Charles Baratta, The Merchant Service Group Blog

This is Charles Baratta with express funding group.  Here I’m talking about the advantages of business cash advance compared to small business loans. Now, this video’s going to be based on the leniency on personal credit scores of the small business owners when it comes to business cash advanced lending as opposed to small business loan lending. Now, a business cash advance lender will allow for his small business owner to have personal credit as low as 500 FICO, and when you compare that to a traditional bank that originates traditional small business loans, you’ll look at a FICO score of north of 720 FICO. So business cash advance lenders are much more lenient.  They understand that small business owners do leverage most of their credit cards and home equity lines of credit in order to grow their business and expand. So again business cash advance lenders are much,  much more lenient and look at the business with much broader of a view than a traditional bank originating traditional small business loans. I hope this has been helpful.  For more information go to MerchantLoans.com or call me directly at 516-730-2442.

Charles Baratta here again with Express Funding Group going over the advantages of business cash advance financing versus small business loan financing. Now in this video I’m going to talk about how business cash advance lenders do not report to the three major credit bureaus once the advance has been originated. Now you compare that to the traditional small business loan lenders who do report that to the credit agencies. This is a big plus for small business owners. Now the reason it’s a big plus is because small business owners also own homes, they want to buy boats, they buy cars and when applying to other creditors, this advance is invisible. So if a small business owner wants to refinance his or her own house, this line will not show or they want to purchase a boat or a car and they need a loan it will not show up as any kind of financing. So, although business cash advance companies do file a UCC against the business, this does not show up on the small business owner’s personal credit. I hope this video has been helpful, I will see you on video number six coming up shortly.  For one on one advice, give me a call at 516-730-2442, or text your name, email and website to 516-513-8439 to get  on our preferred client list and receive a free month of local, direct advertising for your business.

Accepting credit card payments from customers as part of your daily business practice may seem like an intimidating prospect but it’s really not that difficult. However, before you decide to take the leap away from operating a cash-only business, there are some things you need to know when choosing a merchant services provider.

The first thing you should know is that the first vendor you approach probably does not have the perfect package to meet your needs. You really have to shop and when you shop, do so on the basis of what is the best account for your needs rather than who is the best provider. If you manage to combine both it will be icing on the cake.

If the bottom line is the most important factor in choosing a merchant account, you will need to know there are four common pricing structures in the merchant account industry. These include flat rate, interchange-plus, tiered and enhanced recover reduced (ERR). The flat rate and interchange-plus rates are usually better because they are less expensive and easier to compare than tiered and ERR. However, almost all interchange-plus accounts require a contract and cancellation fee. For now all you need to know is that the flat rate and interchange-plus fee structures are most commonly used by small business.

To determine what account pricing structure best suits your needs there are some factors to consider. As MerchantCouncil.org states, “No single account will have the lowest merchant account rates and fees across the board – and it doesn’t have to, it just needs to have great rates where it matters to you. Dealing with providers is a game of give-and-take. They’re in business to make a profit, and so are you. When you ask a provider to lower one fee, you should be prepared for them to raise another.”

Among the fees you will have to contend with include monthly processing volume, average ticket, monthly minimum and statement fees. If your business does significant volume, you will have more leverage to ask for a lower rate on your volume. If your business tends to have a high average ticket but lower volume, it is in your best interest to demand a lower discount rate. If your business is almost entirely seasonal, avoid accounts that charge monthly fees.

Other features to consider before choosing a merchant account are the cost of equipment, software or maintenance fees. Some providers will throw in the credit card terminal reader at no cost for signing on to their services. Watch out for long term contracts and proprietary equipment. If customer service is important, check with your potential provider as to their quality of service ratings. Finally, having a merchant account that is local may be a huge plus when there is a need to deal face-to-face with someone who knows your name and your business needs.

Now that you have a good sense what to expect as far as cost and features, the hard part may be finding the right provider. An immediate internet search of merchant account providers draws literally thousands of hits. For the beginner, this could be overwhelming to the point that settling on the first provider may be the easiest choice. Don’t. Instead, here are some tips to avoid being corralled into the first provider that comes along. Ask other business associates. Try networking and comparing notes with others. Your bank may also be a good starting point as well. Another option would be to try an online quoting service that can compare rates based on your business profile.

Once you’ve narrowed down your selection to several vendors, compare rates between your selections. Feel free to share your options with each of the vendors and let some competition take place between them. Once you’re ready to settle on a final choice, read the fine print carefully and make sure you understand all the details when it comes to cost and features. The next thing you’ll need to do is submit your application. This will take a little time as underwriters assess risk. Much of this will be based on whether your customers are present when they submit their credit card information or whether they are absent. Once approved, make sure you stay up to date on the account. Maintaining the account is important to control costs.

Let Merchant Service Group help you expand your business by accepting credit cards and other electronic payments. Visit us at BusinessCreditCardProcessing.com.

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