With so many options for small business loan funding – and even more blogs and commentators analyzing those options – out there, some information about the way small business lending works is bound to be muddled in the grand scheme of things. Some of this information will inevitably filter down to small business owners looking for solutions to their cash flow dilemmas, and it often convinces businesses that they might not be eligible even when, chances are, they could find funding through a merchant advance or small business loan product. Here are the top three pieces of misinformation about the small business loan marketplace that we’ve encountered – and how they should be corrected!
They Don’t Work for New Businesses
This one is particularly tricky. Many business owners wonder whether their small business – be it a year old, three, or five – is simply not established enough to obtain funding or a business loan. Merchant Advance looks at businesses with as little as a year of experience in their market: we need to be able to see a credit history, but our assessment of the business goes beyond the calendrical proof of its financials. Which brings us to the second myth:
My Credit Score Is All That Matters to You
While your business’ credit score does factor importantly into the assessment of eligibility for a small business loan or merchant advance, it’s not all about algorithms. Financial technology has increased the efficiency and speed of approvals through automated processes, but the human element still has a deciding hand: even if your business has felt pressure on its credit score, you can still apply on the strength of your solid business planning, well-thought-out use of funds, and positive feedback from key associates like your suppliers and social media channels. And speaking of speed:
- Applying for a Small Business Loan Takes Too Long
Online applications processes have evolved to the point where getting approval for a merchant advance or small business loan can take as little as a week or even less. Our underwriters and admin staff are always getting better at identifying the key information that will allow us to get your application processed and start funding flowing to your accounts. As long as you help us out by sending a little bit of your business information in a timely manner, your funding can and will be on its way in time to cover shifts in your business cycle or unexpected emergencies.
With these myths busted, your small business can feel even more secure and confident that your funding needs can be addressed quickly and without disruption to your cash flow by either a merchant advance or small business loan.