AEX Commercial Financing Group

Business Cash Advance Programs

Business cash advance programs and specialized small business funding strategies are often confusing and under-utilized by many businesses which in fact need additional working capital for recurring needs such as inventory and marketing. First and foremost, we want to encourage any business owner to contact AEX Commercial Financing Group directly so that we can help remove some of the confusing aspects about this vital business financing strategy for complex business loans. To assist in this process, we regularly update several related working capital management and credit card processing blogs in order to provide current perspectives and commentary. We have also published a number of articles such as the following to assist in providing a better comfort level for business owners evaluating this approach.

There are several business financing problems to avoid when using this strategy, and a merchant cash advance is not the only source to consider for additional working capital. Most businesses which accept credit cards can obtain a business cash advance by using future credit card processing activity. This approach is also known as as credit card financing and credit card receivables factoring.

Business cash advance and credit card processing management is frequently one of the most overlooked sources of working capital for a business. This article will provide a concise and practical introduction to what a business needs to know about using this business finance strategy and how to obtain a merchant cash advance.

Businesses should not overlook the substantial working capital business loan benefits which will accrue to their business by effectively coordinating merchant cash advance and credit card processing programs.

Improved cash flow and reduced costs are key results of successful coordination of these business financing services. Perhaps most importantly, a business cash advance based on credit card processing is one of the few viable options for reliably obtaining short-term commercial financing for many service and retail businesses.

Before we begin, there are two key points to keep in mind. First, business cash advance programs can be a source of confusion and problems, and proper anticipation of these potential difficulties is essential for a business owner considering this working capital strategy. Second, business cash advance programs are often referred to by other names such as credit card financing, merchant cash advance and credit card receivables factoring. 

Although this is a sound and viable strategy, there are pitfalls to anticipate and avoid. Here is a suggested process for reviewing possibilities to improve credit card processing and simultaneously obtain a business cash advance.

Realize that the business cash advance strategy is usually not readily available until a business has been operational for at least one year.

A further limitation is that the business must have been using credit cards as a form of payment by customers. New business owners will nevertheless be wise to educate themselves about this business finance strategy in preparation for possible application a few months down the road.

Determine how much additional working capital your business needs.

In general a business cash advance is typically possible for amounts varying from $5000 to $300,000 and the amount will depend on the monthly credit card processing volume for a business.

Review your monthly credit card volume as well as cash receipts from your customers during the past six months.

It is not unusual for a business to experience cyclical variations in their monthly receipts, and these fluctuations are generally acceptable in calculating the potential for a business cash advance.

Avoid business finance sites which request that a business owner submit an online application for a business cash advance.

To illustrate the problems associated with an online business financing application, we have prepared a separate business loan report entitled How and Why to Avoid the Online Business Loan Application Trap.

Talk to an experienced business cash advance advisor.

You should avoid high-pressure representatives that make unrealistic promises about how quickly the credit card financing process can be completed. A realistic expectation is that a merchant cash advance can be finalized in a period of two to four weeks. A knowledgeable working capital financing advisor will be able to provide an initial assessment of potential working capital advance options based on information referred to above.

Explore additional resources that will facilitate a better understanding of complex credit card factoring issues.

You should look for sources which will provide relevant strategies and solutions for any business owner contemplating a future business cash advance.

Complete an initial business cash advance application once you are satisfied that you have identified a suitable advisor and provider for coordinating the credit card processing and credit card receivables factoring.

Please remember our advice to avoid the online versions for this step. Faxing or emailing a completed application directly to the advisor-provider is the preferred method for submitting initial documentation. Please note that there should not be any up-front fees or closing costs to obtain a working capital advance.