Thursday, September 18, 2008

A Business Cash Advance: One Answer to the Credit Crisis

Business Week recently featured an article discussing the credit crisis we have now been enduring for a year. (

While this article primarily focuses on the effect the last 12 months have had within real estate markets, it also states: “The credit crisis has spread to infect the automotive, airline, travel, and retailing industries.”

What does it mean to a business owner operating within one of these affected industries?

Clearing the Hurdles of the Credit Crisis
A successful business will not let the credit crisis become the obstacle that prevents growth and maturation…they understand and employ a variety of financial options to get through it. When one financial strategy won’t work, perhaps another will.

Understanding different financial products and services and knowing how to use each to its greatest strength is one solid way to build and maintain success.

A smart business owner clearly understands the effect that the credit crisis is having on an ability to borrow from banks as needed. By knowing more about the current state of the economy, successful business owners are realistic in what they subsequently expect from banks.

Banks are tightening their requirements. Loans are going to be hard for many businesses to secure. Successful business owners need to have a few alternative options at the ready to stay competitive. Understanding and utilizing these alternative options can help to clear the hurdles of the credit crisis.

How Does a Merchant Cash Advance Play Into This?
As the Business Week article points out, it is becoming necessary for many businesses to move beyond traditional financial institutions.

A Merchant Cash Advance is one great option for many businesses—and it has been so for over a decade. If a small business has been rejected for a loan, this does not mean they will also be rejected for a Merchant Cash Advance. Different rules apply.

While the credit crisis is having a big effect on the banks, it is not having the same effect on stable, established Merchant Cash Advance providers. Use this to your advantage.

So let the credit crisis have its birthday. If the banks are saying “No” more than ever before, you may not be out of options to get business capital as needed. A Merchant Cash Advance offers you a sensible and reliable alternative to consider.

What Do You Think?
Do you feel like the credit crisis is making it more difficult to run a successful business?


Anonymous said...

I don't feel as though the current credit crisis is making my company harder to run, but it is making it much harder for me to turn a profit. I've also had some existing lines of credit that I was up to date with payments pulled out from under me. Are merchant cash advances really more readily available than lines of credit, and how much greater is the cost? Or is it?

The AdvanceMe Team said...

From what we can see, MCAs are still more readily available, probably because the underwriting and risk assessment are different.

As for the cost, the products are so different (one is a loan with an interest rate and a fixed maturity date while an MCA is not a loan and has no fixed maturity date), it is like comparing apples to oranges.

Instead of cost, owners often focus on the benefits of an MCA - retrieval amounts aligning with payment card sales, no personal collateral required, money as quickly as three days, etc.

Hope this helps, and thanks for the comment!