An Alternative to Waiting for Business Loans

Often the most tense part of small business ownership is acquiring capital to maintain and sustain gradual growth. This is even more true when you are seeking business loans. There is a mistaken belief that restaurants are more apt to fail than any other niche; a ten percent success rate is often quoted.

The fact is that at the five-year mark restaurants have 40% success rates, nearly identical to kinds of small business. Nevertheless, it can be difficult to get financing, especially from traditional locations such as the local bank.

Business loans can also be acquired from credit card processing vendors as a factoring agreement. These vendors give financing options that range from a few $1,000 all the way to $250,000 if necessary. The business owner is effectively selling their future Visa/MasterCard revenues at a discount in order to get the cash that are necessary right now.

The merchant cash advance is repaid by way of a credit card factoring based agreement. A percentage of credit card receipts are paid back based on a "Daily Capture Rate" that is agreed upon before getting the funds that means that on a slow business stretch of time the advance can still be paid without having to face repercussions.

When you are running a restaurant it can be difficult to anticipate when you will need to have additional cash on hand. Start up costs can be larger than expected, and the first large problem can be a "make or break" event. Even if the business owner has impeccable credit, it can take months for a bank loan to be funded; in the meantime, business continues to hurt.

Credit Card Factoring agreements give a much needed, speedy solution for restaurants in need of funding. Neither collateral nor years of financial statement are necessary to be approved for restaurant loans when you work with a trustworthy financing agent.