The Merchant Cash Advance Versus Invoice Factoring

A potential client of ours recently said he was trying to decide between using a merchant cash advance loan or invoice financing to fund his business.

Both funding sources have benefits, but there are some key differences to keep in mind if you find yourself facing a similar decision.

First of all, the cash advance is essentially a short term loan. Some companies classify it as a “sale of future credit card sales,” which shields them from interest rate limits, which can range from 10 to 100 percent.  The bottom line, though, is it creates a debt that must be repaid, typically through a percentage of future credit card sales.

The benefits are immediate cash and an easy application process.

Invoice factoring is not a loan and creates no new debt. There is no money to pay back, ever. After an easy application process, funds are deposited immediately based on the value of your accounts receivable. Perhaps best of all, the financing line increases as your sales grow.

When Universal Funding is your provider of invoice factoring, rates can start as low as 1 percent. And with the added benefits of working with Universal, you have access to free business advice, tax help, credit checks on new customers and the option to obtain A/R insurance.

Choosing the right form of business financing is a huge part of any company’s success. If you’d like to discuss how invoice factoring can benefit you, as the gentleman mentioned in the opening paragraph did, please contact us today!

He’s the latest to benefit from our funding services, maybe you can be next!


Press Releases

Financially Fit Businesses in 60 Days or Less

Spokane, WA (May 16, 2016) – Companies get financially fit by using the services of an invoice factoring company. Universal Funding Corporation provided working capital funding for five new clients in April. Over the course of the next year, these new clients... read more

Growing Companies Get Financing from Factoring Company

Universal Funding Corporation releases early numbers for new clients served in the first quarter of 2016. Highlights include: $12 million factoring facility for a distributor in New Jersey $2.4 million factoring facility for a car service in Arizona $1.2 million... read more


Let Your Factoring Company Analyze Risk

In order to remain competitive in your industry, you’ve probably considered extending credit terms to your customers. Maybe you already offer payment terms to customers in good standing. When your customers pay on time, all is good, but what happens if they don’t pay... read more

Financing that Grows With Your Business

This success story comes from a green minded company that specializes in e-waste recycling where they clear data on electronic devices for other businesses. The client started using Universal Funding’s invoice factoring services in 2015. Their initial factoring line... read more

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Spokane, WA 99213


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