Merchant Cash or ACH Advance

Merchant Cash Advance and its related ACH Advance are lump sum advances of immediate cash which is repaid with a percentage of future credit card or other retail sales. Although considered an expensive form of financing, Merchant Cash and ACH Advances are often readily accessible sources of working capital when other options are not available.

How a Merchant Cash or ACH Advance Works

A Merchant Cash or ACH Advance is a lump sum advance of cash today which will be repaid from future credit card or retail sales. The provider will collect repayment by taking a percentage of each sale until the advance is repaid. its important to note that most Merchant Cash or ACH Advances are not considered loans but simply advances or risk capital.

Although considered expensive, there are some significant advantages and benefits to Merchant Cash and ACH Advances which include...

No Personal Guarantees: In most cases, there are no personal guarantees required from the business owner.
Flexible Repayment Terms: Because the provider takes a small percentage of each sale until repayment is made, there are no fixed monthly amounts. If sales are slow, the repayment is decreased. If sales are robust, the repayment is faster.
Ease of Access: Merchant Cash and ACH advances are one of the easiest forms of financing for many businesses to access.
Use for Any Purpose: Though commonly used to purchase new equipment or for expansion, Merchant Cash and ACH Advances can be used for virtually any purpose.

A Renewable Source of Funding

Although Merchant Cash and ACH Advances are often considered an expensive form of finance, there is considerable risk in the transaction for the provider so the expense is understandable. It is also important to note that industry statistics evidence nearly two out of every three businesses opting to utilize this type of funding, renew their advances a second and even third time for working and expansion capital until they can qualify for a more traditional and less expensive type of financing.

Find Out More

One of the best ways to further explore this powerful small business finance tool and to see if its right for you and your business is to request our FREE booklet, "When Banks Say NO!...The Small Business Guide to Factoring." Its FREE, from Mango Factors. (click here to order)

Merchant Cash Advance