To start your own business, you need a great idea, solid business plan and money to get your idea off the ground. There are many options that your business has when it comes to getting the money it needs, but merchant services loans might be the best way to get the money needed. Why should a new business consider this type of loan?

Easy To Get

Merchant services loans are a cash advance for businesses that have little to no credit history, or have credit issues in the past. Most applications are going to be approved, which is good when you have to make payroll, or you want to spend more money marketing your product. Spend more time worrying about marketing your company and less time worrying about how your credit could potentially hold you back.

Unsecured Loan

The best part of getting this type of loan is that you do not have to put up any collateral. Whenever a loan is tied to an asset, it can be harder to get out of the loan should anything happen. This is because your creditor can simply seize the asset and sell it off for the cash. When you get a merchant loan, you get the benefit of an unsecured loan without having to have the higher credit score that is usually required to have your loan be unsecured.

No Set Loan Repayments

One of the more flexible features of a merchant loan is that you don’t have any set repayment terms to deal with. You pay the money back as your revenues grow, so you don’t feel pressured to make payments before your company is ready to pay back loans. Taking larger orders, and generating more revenue, can be difficult if your business is lacking the money to do so. If your company is new and growing, this can be a great way to grow your business while being able to focus on your company instead of your finances.

Your business needs time and money to grow into the best company it can be. When you know you have a source of working capital that can fit your needs and allow your company to pay its obligations on time, it will become a stronger company in the long run. Over time, as the company obtains a longer credit history and more positive credit history, it will qualify for more traditional financing. However, a merchant service loan can be a great option until that point is reached.

Credit card processing accounts allow businesses to accept credit cards for payment against goods and services. Usually, the merchant accepts the credit card payment through his or her point of sales device and is funded by the credit card processing company, usually by the next business day. However, if a business owner determines that he or she needs a loan in order to expand the business or cover current operating costs and does not qualify for a traditional business loan product, he or she can get a credit card processing loan.

Credit card processing loans allows a business owner access to a lump sum of cash in exchange for future credit card processing deposits. In a sense, this is not a traditional loan product, but a cash advance type arrangement. Here’s how it works:

• A business owner who accepts credit card payments in their business locates and applies for a credit card processing loan through a credit card processing lender.
• He or she receives approval for the loan, which is based on monthly credit card processing volume instead of traditional credit underwriting guidelines such as credit history and score.
• The proceeds of the loan are direct deposited into the business’s checking account, usually in 72 hours or less.
• The loan is repaid with future credit card processing deposits

In most cases, there is no fixed repayment term, official loan payment due dates, or even payment amounts. The lender accepts a percentage of your daily credit card sales as payment against the loan until the principle balance plus interest and fees are paid.

There are several benefits to getting a credit card processing loan over a traditional bank loan. These include:
• Easy qualification terms. Most credit card processing loans do not require a business to meet specific credit guidelines with the exception of unresolved bankruptcies.
• Fast access to the cash. In most cases, approval for the loan occurs within 24-48 hours and funding occurs anywhere from 3-5 days from the date of application.
• There is no collateral required-this means that the business owner does not have to pledge any personal property against the loan to reduce the risk of default. However, he or she will have to pledge future sales against the loan to ensure repayment.
• In most cases, the loans are automatically eligible for renewal after repayment. This means that if you find that you need additional working capital, you can take out a new loan the day after your existing loan is repaid.

In order to qualify for a loan, you will have to meet a few certain criteria. These include:
• Your business will need to have been established for a minimum of 4-6 months prior to applying
• You will need to accept credit cards in your business for payment
• Your monthly credit card volume will need to meet the lender’s minimum requirements, usually $3500 to $5000 in monthly volume
• Some lenders will require that you have some documentation that supports you will remain in business for at least a year from the date of your application, such as a business lease.

These criteria may exclude some businesses from being able to obtain such a loan, however the relatively loose underwriting criteria means that most applicants will have access to the money they need to keep their businesses going. Your loan amount will depend on your monthly credit card processing volume, meaning that the more you process, the more you will be eligible for. However, new customers should expect their loan terms to be somewhat lower than a returning customer.

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The Holidays are once again upon us.  Black Friday has come and gone and many business owners are in full-on “get through the holidays” mode.  With millions of Americans hitting the street and the computer looking for the perfect gifts for loved ones, business owners have a lot to worry about at this time of year.  “Do I have enough inventory?” “Am I properly staffed to handle the excess business?” “Have I done enough advertising to draw the holiday crowds to my business?”

There are different concerns for different business owners, but one thing is for certain, most concerns in the minds of business owners involve spending money to make money.  That’s where we come in.  The holiday season is the most important time to secure funding for your business because it’s money that can be used to bolster your holiday season (pulling in more profits) or money to have in reserve for when the holidays are over and business slows down to a crawl again.

It’s funny how American commerce has evolved over the years to have this one month of absolute consumer insanity followed by a near pause in the spending of most American consumers in January and February.  And moreover, many business owners resist the temptation of taking cash at this time believing if they need some cash flow help in january, they will be able to get it when business slows down.  Unfortunately, most lenders are reluctant to lend in January due to a concern with the lull in business making it more difficult to secure funding after the holidays.

So it’s encouraged to sure up any funding you may think you need before the holidays are over.  Now is the time to take out a line of credit, or a business cash advance, or a small business loan to make a final push for the holidays or prepare for the post-holiday lull.  Sure Payment Solutions understands what business owners go through during this time and we are here to help make sure you never have to worry about the ups and downs of business.  Simply fill out a form on this website or call us today at (800) 991-3917.

Over the past 6 – 12 months the small business lending community has seen a significant shift in lending programs to these ACH debit programs.  These programs are set up in a couple of different ways, but the common denominator is that they are all paid back by the lending company debiting payments directly out of the borrowers bank account on a daily basis.  Some companies do this by setting up a fixed daily payment that is agreed upon before the funds are sent out, while others agree to debit a fixed percentage of all deposits made into the bank account (also agreed upon upfront).

Unlike traditional lending programs, these are based heavily on the specific cash flow of the borrower’s business.  Daily payments are a blessing for some business owners and a curse for others.  Many business owners have trouble managing large monthly payments and having the lender debit their bank everyday is more manageable from a planning standpoint.  The payments are smaller and more frequent so it is easier to plan for them to be a part of everyday business, while a once a month payment can come at an inopportune time and late fees can accrue quickly.  The business owner is also generally in charge of making sure the payment is made, not the other way around.

Still, the daily payments are more difficult for other business owners who rely on their everyday cash flow to purchase inventory and manage bills, and a monthly payment is more palatable.  However, the lending community has shifted to this model because it puts the control in their hands, and they are likely to know about a problem more quickly than they would with a once a month payment schedule.  This type of lending has quickly replaced merchant cash advances as the primary business funding alternative to a traditional bank loan product.  It can work for a much broader audience and doesn’t require anything in regards to merchant accounts and merchant processing history.

In fact, many cash advance providers have begun offering a program in line with this need to better serve a wider variety of clients.  It has proven to be a productive program on both ends and many business owners who qualify for traditional loans or merchant cash advances are opting for these daily ach debit programs.  They are more difficult to qualify for than traditional cash advance programs, but many business owners like that it has nothing to do with their credit card processing.  Furthermore it allows those cash advance providers to reach businesses where credit cards are not a primary form of payment, which has opened the doors to increase the lending pool by a great margin.

If you’re a business owner and are interested in getting some money for your business, then inquire about our loan programs, particularly the ach debit based loans so that you too will have a chance to take advantage of the newest loan product available on the market today.

This week marks the first time business owners will receive their credit card processing statements and have something new to look at in a long time.  For some, the October 2011 processing statement will reveal vast savings passed through from the Durbin Amendment automatically, while others will look at their October 2011 processing statement expectantly only to be disappointed and find that they have paid the same as they did in September.  As if credit card pricing and costs were not complicated enough, this new amendment adds an additional layer of complexity that we will attempt to break down.

I mentioned above that some people will see instant savings.  The business owners who are seeing changes in their rates are most likely on an interchange plus pricing model, this pricing model maintains a fixed markup above cost on every transaction, and since the Durbin Amendment essentially lowered “cost” on debit and check card transactions, the savings are built in to the existing pricing structure.

For those business owners who are on a tiered pricing model, the savings will not be instant or passed along in the same way.  If you look at your statement, and you can’t tell much of a difference in how much you are being charged, then chances are you have not received any discount owed to you from the Durbin Amendment.  The best way to achieve this goal is to establish a new contract with new pricing that will pass along the Durbin savings.  At Sure Payment Solutions, we have been preparing for the Durbin Amendment to go into effect and are prepared with a variety of tools to help business owners understand their rates and just how much money they can save.

The full effect expected from the Durbin Amendment has yet to take shape, but it is clear that from a consumer standpoint, Debit cards are not what they used to be.  Banks have begun charging monthly fees and usage fees to card holders to offset some of the losses suffered by the cap on interchange fees for debit and check card categories.  Historically, Debit cards were a cheap and easy alternative to carrying cash, but now that there is a cost associated, it is likely that debit cards will become increasingly less popular.  The snowball effect from this essentially reduces the effectiveness of the Durbin Amendment as fewer consumers use debit cards, fewer merchants accept them (despite the savings) and suddenly all the “good” Durbin did will be null and void.

At this point there is very little we can do to change any of that.  Instead, what we can do is ensure that our clients receive the best and lowest rates available thanks to the Durbin Amendment.  The average customer is saving hundreds of dollars every month and all it takes is a simple phone call.  Account representatives will be standing by to speak with you.  Let us analyze your October statement with you and we’ll be able to tell you if you’re getting the Durbin Savings already or not.  From there, its simply your decision whether or not you want to take advantage of this historic amendment or allow it to pass on by.