%name Alan Turing merchant cash advance

Will the merchant cash advance make cash obsolete?

Will the merchant cash advance make cash obsolete?

Do you remember the time when a £50 note was so rare that you actually stared in wonder at one? We do at PDQ Funding and truth be told, they’re still fairly rare now. The note, however, made headlines recently as Alan Turing is to be featured on the new one. His story is a sad one for such a genius but we don’t intend focusing on that issue from that time. Instead, we will look at why cash is disappearing.
First, though, slight rewind.

Choices of payment in Europe

Two of the PDQ Funding team recently had weekends abroad in Sweden and Belgium, two countries miles apart but with several things in common. First, there appeared to be an abject shortage of 24 hours ATMs in Stockholm and Brugge. There seemed to be little demand for cash advances for personal use, as card terminal payments were de rigeur.
Even, for example, where you’d expect to find cash only: parking meters and smaller convenience stores, a card machine with contactless payment was common. Small businesses seemed to have adopted a card transactions only model. Perhaps this is inevitable given the rise of payments by phone or wearable technology, or contactless cards, but for these two residents of Britain, the card terminal culture came as a bit of a surprise.

Small businesses embrace cashless

There is, though, a clear logic in going cashless. Accountancy over the average month is made easier. There’s no cashing up, like businesses did 30 years ago, with trips to the local bank. Cash, for example, is still widely accepted but the modern business owner knows that the small percentage of customers who use cash only are declining. The culture of business finance has changed.  The registered office of a franchised business wants to see card transactions, profits and losses, online.

Is cash generational?

If you go back 30 years and more, it was perfectly normally for workers to be paid in cash, with notes and coins. Workers didn’t rush to deposit it in a bank account – they used it for living expenses, like, for example, leisure and shopping.  If more money was needed for a car purchase, for instance, traditional bank loans were sought.  If a business needed more money, they’d make an appointment at a physical bank and talk and apply for a business loan, whether that was secured or unsecured.

The rise of business cash advances

Business cash advances, or merchant cash advances, are a relatively new phenomenon. They offer easy fixed terms in relation to payments with a stable interest rate. They are now seen as one of the best funding options for short term unsecured business success.

How is a merchant cash advance helpful to business owners?

There are, of course, pros and cons to going cashless: lower flexibility, higher risk of cybercrime and the risk of alienating certain customers. But there are clear advantages too: your repayments are levied against an average month’s takings on your card terminal, easing cash flow situations.

How do I apply for a business cash advance?

To qualify for a PDQ Cash Advance, you generally should have been trading for 6 months. Ideally the business needs to take £5,000 or over in credit and debit card payments.  If your business done not meet that criteria, don’t worry as PDQ Funding may still have funding options available to you.

With a PDQ Cash Advance, the lender works with the card payment terminal provider so they have an understanding of how much cash is being processed through your business. That means that unlike other types of borrowing, there’s no need for credit checks.

How do you assess?

Every PDQ Cash Advance application is considered individually and the amount charged is dependent on business performance. A company with a good performance history could negotiate a lower upfront fee. This is down to they pose a small credit risk to any merchant cash advance lender.

Repayments are automatic and calculated as a pre-agreed percentage of a company’s future credit card & debit card takings.  You only have to pay back the cash advance and fee when the sales come in.

Cash Advances between £5,000.00 and £200,000 are generally available and you could be approved within 48 hours. You keep all of your non-card income, meaning you don’t have to make any payments on top of the agreed card payments

Most businesses need a little extra help at times. The important thing is to know whether additional finance is needed because the business is expanding and requires more resources.

What industries do you provide cash advances with?

We cover all industries as you can see from our examples here for a multitude of uses. Typically, businesses use PDQ Funding to enable relocation, expansion, a marketing drive, recruitment or to widen products or service provision. You can read merchant cash advance success stories on this blog page.

How do I apply?

Use your future credit and debit card sales to raise an unsecured business loan today. You will receive the lump sum directly in your bank account to use on any business funding need. You repay only a small proportion and repayments are automatic and hassle free.

 

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