merchant cash advance
TRANSCRIPT
The Merchant Cash Advance (MCA) industry has been in existence forover 12 years.
Approximately 500,000 merchants have utilized this product
MCA is a Purchase / Sale Agreement. This is NOT A LOAN!
The Cash Advances can be anywhere from $5,000 up to $250,000depending on the merchants average monthly credit card transactions.
Average advance is usually $20,000 and is paid back with via dailycredit card transactions.
Overview
Merchant Cash Advance
• National Average FICO is 652.
• A good FICO is 700.
• 48% of Americans are at 700 or above.
• Most banks require a min of 690 to get a loan.
• 13% of the population has a FICO above 800, while 19% have a FICO below 550.
FICO
• Approximately 65% of the MCA agreements renew the first year.
• Money can be sent in as little as 3 days.
• The cash received is not reported to any credit rating agencies.
MCA
Merchant Cash Advance
Why would a Merchant want a
Merchant Cash Advance?
Merchant Cash Advance vs. Loan
Merchant Cash Advance
Payment matches credit cards sales
No personal guarantee
Marginal Credit
No Collateral
Quick Turnaround
Easy Renewal
Loan
Fixed Repayments
Personal Guarantee
Good Credit Required
Collateral
Long Process
Many additional costs, from closing costs to CPA costs for Financials preparation
By The Numbers
• Merchant Cash Advance is the Factoring of future credit card sales at a discount
Factoring
• Standard of1.41 factor equates to a 29% discount rate
• Better rates may be available
Discount Rate
• 6 months is the standard term to payback the advance
• The duration would be based on credit card sales, and could vary
• At 6 month duration with a 25% retrieval (pay back) the merchant can qualify for an advance of up to 1 times monthly average credit card processing.
Duration
6 month Duration
25% retrieval rate
Advance amounts can be
100% of avg. monthly CC
sales
Retrieval Rates and Advance Amounts
Examples of Advance Amounts based on Retrieval Rates
6 month Duration
10% retrieval rate
Advance amounts can be
40% of avg. monthly CC
sales
Likely Prospects
Eating & Drinking
Establishment
Small Businesses
Retail Establishments
Auto Repair Facilities
Salons
Possible Reasons Cash is Needed
Inventory
Equipment
Expansion
Advertising
Unexpected Expenses
Add / Purchase
New Location
General Requirements
One Year in Business
500 FICO (credit score)
$5,000 monthly processing
15 credit card batches per month
Bankruptcy must be discharged at least one year
Evidence of release or payment plan for tax liens
At least 50% paid down on any existing advances
Vendor relationships are a dynamic part of our business. Teaming up with our
company allows you to focus on selling your equipment while we focus on what we do
best, Approving your clients.
Our Merchant Cash Advance program allows you to offer your customers the easiest
solution for an approval and fastest way to get you paid.
Vendor Relationships
Contact Us….
(516) 333-5571
(516) 333-6169
John
Parinello