A small business cash advance, also referred to as a merchant account advance, is a way you can sell your future credit card sales to a third party. We’ll explain how these work, in today’s article.
First, the person buying your future sales will look over your average sales volume for the last six months to determine what your monthly average is. Typically, most companies will buy up to one month’s worth of sales at a time. They will buy these sales at a discounted rate. This rate varies from a couple percentage points to 20%. It really depends on the lender. So, if you sell $10,000 worth of sales at a discount rate of 20%, you’ll be disbursed $8,000.
Also, there is usually the option to recharge, if you need to borrow again. Usually, you can do this two times with the same funding application.
Repayment is done through your credit card account at point of sale. This account is also referred to as your merchant account, which is why these are often called merchant account loans. A small amount will be deducted from each sale and given to the company that purchased these sales.
Typically, the amount that is extracted is based on a calculation of repayment taking approximately six months. This is based on your sales volume from the last six months. Repayment of your small business cash advance can take as long as twelve months, without penalty. Also, they can go as quickly as ninety days, if sales are running much faster than average.
For more information, go to Small Business Cash Advance at http://www.unsecuredbizloan.com/small-business-cash-advance/