A business cash advance is a lump sum payment that is taken up by a business in return for a fixed percentage of future credit or debit sales. They’re a smaller, more convenient alternative to traditional bank loans as they are characterized by short-term, regular payments.
Enabling a business to sell a certain portion of its future sales in the present makes it easier for small businesses to gather funding in order to pay its operational expenses and to undertake growth.
What is a business cash advance? How does it work?
When a business decides to sell its future sales to a finance company in order to secure immediate funds, the finance company reviews their credit card and commercial sales along with the bank statements and other necessary documents to understand the financial position of the business and its future sales potential.
A business cash advance can help you secure funds immediately.
Once that has been approved, the funding amount is calculated by evaluating the sales potential and the perceived risk of the company’s account. The funds are then transferred to the respective account after approval. The returnable amount is then determined by a “return factor” that is multiplied with the financed amount.
The amount can then be returned over the agreed period of time as the business proceeds on making sales.
Benefits and Risks
In order to secure a business cash advance, there is no need for the business to go through the lengthy process of applying for a loan. Moreover, the advances can be obtained very quickly, usually just over the course of a few days. This makes it a very viable option for companies that are looking to attain financing on urgent basis for any growth or operational needs.
You can get an advance fast – in just a few days.
We recommend only taking this option if you’re pretty sure about your upcoming sales being able to cover the cost.
When obtaining a cash advance, a business does not know what the future holds. It doesn’t know for sure what the future of the market will be and whether or not will it be able to make the sales that it is about to promise. This is what makes it a somewhat risky option to undertake funding because once taken up, the cash has to be paid back with an additional percentage, which can be troublesome if the business fails to expand and make sales.
A Fast, Short-Term Solution
Moreover, the business cash advance option is best as if you simply want a short-term solution to your funding needs.
If a business has a continued deficit and is suffering losses due to a fault in their product or any other issues, a cash advance is not the solution. It will only bury the business under more debt and a permanent solution has to be figured out in order to cater to the financial needs of the business properly. So make sure you think about whether it’s right for you before jumping in with both feet.
We offer the most comprehensive opportunities to obtain a business cash advance with the least amount of risk and no hidden policies.
We require no collateral for your advance cash, and the repayment process is extremely convenient. The pre-qualification process for First Capital Business Finance is simple and hassle-free, which leads to the receipt of finance by our customers in under 10 days. Additionally, we pay little attention to any bad credit that your business might have because our greatest priority is the convenience and provision of opportunities to our clients.
As easily attainable as a business cash advance is, it is not always the most suitable option for all business types and situation. Our company is committed to fulfilling all the needs and requirements of our clients to the best of our ability no matter what sort of financing they require.
Our greatest priority is the convenience and provision of opportunities to our clients.
Commercial Truck Financing
Commercial truck financing is one of the options of financing that are available for commercial trucks that can include past experiences that are the source of any sort of bad credit, minor bankruptcy and any repossessions.
The list of equipment we can help you finance is available on our website along with a list of the types of business we cater to and other specifications. By no means are those lists exhaustive – in fact, we fund most businesses!
So no matter what you’re looking for, give us a call today!
Get the Cash Your Business Needs from First Capital
We also provide traditional business loans that are super convenient and can help you recover from any bad cash flow situation. Our loan program provides quick approvals in under 24 hours and the funding can be attained in as few as 5 days.
For the complete steps to follow in order to achieve a business and other qualification requirements, click here.
In addition, First Capital Business Finance provides numerous other sources of financing to startups and already established businesses with a focus on making the whole process extremely convenient and keeping the needs of our clients #1. Contact us today at 888-615-7623 to learn more about the opportunities that await you and your business.
What is a business cash advance? | First Capital Business Finance