Merchants are frequently in need of cash when they have already exhausted all other sources of available credit such as bank loans, lines of credit and credit cards.
Banks often refuse to lend money to merchants in this situation because there is no obvious way to secure the loan, and lending money to a merchant who is already in debt to other banks is inconsistent with normal underwriting guidelines.
The creative entrepreneurs of the merchant cash advance market, including Synergy Merchant Services, offer a product called merchant cash advance that allows a merchant to pay back a cash advance by directing its processor to split credit card receivables between the merchant and the company that gave the cash advance. Hence, ensuring a timely payback of the principal and continued working capital for merchants.
A cash advance is typically more expensive for a merchant than a loan. But for many merchants, it is their only or most logical choice. The cash advance industry is very active in the United States and has slowly emerged in Canada, putting Synergy Merchant Services; a Canadian owned company on the front lines and at your service.