A cash advance: alternative finance for independent businesses

A cash advance: alternative finance for independent businesses

It’s estimated that over 500,000 new start-up small businesses are created each year in the UK. With this number slowly increasing and traditional bank lending becoming more difficult to secure, a large number are losing out on growth and investment opportunities.

A survey recently carried out by Amicus Finance found that almost a third of small business owners  have lost out on an opportunity because their bank was unwilling to service their borrowing requirements. Whilst a 2014 government study found that two of the biggest hurdles facing these businesses are the lack of access to finance and day to day cash-flow issues.

With 42% of small businesses considering alternative finance, we look at why business cash advances are gaining popularity in the UK and what really matters to them when sourcing funds.

Flexibility

Research has found nearly half of small business owners consider flexibility to be one of the main factors when choosing a finance provider. Unlike small business loans, business cash advance providers such as Quick Capital do not ask to see business plans, accounts, forecasts or require security (all they need to see is your recent card processing statements). Repayments are flexible, a pre-agreed percentage of your daily credit and debit card takings are deducted automatically (there are no fixed monthly costs), meaning you only pack back the advance when you earn.

This makes it ideal for those businesses requiring short term funds for refurbishments, additional stock, seasonal periods or unexpected expenses.

Speed

One of the biggest benefits of a business cash advance is the speed in which the application is processed. It usually takes a matter of minutes to find out how much you can raise, how much you’ll pay back and at what percentage.

Since a business cash advance is unsecured finance, there’s a lot less paperwork to go through and the money can be in your account within three working days (providing the necessary checks are passed). Traditional banks can take weeks or even months to process an application and deposit funds into a business account.

If your business has encountered an unexpected hurdle or seasonal trend, this kind of immediate risk-free cash injection could be the difference between survival and closure.

Customer Service

Studies reveal that when it comes to servicing the needs of small businesses, alternative lenders are outscoring the banks when it comes to the quality of customer service.

Cash advances have been specifically designed to suit the needs of small businesses and a key benefit is their “no hassle” customer service. Dedicated customer service teams will be on hand to answer questions and offer general advice on your funding options to make sure your business keeps thriving.

Today, independent businesses have more variety than ever when it comes to sourcing finance. Before applying, it’s important to ask; what do you need the money for? How much do you need? How long will it take to pay it back? How quickly do you need the money? This will help to determine whether a cash advance will take you in the right direction to achieve growth and success.