Comparing Business Cash Advance and Small Business Loan

by Harry Mark Web Master

It is difficult for any small business merchant to get cash small business cash advance as they will not be having an established business history. Many lending institutions will not approve the loan application of these merchants. The small business merchants may require working capital immediately to start the business. Business cash advance can if obtained can solve the working capital problem of the candidates.

Sources for working capital: There are many sources from which working capital can be obtained in short notice. These are family, retirement account, friends, credit card advances, savings and many more. Though these are easy to get, there will be some conditions attached to get cash advance from these sources. Business cash advances which are also known as credit card factoring are the much appropriate source which will be helpful to solve the working capital problems.

Business advance payment: Business cash advance is a process in which the merchant sells his master card receivable for lower price to get loans for his business purposes. The future receivables are sold to get business cash advance. Such cash advances shall be repaid in flexible terms. This is based on the revenue of the master card daily.

Though there are some business cash advance bad problems, this type of cash advance is available to newer entrepreneurs. This is provided to even entrepreneurs who have no long business history. Merchant advance is one of the great sources that provide required money for small business merchants. This is more easily procured than the traditional bank loans. These are more easily approved and processed fast.

Advantages cash business advance: Credit card funding is offered with high interest fee than the loans from local banks. For the advantage of accessing immediate loan, the merchant has to pay more interest throughout the life of the loan. One advantage of the credit card funding is that the repayment is tied to the credit card revenues so there would be no worrying about not having enough money to pay the cash advance monthly payment.

Other advantages with business cash advance is that there would no collateral necessary, no fees to generate cash advance and there will be no limitations on how the working capital is used. These are processed quickly and the approval rate is also very high.

Summary: Advantage with small business cash advances is that these are processed quickly and the approval rate is high.