How to Choose the Best Merchant Cash Advance Provider

What to Look For in a Provider

Since the merchant cash advance industry is still new, there are a variety of businesses already claiming their stake in the growing market. As the market expands, it’s giving rise to both responsible lenders, as well as, unscrupulous ones. Providers can range anywhere from large corporate providers who offer MCA funding as a secondary part of their financial services, to small, independent companies whose primary focus is merchant cash advance. So how do you choose the best provider?

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Here are 4 key factors to consider when seeking a merchant cash advance.

1. Financing experience

Considering the merchant cash advance industry is still relatively new, it’s important to know if providers have real experience helping other businesses through financial hardships or if they are just chasing the latest hot trend. You want to develop a relationship with a company that plans to be around for a long time. Look for a provider with significant financing experience. Research prospective providers’ backgrounds, including how long they’ve offered merchant cash advance services, which companies they’ve previously worked with, and their overall customer satisfaction rating.

It’s also important to make sure you choose a provider that has worked with businesses in your industry and similar in size to yours. Some industries, such as law firms and medical billing companies, can have statutory regulations or state and local laws which restrict merchant cash advance transactions. For example, if your business accepts customer retainer payments for future services, you may be limited in how you can use a merchant cash advance. Picking a company that has industry experience assures your company complies with any applicable rules or standards.

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2. Level of interest

Quality merchant cash advance providers are concerned with what is best for your business. They take the necessary steps to learn as much as possible about your business to find out how much money you need, and if you can realistically pay it back. Stay away from companies who ask no questions about your business, try to steer you toward a too-high advance amount or propose unrealistic repayment terms. Think of it this way, if a provider isn’t willing to take the time to talk to you when it’s trying to win your business, what will it be like after the deal is done?

3. Upfront about transaction

A trustworthy provider will make you feel comfortable with the transaction from beginning to end They can help you understand the benefits of MCA for your particular business and will be honest and upfront if repayment terms are unfavorable. Look for lenders that are generous with information and take the time to explain their repayment costs, terms, and the application process.

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4. Accessibility

Your relationship with a merchant cash advance provider doesn’t end after your application gets approved. You’ll be in regular communication throughout the repayment process, so it’s important to be confident the provider will be there when needed. The provider you choose should offer solid, reliable customer service before and after you agree to work together. Choose a provider that is easily accessible and able to negotiate new terms if necessary. For example, if an unexpected business slump or accelerated expenses arise, your provider should be wiling to find a solution that benefits both parties.

No matter which provider you choose, evaluate all of your options before making a decision. Comparing terms and rates from different providers can be the best way to find out if you are getting the best deal available for your business.

Learn More
Find out more about the ins and outs of a merchant cash advance by reading our Merchant Cash Advance Buyer’s Guide.

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