This article relies upon a series of candid and short explanations about merchant cash advances. In addition to the descriptions provided in this article, related reports that include “six words describing business finance options” and “commercial mortgage options described in seven words” should also be reviewed by small business owners.

The first explanation of merchant cash advances is “new funding sources are better than expected”. Small business owners will discover that the most effective business cash advance providers have been around for a number of years when they fire their current banker and then need to locate a new commercial funding source. These specialized commercial lenders were actively providing much-needed business financing to small businesses even during the worst of the recent banking crisis.

“Banks are the problem, not the solution” is the second observation pertaining to merchant cash advance options. Banks have severely decreased their commercial lending efforts to small businesses despite bank bailouts that amounted to almost a trillion dollars. Banks have created even more problems by eliminating business lines of credit and recalling commercial real estate loans. The number of troubled banks continues to increase. Lending by banks during 2009 fell by the largest amount in over sixty years. Small businesses still need a reliable source of working capital despite the failure of banks to provide adequate business financing. In the midst of the most troubling business banking environment seen in several decades, business cash advances (which are not funded by banks) have continued to be routinely available to commercial borrowers.

“There are ten potential problems to avoid” is a precautionary illustration of seven words to describe business cash advances. Small business financing options will typically be more complicated than anticipated by business borrowers. Since we have identified at least ten unique problems that can occur with business cash advance services, this potential for confusion will probably be even more likely when discussing merchant cash advance options. On a positive note, we have concluded that all of these specific difficulties can be avoided with appropriate efforts. Business owners should discuss their situation with a small business finance expert who can also evaluate alternative approaches for obtaining working capital financing in addition to merchant cash advances.

Our final observation is “credit card processing costs can be reduced”. Based on the expected volume of their future credit card processing activity, a typical merchant cash advance provides working capital to a small business owner. As future credit card purchases are processed, the amount of business financing is then repaid gradually. The use of business cash advance services is a perfect opportunity to evaluate whether credit card processing costs can be reduced, and these costs are one of the most significant expenses for any small business. When they learn how much they have been overpaying for their credit card processor, it is not unusual to hear a business owner express their surprise and disappointment. One of the benefits of working with established merchant cash advance services is their leverage in obtaining the best possible terms for processing costs.

Concise commercial finance explanations have also been employed in a number of other reports such as “six more words about commercial loans”. Business cash advances are emerging as one of the few effective working capital management alternatives for small business owners. Because this small business finance approach is not well understood by most business borrowers, this report provided a series of seven-word descriptions about merchant cash advance options.

Author Bio: Stephen Bush has delivered candid working capital management expert advice for over 25 years. He provides small business financing services, business consulting and merchant cash advances throughout the United States. Steve and AEX Commercial Financing Group are an experienced source of commercial real estate loans and specialized small business finance options.

Category: Finances
Keywords: merchant cash advances,merchant cash advance options,business cash advances,working capital,finance