How you can use a small business loan

Small business owners can use loans to grow their business. You can use the funds however you wish.

Cover Expenses

Pay for any unexpected expenses that arise.

Invest in your business

Use the loan to grow your business however you wish.

Payroll

Use the loan to pay your employees.

Liquid

Keep the cash on hand for future expenses.

Equipment

Buy new equipment to grow your business.

Staff

Use the loan to hire new employees.

We Fund Fast

24-48 Hours

Loans up to

$10 Million

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5 Stars

Delancey Street Can Help

We're committed to building relationships and helping people all over the USA get access to the RIGHT loan for them. Regardless

Trusted

We're frequently interviewed by major media organizations.

Easy Application

Our app process is super easy. All it takes is one application, and we handle the rest for you.

Service

Service is key. You can ask for advice on ANYTHING and we'll bend over to help.

Experts

Many of our team members are former business owners, and understand your challenges.

Customized

We customize each loan for you, and to your unique specs. Everything is customized.

Universal

We help virtually any industry, any business, anywhere in the USA. It doesn't matter.

Nationwide

We fund business loans nationwide. It doesn't matter where you are, we can help you.

Honesty

This is crucial, and critical. We are 100% honest with our clients, and never strive for less.

Hear from people we’ve helped

“Delancey Street funded our e-commerce shop and really gave us the chance to grow our business significantly.”

- Leena, VP of Sales at Waist Karma

Merchant Cash Advance With Weekly Repayment

Unlike a loan, a merchant cash advance is a cash advance based on credit card sales held in your qualifying business merchant account. Business owners can apply and get approved within 24 hours. If approved, funds are deposited directly into the business checking account.

A merchant cash advance is a means for businesses to raise capital. It allows business owners from a wide range of businesses to raise funds fast through a simple approval process, regardless of bad credit. For business owners that need cash fast, such as for current bills due, it is a great option. It should be noted that there are potential downsides such as high fees compared to other traditional business loans which should be weighed against the benefits.

What is a Merchant Cash Advance?

A merchant cash advance is a form of advanced money against a business owner’s anticipated future earnings. As business owner(s), you receive a lump sum. In turn, you pay a percentage that is referred to as the holdback or retrieval rate and varies based on your business’s credit card sales along with the repayment period. The percentage can range from 5-20%. The length for repayment will depend on the size of the cash advance and the business credit card sales but falls within 90 days to 24 months typically.

To understand the approximate amount you may receive, typically the past two to sixth months are looked at. That average is used and merchant cash advances typically are about 50 to 250% of the monthly credit average for the business.

Benefits of a Merchant Cash Advance

There are a few benefits to obtaining a merchant cash advance if you are a business owner. These include:
• Simple application process that can typically be completed online;
• Fast funding;
• Accessible without high credit score limits;
• No collateral requirements;
• Flexible payments with fixed monthly payments that stay the same each month; and
• High borrowing limits.

Merchant cash advances are a good way for new businesses to obtain capital fast. They are especially good for businesses that have credit card sales but not a long period of time for credit history.

The Specifics of a Merchant Cash Advance

Factor Rates

Merchant cash advances do not have an APR, unlike typical business loans. Instead, they have a factor rate. This rate is the amount that you must repay as the business owner and is represented as a decimal figure, typically ranging from 1.1 to 1.5 to account for the fee of obtaining the cash advance.

This can result in expenses that business owners should understand before seeking out a merchant cash advance. For example, if a business takes out $50,000 and has a factor rate of 1.3 with a twelve-month repayment schedule, then the repayment is $65,000. This equates to a 30% APR. If you agree to a 15% holdback rate then you will be making a $175 daily payment and your overall APR would be 53.9%, after accounting for the daily interest rate of 0.15%. Given the increase from 30%, this is not something business owners should jump into without understanding the potential costs.

Holdback

The holdback is a percentage of the advance, typically fixed, that is used to determine how much you pay back towards the merchant cash advance until it is paid off. This amount usually ranges from ten to twenty percent. It represents the percent of daily credit card sales that the business generates which go towards repaying the merchant cash advance.

What are the Alternatives?

For those that have the benefit of waiting, time will be instrumental for considering alternatives. For example, term loans, which are like a mortgage, and business credit cards are two viable options for business owners that have time on their side. This can potentially avoid the cost of a merchant cash advance for those that can afford to wait.

Decide What is Best for Your Business

To determine if a merchant cash advance is right for you now and the amount and repayment period you feel fits the business, it is a good idea to weigh the benefit of fast access to cash with the realistic generation of credit card sales that the business has. For those that understand the costs involved, it can be a good option to pay bills now and repay them with income sales.