American Express Closes Business Lines of Credit
With many businesses surprised by American Express closing it business line of credit as part of its positioning for federal bail-out, many retail store owners are quickly turning to the alternative business funding option of merchant cash advances. US Business Finance Corp extends business cash advances to merchants who accept Visa and MasterCard charges on sales. These business cash advances are paid back over a few months from a fixed percent of future credit card sales.
With the Thanksgiving to New Years consumer spending season starting, the need to keep operating capital flush has many merchants feeling the pinch of a reduced or closed business line of credit. With time of the essence, the short qualification period of business cash advances appeals to many businesses who do not have the time available to go through the laborious traditional bank financing route.
With a merchant cash advance’s no need for collateral, this alternative financing route does not add additional liabilities to a company’s Balance Sheet in the fourth quarter. The lack of collateral is due to US Business Finance Corp taking on the lion’s share of the risk, a risk banks and traditional lending institutions do not accept.
Is this blind faith? Not really, US Business Finance Corp has the experience of working with owners and we know how hard they work to make their businesses a success. Traditional financing, in some ways, appears to be geared to businesses whose level and history of success leaves them in no need of financing. Typical businesses that are new or growing have a harder time meeting the criteria for bank loans.
With business cash advances, owners can use their future sales, based on their past track record as a way to raise capital. US Business Finance Corp’s company cash advance does not tie up your future sales as factoring does, but simply takes a certain percentage of the sale until the cash advance is repaid. Typically this period is from six to nine months.
If your line of credit has been closed or reduced, turn to the financing experts at US Business Finance to see how our merchant cash advances can turn your future sales into current capital.
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Filed under: Alternative Capital, Banking Industry, Business Cash Advance
