According to recent research, entrepreneurs considering their financing options tend to turn to banks for a small business loan first, but at least one in 10 seek other means of capital, including peer-to-peer and cash advance loans, The Wall Street Journal reports. Retailers and restaurant owners are particularly attracted to non-bank offerings due to the high volume of debit and credit card sales they process on a daily basis. Companies enjoy the lack of a set period for repayment of an advance, which allows remittances to fluctuate based on sales – unlike with a bank loan. Ken Wisnefski – owner of VendorSeek, which connects companies with business services – told the news source that a $200,000 merchant cash advance saved his company at the height of the recession, when banks were not receptive to doing business with him. “Within 14 days we got the working capital we needed,” he told the newspaper. “It’s still incredibly difficult to get credit, and this option is out there.” Cash advances allow out-of-work citizens to start their own businesses, which explains why states with high unemployment rates – such as California and Nevada – have strong startup activity
Posted on: Thu, 25 Jul 2013 15:25:07 +0000
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