The income from my business is very seasonal and I need some money now at a quiet time of year to buy stock at lower prices. How can I do this?
With the banks being reluctant to lend as much as they should, new entrants to the finance market have arrived.
KSA Group introduces an alternative way to raise money for SMEs. It is not a loan but an advance on future credit card payments made to the firm. The backer of the scheme is Dollar Financial Corp of America. In the US, this type of finance is a multi billion industry. The scheme is partnered with Lloyds TSB Merchant Services and MCE Limited, trading as Business Cash Advance (BCA).
Any Business that accepts Credit and Debit Cards can raise money in this way.
The money advanced is not a loan so no interest charge applies. The advance is the purchase of your future debit and credit card receipts by BCA with an agreed fee being added to the debt from the setup of the arrangement.
How The Funding Program Works:
The repayment amount and the percentage of daily credit/debit card takings directed to MCE are fixed for the life of the contract. There is NO fixed term, NO repayment dates, and NO penalties for late or slow payment. The fixed percentage taken by MCE means repayment mirrors the merchant's cash flow. MCE gets paid when the merchant gets paid and of course you keep 100% of all other receipts, MCE only takes a % of the debit/credit card receipts.
- No application fees or hidden charges, and a simple application process.
- Money on the merchant's account 10 working days after application.
- No security or guarantees required.
- No audited accounts or tax returns required.
- No fixed payments MCE gets paid when the merchant gets paid.
What A Merchant Needs To Get Started:
- Submit 12 months card processor statements (18 months for advances over £20,000)
- 3 Trade References.
- Landlord Information and 1 year remaining on their lease.
- An average of at least £3,500 per month in credit/debit card sales.
So if your business needs money and you are finding the bank less than co-operative, or maybe you just need an alternative to the bank for some short term finance let's sum up with a few Frequently Asked Questions:
How much can I raise ?
You can receive a lump sum up to a maximum of 1/12th of your last year's credit and debit card sales.
Are there restrictions as to what I can use the money for?
You can use the money for any purpose.
How do I repay the advance?
The money will be collected by taking an agreed percentage from your future card sales. There is no fixed payment term you repay when you get paid.
How much does it cost ?
A charge is added to the sum advanced which gives you a fixed amount to repay irrespective of the period. There are no other costs or fees. The charge depends on your particular circumstances and we can quickly provide a quotation.
Do I need to provide a business plan?
You do not need to provide business plans or sales forecasts and there is no tangible security required.
How do I need to apply?
- You do need to have been in business for at least 12 months
- To have credit and debit card sales of at least £3500 per month.
- Be able to provide 3 trade references plus landlord or mortgage provider
How quickly will I receive the funds ?
The average time from application to funds being transferred to your bank account is 10 working days
Can I re-apply for further advances ?
Yes, when you have nearly repaid you can re-draw as many times as you wish
If you think this may be of interest to you please call us on 08009700539.
Worried about poor cashflow? Covid-19?, How to pay wages on pay day? For expert advice on a range of issues download our free Ultimate Guide For Worried Directors today. Or just call us on 0800 9700539
Please note that the guide was mostly written pre Covid-19 and there have been some changes to insolvency legislation that limits creditors actions and relaxes rules regarding wrongful trading. A new 20 day moratorium for distressed businesses has also been introduced.