Facebook Instagram Linkedin
.

Call experts

844-423-8623

Merchant Cash Advance

What is a Merchant Cash Advance

A Merchant Cash Advance (MCA) is a revenue-based financing opportunity provided to small to medium-sized businesses. Funds are advanced against the future revenue of the business, purchased at a discount to their likely value. Payback is made as a percentage of the daily or weekly revenue. Instead of an interest rate and term as with a loan, an MCA is a fixed cost of capital that has a variable time from the daily or weekly remittances as a percentage of revenue until repaid. This enables the business receiving the MCA to operate in a healthy manner while repaying the MCA.

 
cash-1

Why is a Merchant Cash Advance the Right Solution?

Businesses have varied needs for capital and at Two River Funding we focus on growth opportunities. These include expansion of facilities or equipment, purchase of discounted inventory, buffering cash flow due to seasonal spikes, and others. We do not fund ‘bandage’ capital where a business is in trouble.

MCAs provide businesses with an alternative to other types of business loans that may be harder to get, such as business lines of credit or traditional bank loans. An MCA can be a funding option for businesses that have high credit card sales volume, high daily deposits, need funding quickly, and may not qualify for other business loans. It is also an alternative to selling equity in the small business.

Merchant cash advances are extremely flexible, especially in the amount of funding and the payback. A qualified business can usually access capital quickly to cover some of the following use cases:

  • Temporary cash flow. If you’ve had an unexpected downturn in your cash flow and need help covering payroll, utility bills, leases, and other payables, an MCA may be a quick and easy solution.
  • Purchasing inventory at a deep discount. Many businesses that deal with inventory, such as retail, restaurant, or e-commerce businesses, may want to purchase inventory when they can take advantage of significant discounts. This can be particularly helpful when supply-chains are bloated or a distributor is overstocked.
  • Unplanned expenses. If an important piece of equipment has broken or another emergency arises, you can use an MCA to cover the cost quickly.
  • Working capital. Getting an MCA may be helpful for short-term working capital needs.

If a business has reliable revenue, an MCA may be a great short-term or interim financing solution.

cash-4

Ready to Apply?

Start Your Application
Two River Funding