to worry about losing assets if they default on the loan.
WHO SHOULD APPLY
Who Should Get a Merchant Cash Advance?
Merchant cash advances can be an effective financing solution for small businesses that want immediate access to capital, but might not be eligible for traditional bank loans. MCAs are considered to be more of an expensive financing option due to the higher interest rates they carry. Consequently, as a last resort, small businesses who have exhausted all other funding alternatives might think for an MCA.
Merchant cash advances also provide a number of benefits over conventional bank loans, such as a rapid application process, quick approval, and a simpler qualifying process. These tend to appeal business owners with less-than-perfect credit since they don't call for documentation or other in-depth analysis.
A merchant cash advance is good for many types of businesses that process a large number of credit card transactions or service many clients on a daily basis. Below are examples of businesses that can benefit from a merchant cash advance:
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Convenience stores and gas stations
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Service-based businesses
LOAN USES
What Can a Merchant Cash Advance Be Used For?
A merchant cash advance can be a versatile financing option for small businesses which can be used for a variety of purposes. Merchant cash advances are best used as short-term financing rather than a long-term investment. Here are some common ways small businesses use a merchant cash advance:
Covering unexpected expenses
A merchant cash advance can provide a source of funds to cover unexpected expenses, such as equipment repairs or emergency repairs to a business property.
Financing growth opportunities
Businesses can use an advance to fund growth opportunities, such as expanding into new markets or launching new products.
Managing cash flow
An advance can be used to manage cash flow gaps, such as paying suppliers while waiting for customer payments.
Purchasing inventory
An advance can help businesses purchase inventory and maintain adequate levels of stock to meet customer demand.
MINIMUM REQUIREMENTS
How To Qualify and Get a Merchant Cash Advance
At Steer Financial, we will work closely with formulating a plan for your business. We will assess your business with our partnered lenders to evaluate the strengths and assets your business has to decide on the loan's size and conditions. Strong financial statements and a high credit score might also increase your chances of being approved. To make sure a merchant cash advance is a realistic choice for your business, our funding specialist will walk you through the entire process from start to finish. Below is a quick overview of the minimum requirements in order to get an approval:
Time In Business
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At least 1 year in business.
Monthly Revenue
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At least $200,000 in sales per year.
Personal Credit
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Minimum of 550+ personal credit score.
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No open bankruptcies for over 1 year.
HOW TO APPLY
Three Easy Steps to Secure a Merchant Cash Advance
Same-Day
Decisions
We have partnered with over 45+ lenders to ensure that we match your business with the best lender and the most competitive rates. We work quickly to provide an approval in as soon as a few hours.
Fast
Funding
By utilizing our streamlined fast funding approach, your business can access the necessary capital in as little as 24 hours from the moment you approve the terms, ensuring a timely and efficient process.
