Starting a business can be a difficult task. However, keeping it relevant and thriving is a different situation. Many business owners have had to make lots of crucial decisions and sacrifices to ensure their business flourishes. One of the major factors that hinder business development is financial involvement. A projected 90% of business starters always encounter some financial crisis upon inception, and two-third of that percentage struggle to keep their business running for more than a year. The business world is a competitive one and no doubt requires sufficient funding to improve potential gain. The idea of seeking financial help from friends and relatives will not always be available among other perceived cheap loan opportunities. Such is why business owners should always be prepared to try other loan options, such as cash advances.
What to Know About Cash Advances
Cash advances are short-term loans. These loans are usually provided by banks, credit card issuers, and certified lenders. There are various ways in which a business owner can get a cash advance loan. They are as follows;
- Credit Card Cash Advance: The credit card cash advance is an option that is mostly used by individuals. As the name implies, it involves using your credit card to withdraw a specified amount of money allocated to you by the bank. Some credit card companies also allow the use of checks to access these loans.
- Merchant Cash Advance: A merchant cash advance is usually provided to business owners by alternative lenders. These lenders could be companies that focus solely on offering loan deals to people in need of them. They could also be loan merchants or representatives from banks. One benefit merchant cash advance has over credit card cash advance is ignoring the credit score of the loan applicant. It would be best if you always took your time in choosing merchant cash advance best for you.
- Payday Loans: Payday Loans have a significant difference between a credit card and merchant cash advance. Such distinction is that the amount to be loaned to the business owner depends on the applicant’s wages or salary received. Payday loans have significantly shorter lease periods, and loans must be settled immediately when the borrower gets his/her paycheck.
How Cash Advances Can Help Grow Your Business
There are usually mixed feelings towards going for a cash advance due to the negative impressions created by loan websites, such as high-interest rates and short lease terms. However, high-interest cash advances aren’t as bad as they are portrayed. They can prove to be vital in the following ways;
- Cash Availability: Cash advances provide cash quicker than any other loan option out there. It can come in handy when you are in desperate need of money to upgrade your business. However, due to its short term loan feature, you must be prepared to settle it in no distant time.
- No Complexities: Cash advances are very straightforward and do not require unnecessary documentation and applications.
Cash advance will always remain one of the best ways business owners can kick-start their dream business without the hurdle of capital-seeking. However, it is always advisable to scrutinize the terms and condition thoroughly when obtaining one from a reliable company.