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How Having Bad Credit Can Impact Your Business

Bad credit. For business owners all across Canada, it’s as good as a disease. If you’ve ever had an issue with borrowing money – or to be more specific, paying back the money you’ve borrowed – your credit score isn’t likely to be in the best of shape. It’s something that many people may not even think about too often – but, for a business owner, it’s a vital part of his/her everyday work.

How does bad credit affect a business?

Having bad credit makes it really hard to secure a loan from a bank. “A poor credit score won’t help your cause when it comes to obtaining a small business loan, especially in today’s economy,” warns Brian Hughes on, “If your credit score is holding you back from obtaining startup capital, you may need to consider alternative business funding options or using collateral to secure a small business loan.”

“Whatever the cause, poor business credit can have a devastating impact on a company’s financials,” agrees Don Sadler on, “This is especially true of manufacturing companies, which often must pay for raw materials and other goods and services weeks (or even months) before they can collect payment from their customers. Without access to trade terms or short-term bank financing, such as a revolving line of credit, they can easily run out of cash and go out of business.”

How can a business secure financing with a bad credit rating?

As Hughes points out, alternative business funding options are necessary. This is because banks are more concerned with having their loans paid back than they are with the financial requirements of their borrowers. At Synergy Merchants, our unique merchant cash advance program takes into account all of the ups and downs of the businesses it funds.

What that means is that – firstly – credit doesn’t come into play! We approve merchants for merchant cash advances based on their credit card and debit card sales. Based on their monthly sales averages, we offer merchant cash advances which are equivalent to payments for future credit card and debit card transactions. Because we are paying for a portion of a merchant’s future sales, the money we provide is not a loan – again, it’s a payment!

Since our clients aren’t borrowing any money, researching their credit histories isn’t part of the application process. As well, the ways in which our merchant cash advances are paid back also highlight the fact that one’s credit history is insignificant. There is no repayment schedule. As a result, there is no such thing as being late. With the absence of “late payments”, a merchant runs no further risk of worsening his/her credit rating.

How are merchant cash advances paid back?

We take a small percentage of a merchant’s future credit card and debit card sales. In other words, every time a sale is made in a client’s store, a small portion of the sale is put towards his/her repayment. When sales are slow, so are payments. When sales pick up, so do the payments. As mentioned, we work with the unique ups and downs of each and every one of our clients.

If you have bad credit, but you’re looking for a way to secure extra working capital in order to grow your business, look no further than Synergy Merchant’s merchant cash advance program. For more information or to speak with one of our licensed funding specialists to get a free, no obligation quote, simply call Synergy Merchants at 1-877-718-2026 or email us at

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