Cash Advances

By:    Updated: December 14,2016

Have you ever been in a professional or personal position when you need cash that you simply do not have? A credit card may not meet your needs, especially if you need instant access to funds for rent, employee wages, or independent contractor payments. It's not uncommon for credit card companies to deny your personal and business applications for additional lines of credit.


In today's volatile economic climate, you may find that you or your business falls short for some reason or another. What do you do when you don't have cash, and shutting down is not an option? Especially if you have a family, you can't slash your living expenses. If you have a business, you can't just close down or cut your employees. You need to stay positive, look to the future, and keep your livelihood going strong to overcome your personal or professional setback.


Before you feel stressed, consider a personal, merchant, or small business cash advance where a company will give you funds immediately, when you need it. Businesses and consumers can use this type of loan to keep operating and making ends meet.


Cash advances are also called payday loan, paycheck advances, and payday advances.

Cash Advance Companies

A variety of companies are available to provide cash advance solutions to different types of customers. Personal cash advance companies tend to be more accessible and quick, but these plans disburse funds in smaller amounts: $100 ~ $1,000.


Business and merchant cash advances are typically larger in the thousands of dollars range. As a result, cash advance companies tend to conduct more extensive background checks on businesses than with consumers.


Typically, personal cash advances come are available with a shorter repayment plan than business and merchant cash advances. Individuals will need to pay back loans before their next paycheck or within one month, while businesses may have several months and even a year. Some businesses are on more extensive payment and profit sharing plans with cash advance creditors. Both businesses and consumers should have an understanding of the benefits and costs of a cash advance loan.

Personal Cash Advances & Fees

A personal cash advance is a service provided by most credit card and charge card issuers. The service allows cardholders to withdraw cash, either through an ATM or over the counter at a bank or other financial agency, up to a certain limit. For a credit card, this will be the credit limit (or some percentage of it).


Typically, companies will charge a flat fee or impose an interest rate on borrowed funds. Other companies will charge interest rates based on the borrowed amount. These interest rates tend to be higher than credit card rates. Many credit card companies will allow you to borrow money using your own line of credit at a higher interest rate.


Personal Cash Advances also can borrom cash from p2p companies since 2014. There are many companies provide this service, such as LendingClub Corporation(NYSE:LC), Yirendai Ltd.(NYSE:YRD), and so on.

Business & Merchant Cash Advances

In today's economy, it's common for businesses to have slow months. Making payments is tough, especially when the credit environment is tight and when banks are hesitant to give loans, especially to businesses with low collateral and bad credit.


Unlike loans and credit card companies, merchant and business cash advance companies are not subject to the laws that limit interest rates. When you repay a loan, you make regular payments over a fixed amount of time.


On the other hand, cash advance companies will negotiate repayment in terms of a business agreement that allows lenders to take a percentage of the borrower's revenues until the principal amount and premium are paid in full. The equivalent APR for a business or merchant cash advance can range from about 50 percent to 250 percent.

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