As small businesses grow, they often need capital to fund activities ranging from updating their website design to opening a new location. But, often times the loan application process can be lengthy and cumbersome. We want to help you simplify the loan process.
Square, the mobile payment processor, is offering a new loan program for small businesses that may be a nice alternative to traditional loans.The program is called Square Capital. It allows existing Square customers to get a cash advance quickly and easily. The funds, plus a fixed fee, are then paid back over time through a percentage of daily credit card sales. So, for example, if a company receives a $20,000 advance they would be required to pay back the $20,000 plus the fee . But, the re-payments would be taken as 5% of credit card sales for as long as necessary to pay back the full amount of the loan plus the fee. There are no payment terms so it doesn’t matter how long it takes to pay back the funds. Many small business owners see cash flow as their number one concern, so paying back the funds as a percentage of sales works well for them. Cash advance programs like Square Capital could be a good alternative for companies who don’t want to go through the red tape and delays associated with applying for a traditional loan.