- Finance your business from £3,5k up to £500k
- Repayments aligned to future card sales
- No fixed payback schedule
- 24-hour approval, 90% approval rate
What is the difference between a business loan and a merchant cash advance?
If you’re looking for funding to grow your business, you will probably start looking at business loans. But, especially for smaller firms, business cash advances are another favorite source of funds. Although both financing methods involve receiving and repaying a sum of money, merchant cash advances are not the same as loans. Instead, the business gets an advance against its future credit card sales, and you repay via the business’s future card transactions.
A merchant cash advance is different than a loan in that we essentially pre-purchases some of your credit card transactions, “advancing” the money to you. We will “own” some of your future sales, and will collect the money from those sales. Unlike loans, cash advances technically don’t have an interest rate or a set repayment period. Instead, you repay us taking a percentage of your credit card sales each day until you’ve reimbursed the balance and the fee agreed on.
Why use rapid advances over a business loan?
Even though business loans have been a popular choice for funding because of the overall lower costs, cash advances are proving to be a better solution for some businesses.
Business loans have stricter eligibility requirements, and in months with slower sales, you still owe the full monthly repayment. Especially for those businesses where the card transactions vary from month to month or from season to season, the cash advance can be the perfect solution. The main benefit is that you repay at your own pace. Or to be precise, at the speed your business grows. Because repayments rise and fall with your sales, you’ll never need to worry about being short at the end of the month. And because there’s no fixed term for the repayments, there’s never any pressure. Business cash advances are a safer alternative to business funding because there is no such thing as a missed payment.
Type of businesses that use Business Cash Advances
We welcome all UK based limited companies, sole traders and (unincorporated) partnerships. We offer flexible finance solutions for all UK businesses. That includes retailers, restaurants, hotels, pubs, hairdressers, beauty salons, service providers and more. Companies use our product for all sorts of purposes, from bridging short-term cash flow gaps to purchase stock or refurbishments.
What our customers are saying
“Our recent experience with Merchant Money was faultless from start to finish, and I have no hesitations in recommending them for their professionalism and efficiency when handling our recent financing needs for the business. Their plain speaking and simple approach to our needs gave us the confidence that we were working with a finance house that genuinely wanted to go that extra mile in helping us find the best solution in the most cost-effective way possible. We would never approach any other finance provider without giving Merchant Money the opportunity first”. – Dominic Boyett, Director UE Coffee Roasters
“Fortunately, Merchant Money understands my business and have assisted me in improving my facilities several times. The process is fast and straightforward, and the MM team is excellent to deal with. I will definitely partner with it again.’’ – Martin Horner, Director The Borough
Other Business Loans we offer
Frequently Asked Questions
We can provide you with an advance up to 100% of your average monthly card turnover, to use in any way your business needs.
You receive an advance and the total repayable is calculated by what we call a factor rate. This is typically between 1.2 and 1.3. If £10,000 is advanced to you, the total repayable would be £12,000. Please note that we assess each applicant individually based on their risk profile and personal circumstances. Each application we receive is different and subject to the businesses’ status and circumstances. We try to make responsible credit decisions based on a wider range of criteria and credit data.
Please note that a merchant cash advance is not a loan. There are no large monthly repayments, no variable interest rates and no fixed term.
We would need to review 3 months’ bank statements, your last 6 months’ merchant statements and in some cases we ask for filed accounts.
We will agree upfront a daily percentage of your card sales transactions – and this will be automatically deducted by the processor. So the payment will fluctuate directly in proportion with your daily card sales.
Speak to one of our online consultants
or call us on 0800 848 8480