Betsy Wise
By: betsy_wise
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Top 5 Business Cash Advance

A business cash advance seems enticing for people that need capital. Why? Because they are a fast funding option.

Plus, a business cash advance is very easy to get, so they seem like a great choice for small business owners that can’t get other types of financing.

In this post, we’ll list the best cash advance loans to consider; you’ll learn how to get one, and, most importantly, you’ll know whether getting one is a good idea.

Additionally, there’s a section of frequently asked questions and our recommendation for a better financing alternative for small businesses.

Click here to get a better alternative to cash advances!

different-sized stacks of dollars

What is a Business Cash Advance?

A small business cash advance, or Merchant Cash Advance for small business, is a financial product that offers you money for your business.

In exchange for hefty fees, the lender advances a lump sum payment to a business in advance of future credit card sales. Annually, a business owner could pay upwards of 400% depending on the cash advance amount and how long it takes to repay it.

Should you Get a Business Cash Advance?

You should know that a business cash advance (or Merchant Cash Advances) is extremely costly and may not be the best option for you and your business.

Without a doubt, cash advances can give a small business owner quick cash. But at what cost?

Compared to other forms of financing, Merchant Cash Advances are one of the most expensive in the market.

APRs can go all the way to 400%!

Some borrowers feel like they have limited control over their finances and their businesses’ future. This is mainly due to putting additional strain on cash flow as lenders routinely deduct daily fees.

Moreover, a business cash advance doesn’t build credit since lenders don’t report the fees you pay to the 3 major credit bureaus.

Even though they’re quick and easy options, there are much better alternatives out there.

Camino Financial, a Cheaper Alternative to a Merchant Cash Advance

camino financial logo

It’s normal for your cash flow to fluctuate, making it harder to predict how much working capital you need. You might need money to repair equipment, fund an unexpected expense or get business cash to buy inventory.

But a small business cash advance might not be the best option.

For all these situations and many more, a Camino Financial small business loan can be a better alternative.

Our Loans

We can offer you from $5,000 and up to $400,000 for your business.

You can have from 24 to 60 months to repay your loan and our annual interest rates range from 12% to 40%.

Here are some of our benefits:

  • We have minimal requirements, and applying is very easy
  • You can apply with an ITIN or an SSN
  • We can approve your loan if you have no credit history
  • Your timely payments will be reported to the appropriate business credit bureaus
  • We also work with bad credit scores, depending on their particular situations

A small business loan is a cheaper and more flexible financing alternative for your small business. So why not give it a try? Applying with Camino won’t affect your credit score!

Apply For A Business Loan!

How to Get a Cash Advance

This type of business financing is usually available through online applications. So, to get this type of financing, follow these easy steps:

  1. Review several lenders and find the one that can best match your needs (and that you meet their requirements)
  2. After you choose a lender, pull up their merchant cash advance application
  3. Complete the application by providing the information requested
  4. Then all you have to do is wait for the decision
  5. If it’s positive, you’ll receive your cash advance!

Remember that because these loans are based on your credit card sales, your business needs to accept credit card payments.

To help you understand how to get a cash advance even further, we’ll give you a quick introduction to what you need to complete a merchant cash advance application.

What Does a Merchant Cash Advance Application Require?

Minimally, you should expect to provide your personal and business address and phone numbers. Additionally, they will ask for:

  • your social security number
  • date of birth
  • total annual sales
  • requested cash advance amount
  • information regarding co-owners

#DidYouKnow
Application formats and requirements vary per lender. Some will ask for basic information to prequalify you for a cash advance. Others will require more detailed information.

As the application progresses, lenders may need your Employer Identification Number (EIN) for corporations and partnerships.

Be prepared to provide your peak sales month, questions about your terminal or POS system, and how your credit card processing procedure works. All this info helps lenders evaluate your application.

You’ll also need to document the information provided on the application. Typical documents include business bank statements and credit card processing statements.

#DidYouKnow
Some merchant cash advance lenders may ask for a voided business check, a copy of your driver’s license, and your credit history.

But, of course, MCAs are not the only financial products with an easy application process (you just need to complete basic information about you and your business) and easy-to-meet requirements.

Camino Financial offers loans to businesses that:

  • Have been operating for at least 9 months
  • Earn $2,500 in monthly gross sales
  • Are current with other credit obligations
Apply for a Camino Financial Loan

client paying with a credit card at a shop

5 Best Business Cash Advance Loans

Compare business cash advance loans (or MCAs) options to determine if this financing option is right for your business.

1. Reliant Funding

reliant funding logo

The company specializes in providing short-term working capital.

Generally, the company approves 70% of applicants; that’s why their product is one of the best business cash advance loans. In addition, the lender has a simple application process.

They also can offer borrowers a decision in minutes and funding within one day.

If you pay at least 50% of the original amount owed, it’s possible to qualify for additional funds.

The Cash Advance

Reliant Funding can deposit up to $400,000 into your merchant account. In addition, they offer factor rates starting at 1.18.

Borrowers can choose to repay daily or weekly the merchant cash advance for small businesses.

Requirements

Your company must have been in business for at least 6 months, have $60,000 in annual revenue, and have a minimum credit score of 525.

2. National Funding

national funding logo

The lender’s low requirements help start-ups and businesses needing quick business funding improve their cash flow.

The lender has competitive rates and doesn’t charge hidden costs or upfront fees.

The Cash Advance

National Funding offers advances up to $250,000 to borrowers in business for at least a year.

Requirements

The minimum annual sales requirement is $150,000, which includes at least $3,000 in monthly credit card transactions.

Applicants must provide 4 months of credit card statements.

3. Stripe Capital

stripe capital logo

Stripe uses your existing business account to deduct its standard 10% loan fee and daily deductions for business credit card sales.

The Cash Advance

Businesses that use Stripe equipment to process payments can apply for an advance in amounts up to $25,000 with a maximum repayment term of 18 months.

Requirements

You must have 12 months’ worth of credit card transaction history for Stripe to determine eligibility. After that, there’s no lengthy application or credit check.

4. Square Capital

square logo

This type of business funding is available to businesses that use Square Capital for processing credit card payments.

The lender bases the cash advance amount on your card sales through Square and charges a daily percentage rate which is deducted automatically from your bank account.

Applying doesn’t affect your credit score.

The Cash Advance

Advance amounts range from $300 to $100,000 with factor rates starting at 1.12.

Requirements

You must meet your minimum repayment of 1/18 of the initial balance every 60 days, and you must fully repay the balance in 18 months.

They don’t require collateral for advances under $75,000.

5. Rapid Finance

rapid finance logo

Rapid Finance offers Merchant Cash Advances that could fit your business’ needs.

The Cash Advance

Cash advances range from $5,000 to $500,000 with factor rates starting at 1.22.

Requirements

The lender has 4 requirements to apply:

A valid form of identity, business bank account and routing number, three months of business bank statements, and copies of the last 3 credit card processing statements

Also, you must have been in business for 3 months and have at least $5,000 in monthly credit card sales.

Your credit score should be 550 or above.

businessman that got business cash advances

The Best Way to Finance your Business Needs

Business owners assume a considerable risk when getting a business cash advance.

They aren’t for everyone because this type of financing increases debt substantially if you can’t repay the advance. Merchant Cash Advances can also be extremely expensive.

Fortunately, there’s a better financial alternative—a Camino Financial small business loan. Compared to other lenders that require your business to have been in operation 1 or 2 years, we only require 9 months.

If you don’t have an SSN, you can apply with your ITIN.

We work with clients that don’t have a prior credit history, and we never ask for collateral to approve our loans. Plus, you can repay your loan in a timeframe that’s suitable for your business model and cash flow.

Even better, our interest rates are very competitive and friendly.

Why not apply for a business loan today and discover how Camino Financial promotes its motto, “No Business Left Behind,” in all of our loan products. This is an opportunity to find the best small business loan for your growth needs. 

FAQs About Business Cash Advance

Where can I get a cash advance?

Traditional banks and credit unions do not usually offer a business cash advance because they prefer to provide small business loans.

You can receive an advance on your future credit card sales by contacting one of the best business cash advance companies we listed above.

How do merchant cash advances work?

Technically, business cash advances are not loans. Instead, the lender advances a lump sum payment in the merchant account to a business based on future projected credit card sales.

The lender charges a repayment fee (called a holdback percentage). In addition, they charge an additional buy rate fee (also called factor rate) ranging from 1.1 (10%) to 1.6 (60%) of the merchant’s credit card revenue.

Once the business cash advances are funded to the merchant, repayment begins immediately through daily or weekly cash withdrawals from your business checking account.

Why do people choose MCAs?

Many small business owners are attracted to them because they don’t usually ask them to relinquish as much personal information compared to applying for a traditional bank loan.

Cash advance lenders want to substantiate how much revenue you receive through credit and debit card sales for a given period.

Because of that, they aren’t as concerned about your business credit history as they are about your ability to repay the advance based on sales.

Other “perks” are not making monthly installments, as you do with term loans or providing collateral to secure the advance.

However, a merchant cash advance can be a viable business financing solution when you use them as a temporary fix for cash flow problems.

The problem is that, as we’ve seen, all these benefits come at a cost, a very high cost.

Are there business cash advances debt consolidation loans?

If you have several debts, including a merchant cash advance (MCA), and have trouble repaying them, there might be alternatives for you.

For example, a debt consolidation loan is a type of loan used to repay all the other debts. And because debt consolidation loans have friendlier terms, you’ll have a much easier time making the monthly payments.

Are there cheaper alternatives to a merchant cash advance?

Yes, there are!

There are many small business loan options that are cheaper alternatives for a business cash advance and have friendlier interest rates.

The best part is that some lenders, like Camino Financial, have very simple application processes with minimal requirements.

This means that you can get approved for a loan very easily and won’t end up drowning in debt, as it could happen with a cash advance.

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