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| Credit Card Factoring - The Benefits of Using Credit Card Factoring for Your Small Business |
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Credit card factoring is one way that small businesses can find additional working capital when they need it. Businesses can always use some additional funding, especially during projects such as renovations, expansions, and upgrades. Being able to get an advance and get the capital you need for your business is something that can take a load off your mind and help you to be more prosperous.
|  | | Unstable economic situations can make it exceptionally difficult for small and relatively new businesses to obtain the financing that they need in order to continue to grow. |
How Credit Advance Works
Credit advance from Merchant Credit Advance works simply. In fact, it is one of the easiest ways to obtain the financing you need when you need it. The first thing to know is that credit card factoring is that it works as a pre-sale. This means that the company purchases a certain percentage of future credit card sales.
Because of this, there are some requirements that are necessary to fulfill in order to qualify for this type of financing. The first is that your business must have a minimum of 12 months worth of business; in other words, you must have been open for a minimum of 12 months. You also must generate a minimum of $5,000 worth of credit card sales within a given month.
You must also go through a credit check. This is to ensure that your business actually can benefit from the transaction and to ensure that you receive the best possible rate for your business and financial situation. You will also be required to submit proof of ownership. This means that you must present a business license and tax returns as proof of ownership; other additional documentation may be required.
Other restrictions may include which credit card processor you can use. There are, however, some financial processors that work with credit card factoring and some that do not. You will need to use a financial processor which works with Merchant Credit Advance in order to obtain services.
The restrictions as far as how the money may be used are light compared with other funding sources. Credit card factoring options simply require that you spend the money on expenses necessary for the expansion or improvement of your business, which means as long as it benefits your business, you are going to be able to spend the money any way that you wish.
With regard to how fast you can be approved, this can be a major consideration for choosing this type of credit card factoring finance options. After approval it typically takes about 10-14 business days in order to obtain the agreed upon amount.
How the Entire Process Works
The process is fairly simple and straightforward, making it easy for anyone to use. Once you have been approved and receive the money, you are free to use it as you deem fit to further your business. Over the length of the term of the advance, a percentage of sales completed with credit card transactions will be transferred to the account set up with Merchant Credit Advance. This is for the repayment of the advance. It is also the reason why a minimum of $5,000 in transactions is needed per month.
 | | | Credit card factoring can also be used to obtain the money necessary to buy out a partner or initial investor. | |
There is no repayment schedule so you can make lump sum repayments if you wish to repay the advance faster than using the credit card fixed percentages that are normally collected.
This is a perfect solution for businesses that cannot obtain traditional financing for whatever reason such as credit, or not having been in business for a long enough period of time. Unstable economic situations can make it exceptionally difficult for small and relatively new businesses to obtain the financing that they need in order to continue to grow. Many small businesses end up without having enough cash flow to do what they want or to handle situations that come up which may strain an already tight budget.
This is where credit card factoring can provide the most benefit. The process for approval is fast, and wait time between approval and when the money is delivered is quick, usually only about two weeks. This means it can be a real business saver if an emergency comes up and money is needed quickly. There is also no repayment schedule and fees are usually reasonable.
Credit card factoring can also be used to obtain the money necessary to buy out a partner or initial investor. There are quite a few small businesses that use loans or private investors (called hard cash) to start their businesses. These have high interest rates and can be difficult to pay, especially for smaller businesses. Using credit card factoring and obtaining an advance, business owners can buy these loans or investors out without having to worry about exceptionally high interest rates.
Credit card factoring has a number of benefits. It is easy to obtain with easy-to-meet criteria. You can get the money you need to do what needs to be done with your business in order to improve it, expand it and do what will benefit it most. This, of course, has the added benefit of expanding your profits.
There are some risks involved in credit card factoring and in merchant cash advance options; this is why it is important to carefully and completely research all options that are available to your business when it comes to locating financing options in order to obtain working capital.
If you are looking to expand, renovate, remarket, or even buy out loans, investors or partners then consider the advantages that getting a cash advance and using credit card factoring can offer you. There is no limit to what you can do when it comes to expanding your business if you have the capital to work with to make it happen. All you need is established sales, proof of ownership, and a business that has been in operation for at least 12 months to qualify for assistance through Merchant Credit Advance in obtaining a cash advance against your businesses future credit card receivables.
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