The merchant cash advance industry has come a long way in the past 20 years. Business cash advances already had a lot of selling points: they’re unsecured, easy to qualify for, and can be acquired very quickly and with little paperwork. Unlike traditional business loans, they are structured as a purchase and sale of receivables. But none of that was necessarily unique to business cash advance. What really made them unique is how they were repaid. Instead of relying on merchants to make payments manually, payments were made automatically on the merchant’s behalf by their credit card processor. This way, business cash advance providers could eliminate certain risks associated with getting paid back, and it was convenient for many merchants. This method of repayment is known as “split processing”.
Fast forward to 2015, and the business cash advance industry is booming. New funders pop up every day trying to get a piece of the action, and originations continue to grow tremendously year over year. Programs have evolved over the years to become more competitive and to appeal to a wider range of businesses, but for the most part, the advantages are largely the same as they were. They’re still sold as a type of unsecured business funding that can be obtained quickly and easily. The only thing that has really changed in a significant way is the one thing that made them truly unique: the repayment method. Not only can you get a business cash advance without credit cards, many businesses that do accept credit cards are opting for fixed daily ACH repayment.
The Era of Fixed Payments
Merchant cash advance companies still offer split processing as a repayment method, but the vast majority of deals are repaid via ACH for a number of reasons. First, it decreased the average amount of time it took for an application to get funded. This is because the process of changing over a merchant’s credit card processing is no longer necessary. Second, it opened the doors to funding many industries that previously couldn’t qualify for a business cash advance because they don’t accept credit cards.
Whether or not you accept credit cards, we can get you into a great business funding program. Click here to get business funding now!