How the Merchant Cash Advance System Works
Merchant cash advances can be a like a new lease on life for many small businesses. This type of funding gives business owners the most flexibility and is often the fastest way to get money in whatever type of pinch. Best of all the whole process of the cash advance system is not complicated and riddled with hoops to jump through, it is straight forward and to the point so you can get you small business needs taken care of swiftly.
Application and Approval
A simple information form is typically offered online on as a pre-approval and contact system. Once a small business owner fills this out the merchant cash advance company will contact them and let them know if they meet the minimum qualifications. At this point if pre-qualifications are met a verification of the provided information will need to be viewed prior to offering full approval. The pre-approval and approval is different for each cash advance company, but usually ranges from 24-72 hours. Cash Advance Tiger realizes the urgency some small businesses have in this matter and make it a point to complete most approvals in a 24-hour period.
Once an approval for a business cash advance comes through it will be only a matter of days before the funds are delivered to the small business in question. Disbursement of these funds to the business owner normally takes between 3-7 days and in is often in the form of a check.
Cash Advance Tiger tries to maintain a fast and convenient 3-day money turnover period in order to better assist the small business owner that they are working with in getting started on improving their businesses.
How Payments Are Collected
Once funds have been disbursed to the small business owner the cash advance company will take a set percentage of each month’s credit/debit card processes, this means the amount paid out to the cash advance company changes each month as the payment will ebb and flow with monthly sales and never be a harsh fixed amount.
business cash loans are collected on in one of three ways:
ACH withholding: The cash advance company will receive and review the monthly rundown of a small business credit/debit card processing, tally what their percentage cut of this is, and then directly deduct that determined amount from the business’ account by way of ACH.
Trust bank account withholding: A bank account is opened for the small business’ credit/debit card processing income and is controlled by the cash advance company. Each month after the processing income is deposited in the account the cash advance company reviews the amounts, holds onto their cut, and then sends the small business owner their profits via ACH, EFT, or wire.
Split withholding: The credit card processing company will view the monthly processes and split the amount directly giving the small business owner their portion and the cash advance company their percentage.
Out of the three ways to collect on unsecured business loans, the latter is the most used and well liked way to go about payments.