Unlock Funding: How to Qualify for a Merchant Cash Advance
In the quest for swift and flexible business financing, Merchant Cash Advances (MCAs) have
emerged as a viable option for many enterprises to unlock funding. Understanding how to qualify for an MCA is
crucial for businesses seeking this expedited funding solution. In this blog, we’ll outline the
typical eligibility criteria that businesses need to meet to secure a Merchant Cash Advance.
Understanding MCA Eligibility to Unlock Funding
1. Time in Business:
While requirements vary, most MCA providers prefer businesses that have been
operating for a minimum duration, often ranging from six months to a year. This criterion
demonstrates a level of stability and a track record for the MCA provider to assess.
2. Average Daily Bank Balances:
MCA providers may review a business’s average daily bank balances to evaluate its
financial health. This metric helps assess the ability to manage daily repayments and
potential holdback percentages.
3. Consistent Monthly Revenue:
A steady monthly revenue stream is a positive indicator for MCA qualification. Providers
want to ensure that a business has the ability to generate sufficient income to meet
repayment obligations.
4. No Recent Bankruptcies or Legal Issues:
MCA providers are likely to check the business’s financial history for red flags. A recent
bankruptcy or unresolved legal issues may negatively impact eligibility.
5. Business Type:
While many types of businesses can qualify for MCAs, some providers may have
preferences or restrictions based on industry. Understanding the provider’s stance on
your specific business type is essential.
6. Credit Score Consideration:
While not always a primary factor, some MCA providers may consider the business
owner’s credit score during the evaluation process. However, MCAs are known for being
more lenient compared to traditional loans.
The Importance of Preparation to Unlock Funding
Navigating the eligibility criteria for Merchant Cash Advances requires careful consideration and
preparation. Here are a few tips:
Gather Financial Documentation:
Ensure that your financial records, including bank statements and transaction history,
are organized and readily available.
Understand Your Numbers:
Have a clear understanding of your average daily sales, monthly revenue, and average
daily bank balances.
Check Provider Requirements:
Different MCA providers may have slightly different criteria. Familiarize yourself with the
specific requirements of the provider you are considering.
Merchant Cash Advances can provide a lifeline for businesses in need of quick capital. By
understanding and preparing for the typical eligibility criteria outlined above, you can increase
your chances of qualifying for an MCA. Remember, each MCA provider may have variations in
their requirements, so it’s essential to do thorough research and choose a provider that aligns
with your business needs and financial profile. Apply online today!
