With no money coming in from consumers, and banks not approving loans, small businesses have been shutting down or on the verge of it.
If the business has an acceptable credit history and shows good credit card sales, business owners can get a merchant advance within 2 weeks to support their business.
The survival of small businesses is integral to the economy
Small businesses contribute to the U.S. economy in a big way. According to the 2004 census, there were at least 25 million small businesses in the United States, with 600,000 new businesses adding to the count every year. These businesses account for at least 50% of the employments in the private sector.
Closure of small businesses leads to the loss of wealth and employment in the economy. Lack of funds is forces small businesses to lay off employees or shutdown service. It is vital that small businesses have the necessary funds to survive this lean time and continue to generate revenue and employment.
With this end in mind, the U.S. government in 2008 and 2009 facilitating funding of banks to prop them up and encourage business loans. However, getting loans from banks is still very tough, even with good credit scores. The approval process is stringent and time-consuming. A failing business cannot afford the time lost in waiting for a loan when it needs funds urgently.
MCA providers have an efficient system that allows businesses to get the business advance fairly quickly. The funds can be utilized immediately to keep the business going while it adapts to the new economic environment. MCA providers have played a key role in keeping many businesses on their feet.
MCA industry a successful player in the new lending market
The new lending market is seeing the rise of the MCA industry. Traditional bank loans are still an option for business financing but need to rethink their loaning strategy to be useful to struggling businesses. The MCA falls more costly than a bank loan, but it places trust in the business’ capability to perform. The MCA provider gets a percentage of the credit card sales and is with the business in good times and slow times. As MCA does not require posting of collateral, the business owner is saved the worry of losing personal assets.
The MCA industry is regulating itself to shakeout disreputable providers looking to rip-off desperate small business owners. Top MCA providers are setting a benchmark for other providers to ensure the MCA industry stays in business.
Small business funding is a lucrative industry. With the change in the lending market, more players can be expected to enter the arena to fulfill this need. Small business owners will have the option to choose from various financing sources. In today’s unpredictable environment, the MCA industry stands out for its convenient, fast and flexible financing options.
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