A merchant cash advance is a financial product available for small businesses to fund their business projects. As compared to the traditional small business loan, a merchant cash advance can give you access to quick cash without going through a rigorous loan application process.
Many small businesses choose to acquire a merchant cash advance to fund their start-up, expansion, and any projects to improve their business. So, if you’re also looking for a cash fund for your business, you should consider taking a merchant cash advance.
However, when choosing a provider, here are the five things you should look for to ensure that you are getting the best merchant cash advance offer available.
Good Interest Rate Offer
The first thing you should look for in a merchant cash advance provider is a reasonable interest rate for cash advance. As a business owner, every cent counts. So, you should choose options that allow you to save even a small amount of money in repayment.
Merchant cash advance interest rates are not created equal. Each company provides varying offers that include different interest rates. Before committing to a cash advance provider, you should compare rates first.
Comparing interest rates from different companies will help you narrow down your options. Once you find the one that suits your preference, you can start researching the said company.
Good Reputation
The next thing you need to look for in a merchant cash advance provider is their reputation. A company's reputation is also a good factor to consider when eliminating providers from your list. But, again, you’ll know whether a provider has a good or bad reputation through customer reviews.
Search for reviews and ensure that you’re looking at multiple sources. Reading reviews from reliable sources such as the Better Business Bureau and other websites with a high trust rating is highly recommended.
It would be best to avoid having financial transactions with companies or individuals that don’t have a good reputation. Being vigilant always results in good things, so you better be careful and only choose to communicate with legit and reputable companies.
Quality Customer Service
Another indication of a good merchant cash advance provider is if they have excellent customer service. You can contact the provider through customer service and observe how they deal with their customers.
Good customer service should be courteous, friendly, professional, and helpful. Talking to the company's customer service is one way of knowing whether you’ll have a good relationship with the provider.
Customer service can also be the first you can contact about the company. You can ask questions and raise some concerns even before you get into business with them. It’s like hitting two birds with one stone. You’ll get the answer you need for your queries and also get a chance to observe the customer service.
You’re entitled to receive good customer service for the fees you’ll pay the provider. Additionally, you should check if they have 24/7 customer service to help you whenever questions or problems arise.
Quick Application Result
Each provider will approve cash advance applications in different ways. Although most merchant cash advances are quick, others can take a long time before they give the result. So, when you look for a good provider, you should first know how long the process and the approval will take.
It should also be a vital factor you need to consider when picking a merchant cash advance provider. You need cash fast. Therefore, you should go for a provider who can quickly give you the amount you need.
Flexibility
Getting a cash advance from a provider that offers flexible terms can also be advantageous. Some providers will require you to have a predetermined obligation or fixed amount. You’ll never know when your business will face challenges, and having a flexible cash advance term will benefit you.
When you have flexible cash advance terms, your business will have a chance to fix the problem without worrying about your cash advance payment. In addition, because of the flexible loan term, you’ll never get caught up with your repayment.
Your repayment obligation will adjust according to your business's finances and status. It’s one of the reasons why most business owners favor merchant cash advances.
However, it’s still important that you go through the term you agree to before applying for the loan. This way, you can better understand the term, including the fees and the rates.
Start Your Journey in Searching for the Best Provider
Now that you know what to look for in a merchant cash advance provider, you can start looking for the one that can provide you with the best offer that you can get. This way, you can ensure that you and your business benefit from it.
Aidan has been writing about personal finance for over 6 years. Prior to this, he worked as a Corporate Finance Analyst where he specialized in Due Diligence, Company Valuations and more. He is a CFA charterholder.
