April 19, 2024

Business Bib

Business & Finance Blog

A New Option for Small Business Owners to Get Quick Cash

2 min read

One of the biggest problems for a small business owner is cash flow. Making a profit is difficult enough, but when you have timing issues with money coming in and money going out, it can be difficult to operate your business without a temporary infusion of cash. Unless you have a lot of collateral to secure a loan or outstanding credit, it is going to be near impossible to get this money from traditional lenders. However, there are other options available to you. All of these options fall under the category of a merchant cash advance.  

No credit or collateral needed

These loans are short term and require no credit. Neither do they require any collateral in a traditional sense. One form of a popular advance for a business owner involves your outstanding accounts receivable. If you need money now, you can use your accounts receivable to get cash today. In essence, you are getting a cash advance on the money that is owed to you. When your customer pays you for the invoice, the lender will take payment for the loan.

The cost of an accounts receivable loan

This will vary with the lender and the nature of the accounts receivable. It is related to what your product or service, the businesses that owe you money and the estimate on how long it will take for them to pay. Naturally, the amount owed will be important.  The cash advance lender will take a percentage of the total amount of the invoice as well as any processing fees that are a part of the loan.

This type of loan can be approved quickly

This is one of the greatest advantages of a quick cash loan for small businesses. You are likely looking for quick cash, and these loans are processed quickly. Sometimes you can get your money as quickly as one day, but depending on the lender and your circumstances, it can be longer. Worst case, you can get your money within three days from the time you first apply.

If you need cash for your small business and you have poor credit or none all, and in addition, you have no collateral, you should consider using your accounts receivable to get the money needed. It is fast, and the process is easy to go through. Once you have done business with a lender, it will become an even faster process as you are a repeat customer.