Avoiding Business Loan and Credit Card Processing Problems

Business loan strategic solutions and credit card processing are more connected than most business owners realize, and changes to either are likely to have measurable impacts on business profitability. Merchants should take advantage of profitable business loan benefits by successfully coordinating credit card processing and credit card financing. The business financing benefits will be especially noticeable if several typical credit card processing and merchant cash advance difficulties can be precluded.

Even thriving small businesses frequently need more cash than they can borrow from a bank. One of the most important commercial financing needs for any business is ensuring that short-term cash requirements are successfully met. This is frequently a difficult task.

The implementation of an appropriate merchant cash advance program has become an invaluable business financing strategy for businesses experiencing a shortfall of short-term cash. Despite the obvious urgency involved in meeting day-to-day cash needs, business owners should be prepared to deal with several potentially serious problems when they obtain a business cash advance via credit card financing and credit card processing.

The Use of Credit Card Processing and Credit Card Factoring

Up to $300,000 can be obtained from a business cash advance based on sales volume and future credit card sales for a business. Most business owners can easily document sales volume and credit card processing activity, so sales volume and credit card processing activity becomes a financial asset to the business.

Suggested Business Loan Strategies for Common Business Cash Advance Difficulties

There are a number of critical problems that business owners should be aware of before a business cash advance is obtained. The most serious problems associated with credit card processing and business cash advances are listed below so that they can be easily avoided by businesses. Recommended and Preferred merchant cash advance and credit card processing requirements are shown after each potential credit card factoring problem.

(1) Business Cash Advance and Credit Card Processing Problem to Avoid: Closing costs. Preferred and highly recommended business cash advance requirement: No closing costs.

(2) Credit Card Factoring and Credit Card Processing Difficulty: Initial up-front fees. Suggested merchant cash advance and credit card receivables requirement: Up-front fees not required.

(3) Credit Card Factoring and Credit Card Processing Difficulty: Collateral required. Suggested merchant cash advance and credit card receivables requirement: No collateral requirements.

(4) Credit Card Factoring and Credit Card Processing Difficulty: Financial statements required. Suggested merchant cash advance and credit card receivables requirement: No financial statements required except for larger business cash advances.

(5) Credit Card Processing and Credit Card Financing Obstacle to Anticipate and Eliminate: Required to pay off the merchant cash advance with fixed payments. Recommended and preferred credit card factoring requirement: Fixed payments not required.

(6) Business Cash Advance and Credit Card Processing Problem to Avoid: Fixed term to pay off the business cash advance. Preferred and highly recommended business cash advance requirement: No fixed term for repayment.

(7) Credit Card Processing and Credit Card Financing Obstacle to Anticipate and Eliminate: Several years in business required to qualify. Recommended and preferred credit card factoring requirement: one year in business.

(8) Business Cash Advance and Credit Card Processing Problem to Avoid: high credit scores (680 to 700 or higher) required to qualify. Preferred and highly recommended business cash advance requirement: Credit scores of 500 or better.

(9) Credit Card Processing and Credit Card Financing Obstacle to Anticipate and Eliminate: $50,000 maximum business cash advance. Recommended and preferred credit card factoring requirement: $300,000 maximum cash advance.

(10) Credit Card Factoring and Credit Card Processing Difficulty: 12 to 24 months of credit card sales required. Suggested merchant cash advance and credit card receivables requirement: Most recent six months at $5,000 or more in sales.

Can the Ten Credit Card Factoring Obstacles Discussed Above Be Avoided in All Cases?

Absolutely. There are credit card financing programs which preclude all of the difficulties listed above. It is not prudent to accept any of these ten obstacles to receive a merchant cash advance based on credit card sales and credit card processing activity.

It is not likely that all ten of the described obstacles will be pertinent for all business owners. Business borrowers are likely to experience several of these problems if they are considering a business cash advance that uses credit card factoring and credit card processing.

Copyright 2005-2007 AEX Commercial Financing Group. All Rights Reserved.

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Stephen A. Bush and AEX Commercial Financing publish the Commercial Mortgage - Commercial Loan Guide and free Credit Card Processing - Working Capital Reports
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