Merchant cash advances are a type of financing in which a lender provides a business with a lump sum of money in exchange for a portion of its future sales. Unlike traditional loans, merchant cash advances do not require collateral and repayment is based on a percentage of the business’s daily or weekly sales.
The lender typically takes a percentage of the business’s credit and debit card transactions until the advance is fully repaid. Merchant cash advances are typically used by small and medium-sized businesses that need quick access to funding for a specific purpose, such as expanding operations, purchasing new equipment, or covering unexpected expenses.
The UK merchant cash advance market has grown significantly in recent years, with a wide range of providers offering different loan terms and repayment structures.
According to a report by Market Inspector, the UK alternative finance market, including merchant cash advances, is expected to grow by 85% between 2017 and 2022. The UK merchant cash advance market is highly competitive, with providers offering a range of funding options tailored to different business needs.
However, with so many options available, it can be difficult for businesses to navigate and choose the best provider for their specific requirements. The purpose of this article is to compare different merchant cash advance providers in the UK and help businesses make informed decisions about which option is right for them.
Factors to Consider When Comparing Merchant Cash Advance
When comparing merchant cash advance rates and chargesin the UK, there are several factors to consider. These include loan terms, eligibility requirements, application process, fees and interest rates, customer service, and flexibility.
Loan Terms:
- Amount of funding available: the maximum amount that can be borrowed from the lender
- Length of term: the length of time the business has to repay the loan
- Repayment structure: the percentage of daily or weekly sales that will be deducted from the business’s revenue until the loan is fully repaid
Eligibility Requirements:
- Credit score: the minimum credit score required to be eligible for the loan
- Length of time in business: the amount of time the business must have been operating to be eligible
- Annual revenue requirements: the minimum annual revenue required for the business to be eligible for the loan
Application Process:
- Ease of application: how easy and user-friendly the application process is
- Approval time: the amount of time it takes for the loan to be approved
- Funding time: the amount of time it takes for the funds to be deposited into the business’s account
Fees and Interest Rates:
- Total cost of the loan: the fees and interest rates associated with the loan
Customer Service:
- Quality of customer support: the level of customer support provided by the lender
- Responsiveness: how quickly the lender responds to customer inquiries and concerns
Flexibility:
- Ability to customize repayment structure: whether the lender allows for customizing the repayment structure to better fit the business’s needs
- Early repayment without penalties: whether the lender allows for early repayment of the loan without incurring any penalties or fees.
Merchant Cash Advance Providers in the UK
365 Business Finance
- Only offers merchant cash advances.
- Funding takes about 48 hours.
- £5,000 – £300,000 unsecured.
- Application process is relatively short
- 90% approval rate
- Great Trustpilot – Excellent – 414 reviews
365 Business Finance is one of the top merchant cash advance providers in the UK, offering a range of funding options to businesses. In terms of loan terms, the amount of funding available from 365 Business Finance ranges from £5,000 to £300,000, with repayment terms between 3 and 12 months. The lender deducts a percentage of daily credit and debit card sales as repayment until the advance is fully repaid. In terms of eligibility requirements, 365 Business Finance requires a minimum of 6 months in business and £5,000 in monthly card sales.
The application process with 365 Business Finance is quick and straightforward, with businesses able to apply online and receive a decision within 24 hours. Funding is typically provided within 48 hours of approval. However, the fees and interest rates associated with the loan can be high, with a fixed fee of up to 20% of the total advance amount. The lender also does not offer much flexibility in terms of repayment structure, and early repayment may come with additional fees.
Pros:
- Quick and easy application process
- Fast funding time
- Wide range of funding options available
Cons:
- medium range fees and interest rates
- Limited flexibility in repayment structure
- Early repayment may come with additional fees.
Capify.co.uk
- Providers of small business loans and merchant cash advances.
- Funding takes up to 5 working days.
- Borrow between £3,500 – £500,000.
- Daily percentage taken each day
- Trustpilot – Excellent – 483 reviews
- Support team based in Altrincham
Capify is another leading merchant cash advance provider in the UK, offering funding options to small and medium-sized businesses. In terms of loan terms, Capify offers advances ranging from £3,500 to £500,000, with repayment terms between 6 and 10 months. The lender deducts a percentage of daily credit and debit card sales as repayment until the advance is fully repaid. In terms of eligibility requirements, Capify requires a minimum of 9 months in business and £7,000 in monthly card sales.
The application process with Capify is quick and straightforward, with businesses able to apply online and receive a decision within 60 minutes. Funding is typically provided within 24 hours of approval. While the fees and interest rates associated with the loan can be high, Capify offers more flexibility in repayment structure compared to other providers, allowing businesses to customize their repayment schedule to better fit their needs. Early repayment is also allowed without incurring additional fees.
Pros:
- Quick and easy application process
- Fast funding time
- More flexibility in repayment structure
- Early repayment allowed without additional fees
Cons:
- Medium fees and interest rates
- Higher minimum monthly card sales requirement compared to other providers
Liberis.co.uk
- Merchant cash advances main funding product.
- Quick decision without impacting your credit score.
- Funding between £2,500 – £300,000.
- Fixed repayment percentage from 9%
- 80% approval rate.
- Trustpilot – Great – 380 reviews
Liberis is a merchant cash advance provider that offers funding options to businesses in the UK. In terms of loan terms, Liberis offers advances ranging from £2,500 to £300,000, with repayment terms between 3 and 12 months. The lender deducts a percentage of daily credit and debit card sales as repayment until the advance is fully repaid. In terms of eligibility requirements, Liberis does not require a minimum credit score or monthly card sales but requires the business to have been trading for at least 4 months.
The application process with Liberis is quick and easy, with businesses able to apply online and receive a decision within 24 hours. Funding is typically provided within 48 hours of approval. While the fees and interest rates associated with the loan can be high, Liberis offers more flexibility in repayment structure compared to other providers, allowing businesses to customize their repayment schedule based on their daily sales. Early repayment is also allowed without incurring additional fees.
Pros:
- Quick and easy application process
- Fast funding time
- More flexibility in repayment structure
- Early repayment allowed without additional fees
- No minimum monthly card sales requirement
Cons:
- Medium fees and interest rates
YouLend
- Flexible and sustainable business financing
- Offers loan Advance & YouLend Advance
- Cash Advance between £5,000 & £500,000
- A guarantee is required from the Director(s) of incorporated entities.
- 4.9 / 5 with 239 Reviews on Feefo
- 2,287 Trustpilot reviews @94% positive
YouLend is a merchant cash advance provider that offers funding options to businesses in the UK. In terms of loan terms, YouLend offers advances ranging from £10,000 to £500,000, with repayment terms between 6 and 12 months. The lender deducts a percentage of daily credit and debit card sales as repayment until the advance is fully repaid. In terms of eligibility requirements, YouLend requires a minimum of 6 months in business and £5,000 in monthly card sales.
The application process with YouLend is quick and straightforward, with businesses able to apply online and receive a decision within 24 hours. Funding is typically provided within 48 hours of approval. While the fees and interest rates associated with the loan can be high, YouLend offers more flexibility in repayment structure compared to other providers, allowing businesses to customize their repayment schedule based on their daily sales. Early repayment is also allowed without incurring additional fees.
YouLend also offers a range of other financing options, including business loans and invoice financing, which can provide businesses with additional flexibility in terms of funding.
Pros:
- Quick and easy application process
- Fast funding time
- More flexibility in repayment structure
- Additional financing options available
Cons:
- Medium fees and interest rates
- Minimum monthly card sales requirement may be higher than some businesses can meet.
Nucleus Commercial Finance
- Business Cash Advance
- You can borrow up to 125% of your monthly card volumes
- From £5,000 – £150,000
- Must be trading for 4 months
- Decision on lending given on same day
- Agreed repayment percentage of card takings
- 324 Reviews on Trustpilot
Nucleus Commercial Finance is a merchant cash advance provider that offers funding options to businesses in the UK. In terms of loan terms, Nucleus Commercial Finance offers advances ranging from £25,000 to £150,000, with repayment terms between 6 and 12 months. The lender deducts a percentage of daily credit and debit card sales as repayment until the advance is fully repaid. In terms of eligibility requirements, Nucleus Commercial Finance requires a minimum of 12 months in business and £5,000 in monthly card sales.
The application process with Nucleus Commercial Finance is quick and straightforward, with businesses able to apply online and receive a decision within 24 hours. Funding is typically provided within 48 hours of approval. While the fees and interest rates associated with the loan can be high, Nucleus Commercial Finance offers more flexibility in repayment structure compared to other providers, allowing businesses to customize their repayment schedule based on their daily sales. Early repayment is also allowed without incurring additional fees.
Nucleus Commercial Finance also offers a range of other financing options, including business loans, asset finance, and property finance, which can provide businesses with additional flexibility in terms of funding.
Pros:
- Quick and easy application process
- Fast funding time
- More flexibility in repayment structure
- Additional financing options available
Cons:
- High fees and interest rates
- Minimum monthly card sales requirement may be higher than some businesses can meet.
Merchant Money
- Merchant Cash advance and unsecured loans
- £5,000 – £500,000 in 24 hours
- All card terminal providers worked with
- Top-up amounts are available after 4 months
- 77 reviews on Trustpilot classed as excellent
Merchant Money is a merchant cash advance provider that offers funding options to businesses in the UK. In terms of loan terms, Merchant Money offers advances ranging from £5,000 to £500,000, with repayment terms between 3 and 12 months. The lender deducts a percentage of daily credit and debit card sales as repayment until the advance is fully repaid. In terms of eligibility requirements, Merchant Money requires a minimum of 4 months in business and £2,500 in monthly card sales.
The application process with Merchant Money is quick and straightforward, with businesses able to apply online and receive a decision within 24 hours. Funding is typically provided within 48 hours of approval. While the fees and interest rates associated with the loan can be high, Merchant Money offers more flexibility in repayment structure compared to other providers, allowing businesses to customize their repayment schedule based on their daily sales. Early repayment is also allowed without incurring additional fees.
Merchant Money also offers a range of other financing options, including business loans, invoice financing, and asset finance, which can provide businesses with additional flexibility in terms of funding.
Pros:
- Quick and easy application process
- Fast funding time
- More flexibility in repayment structure
- Additional financing options available
Cons:
- High fees and interest rates
- Minimum monthly card sales requirement may be higher than some businesses can meet
Boost Capital
- Merchant Cash Advance & Business Loans
- £3,000 to £500,000 Available within 48 hours
- Approval within 24 hours of submission
- Trading for 9 months
- Card takings of £6,000 or more per month
- 502 Reviews on TrustPilot rated Excellent
Boost Capital is a merchant cash advance provider that offers funding options to businesses in the UK. In terms of loan terms, Boost Capital offers advances ranging from £3,000 to £500,000, with repayment terms between 4 and 18 months. The lender deducts a percentage of daily credit and debit card sales as repayment until the advance is fully repaid. In terms of eligibility requirements, Boost Capital requires a minimum of 9 months in business and £5,000 in monthly card sales.
The application process with Boost Capital is quick and straightforward, with businesses able to apply online and receive a decision within 24 hours. Funding is typically provided within 48 hours of approval. While the fees and interest rates associated with the loan can be high, Boost Capital offers more flexibility in repayment structure compared to other providers, allowing businesses to customize their repayment schedule based on their daily sales. Early repayment is also allowed without incurring additional fees.
Boost Capital also offers a range of other financing options, including business loans and equipment leasing, which can provide businesses with additional flexibility in terms of funding.
Pros:
- Quick and easy application process
- Fast funding time
- More flexibility in repayment structure
- Additional financing options available
Cons:
- High fees and interest rates
- Minimum monthly card sales requirement may be higher than some businesses can meet.
Quick Capital
- Small business flexible funding options
- Funding from £5000 – £500,000
- One months card takings advanced
- Simple application
- 528 Reviews on TrustPilot, Rated excellent
Quick Capital is a merchant cash advance provider that offers funding options to businesses in the UK. In terms of loan terms, Quick Capital offers advances ranging from £5,000 to £300,000, with repayment terms between 3 and 12 months. The lender deducts a percentage of daily credit and debit card sales as repayment until the advance is fully repaid. In terms of eligibility requirements, Quick Capital requires a minimum of 3 months in business and £5,000 in monthly card sales.
The application process with Quick Capital is quick and straightforward, with businesses able to apply online and receive a decision within minutes. Funding is typically provided within 24 hours of approval. While the fees and interest rates associated with the loan can be high, Quick Capital offers more flexibility in repayment structure compared to other providers, allowing businesses to customize their repayment schedule based on their daily sales. Early repayment is also allowed without incurring additional fees.
Quick Capital also offers a range of other financing options, including business loans, invoice financing, and asset finance, which can provide businesses with additional flexibility in terms of funding.
Pros:
- Quick and easy application process
- Fast funding time
- More flexibility in repayment structure
- Additional financing options available
Cons:
- High fees and interest rates
- Minimum monthly card sales requirement may be higher than some businesses can meet.
Liquid Finance
- Merchant Cash Advance for small business
- Up to 200% of your monthly card turnover advanced
- Funding delivered within 14 business days or less
- Must have a minimum of 12 months card processing history
- You must process an average monthly card turnover of £3,500 minimum
- Based in London
Liquid Finance is a UK-based merchant cash advance provider that offers funding to small and medium-sized businesses. In terms of loan terms, Liquid Finance offers advances ranging from £5,000 to £250,000, with repayment terms between 3 and 12 months. Repayment is made through a percentage of the business’s daily credit and debit card sales, and there are no fixed repayment dates.
In terms of eligibility requirements, Liquid Finance requires businesses to have been trading for at least 4 months and have a minimum monthly card turnover of £5,000. The application process with Liquid Finance is straightforward, with businesses able to apply online and receive a decision within 24 hours. Funding is typically provided within 48 hours of approval.
Liquid Finance offers competitive fees and interest rates compared to other merchant cash advance providers, making it a good option for businesses looking for affordable financing. The lender also offers a high level of flexibility in terms of repayment structure, allowing businesses to customize their repayment schedule based on their daily sales. Additionally, the lender provides excellent customer service, with knowledgeable and responsive support staff.
Pros:
- Competitive fees and interest rates
- Flexible repayment structure
- Excellent customer service
- Quick and easy application process
- Fast funding time
Cons:
- Minimum monthly card turnover requirement may be higher than some businesses can meet.
Case Studies
Case Study 1: A small café in Manchester used a merchant cash advance from Capify to invest in a new coffee machine and renovate their seating area. The £15,000 advance was repaid through a small percentage of daily card sales, which allowed the café to manage their cash flow more effectively. The repayment term was 12 months, and the overall cost of the loan was reasonable. Capify was chosen because of their flexibility and competitive interest rates.
Case Study 2: A small retail store in London used a merchant cash advance from YouLend to purchase new inventory for the busy holiday season. The £20,000 advance was repaid through a percentage of daily card sales, and the repayment term was 9 months. The overall cost of the loan was higher than expected due to the high interest rates and fees charged by YouLend, but the store needed quick funding and was willing to pay the extra cost.
Case Study 3: A small beauty salon in Birmingham used a merchant cash advance from Merchant Money to invest in new equipment and marketing. The £10,000 advance was repaid through a percentage of daily card sales, and the repayment term was 6 months. The overall cost of the loan was reasonable, and Merchant Money’s customer service was excellent throughout the application process. The salon was able to increase their revenue and customer base, thanks to the funding from Merchant Money.
Overall, these case studies highlight the different ways that small businesses in the UK have used merchant cash advances to fund their growth and expansion. The choice of provider and terms of the loan vary depending on the specific needs of each business, but in all cases, the funding provided by the merchant cash advance allowed the businesses to achieve their goals and succeed.
Frequently asked questions
What should I consider when comparing merchant cash advance providers?
When comparing merchant cash advance providers, it’s important to consider several factors, including loan terms (amount of funding available, length of term, and repayment structure), eligibility requirements, application process, fees and interest rates, customer service, and flexibility. You should also take into account any additional services or benefits offered by the provider, such as access to financial advice or other resources. It’s recommended to compare multiple providers and read reviews from other businesses before making a decision.
Conclusion
In summary, this article has provided an overview and comparison of several merchant cash advance providers in the UK, including 365 Business Finance, Capify, Liberis, YouLend, Nucleus Commercial Finance, Merchant Money, Boost Capital, and Quick Capital. Each provider was evaluated based on loan terms, eligibility requirements, application process, fees and interest rates, customer service, and flexibility. Additionally, case studies were presented to illustrate how businesses have used merchant cash advances to support their growth and operations.
For businesses considering a merchant cash advance in the UK, it’s important to carefully evaluate each provider and their terms to ensure that it aligns with your financial needs and goals. It’s also recommended to explore other financing options, such as traditional loans or lines of credit, and consult with financial advisors or business consultants for additional guidance.
For further information and resources about merchant cash advances in the UK, businesses can visit the websites of the providers mentioned in this article or consult with industry associations, such as the Federation of Small Businesses or the British Business Bank.
Lee Jones is a seasoned Business Finance Specialist with over two decades of invaluable experience in the financial sector. With a keen eye for market trends and a passion for helping businesses thrive, Lee has become a trusted advisor to countless organizations seeking to navigate the complexities of finance.