OnDeck is a preferred option to merchant cash advances – we offer lower rates, fixed payments and true business loans where your payments are reported to the business credit bureaus. And with OnDeck, you can apply in just minutes and have funding in as fast as one business day.
If you’re seeking merchant cash advances for financing specific purchases such as equipment, inventory, expansion or marketing, consider instead a 3-24 month loan from OnDeck. Requirements include: 1 year in business and $100, 000 in annual revenue.
What is a Merchant Cash Advance, and how is OnDeck Different?
With a merchant cash advance (sometimes known as a business cash advance), a business owner gets an advance on their future credit card sales. This advance is paid off by the advance company taking a percentage of each credit card transaction until the agreed upon amount has been paid back to the advance company.
For example – Joe’s Pizza gets an advance of $10, 000, and they agree to pay back $14, 000 (note: OnDeck offers rates are far lower than this). The advance company then takes a percentage (typically 10%-20%) of every credit card transaction until the business has paid back the agreed upon $14, 000. It is important to note the difference between the “hold back” (10%-20% in this case) and the “payback” or “interest rate” (40% in this case.)
Three Reasons Why OnDeck is Different
1) OnDeck rates are typically up to 50% lower than a merchant cash advance.
2) Unlike a business credit card advance, OnDeck offers both a fixed rate and a fixed term. This means that a business owner knows the exact amount they will pay back, and the exact date the loan will be fully paid off.
3) With an OnDeck loan, repayment is reported to the business credit bureaus.
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