What is a merchant cash advance?

A merchant cash advance, or MCA, is an alternative funding source that works best for a business that needs quick access to money, often to fill-in temporary revenue gaps.

A merchant cash advance is different from a bank loan in several ways:

• Structure - With a merchant cash advance you receive an “advance” of your business’s future revenues in exchange for granting the right to a portion of future revenue to Horizon Business Funding.
• Timing - A merchant cash advance can be secured in as little as 24 hours whereas a traditional bank loan may take 30 to 60 days.
• Term - A merchant cash advance is designed to be a short- term financing vehicle. Traditional business loans are generally designed for long-term capital needs.
• Credit Score - The structure of a merchant cash advance relies much more heavily on a business’s monthly deposit volume than a specific credit score.
• Business History - Most banks will not lend to a business with less than 5 years of business history. At Horizon, we only require 1 year of business history to provide financing.

By signing an agreement with an MCA provider, your business receives a lump sum payment that is paid for through a portion of future credit and debit sales.While you generally don’t have to worry about your credit score to be approved for an MCA, underwriters do take revenue and other debt into account.

When applying, you'll need to be US business with a business bank account, in operation for at least 1 year, copies of your last 3-6 months of bank statements, and potentially tax documents, landlord contact information, and other reference material.

Underwriters then analyze the provided records and may call you to request additional information.

When your business is approved for MCA financing, you will receive the particulars regarding your company’s qualification terms. This may include the associated factor rate, the payment period options, and the maximum advance amount. Once you agree to the terms and sign the contract, the funds are deposited into your business bank account.

To pay the MCA for your funds, you authorize your bank to daily debit the estimated amount agreed upon that is the percentage of your future revenues you sold.

Included in your contract are the factor rate terms, which determines how much the cash advance will cost your business. Usually, the factor rate ranges from 1.1 to 1.5. The advance amount is multiplied by the factor rate to determine how much you will pay for the funds.

The holdback is tied to the rise and fall of the business’s revenue. Therefore, if you have no sales on a particular day, you have a right to ask for a true up adjusting the payments downwards. When business picks up, you pay more. There are no savings for paying early.

For example, if you received a lump sum amount of $50,000, that money minus any fees is deposited into your account and your business is on the hook for that entire amount plus the factor rate.

How to apply for a merchant cash advance with Horizon

To learn more about how a merchant cash advance works or to see if it's a good fit for your business, please use our contact form below or give us a call at 1 866-454-1615 and a funding advisor will be happy to help.

What is the Employee Retention Credit (ERC)?

The Employee Retention Credit (ERC)  is a tax credit available for small business owners, LLC’s, S-Corps or 1099 employees. Similar to the $1,200 stimulus check taxpayers received, this credit is designed to help small businesses during these trying times.

It's a fully refundable tax credit for employers equal to 50 percent of qualified wages (including allocable qualified health plan expenses) that Eligible Employers pay their employees. This Employee Retention Credit applies to qualified wages paid after March 12, 2020, and before January 1, 2021. The maximum amount of qualified wages taken into account with respect to each employee for all calendar quarters is $10,000, so that the maximum credit for an Eligible Employer for qualified wages paid to any employee is $5,000.

Eligible Employers for the purposes of the Employee Retention Credit are employers that carry on a trade or business during calendar year 2020, including tax-exempt organizations, that either:

• Fully or partially suspend operation during any calendar quarter in 2020 due to orders from an appropriate governmental authority limiting commerce, travel, or group meetings (for commercial, social, religious, or other purposes) due to COVID-1
• Experience a significant decline in gross receipts during the calendar quarter. (For more information from the SBA directly, see Determining Which Employers are Eligible to Claim the Employee Retention Credit .)

Apply for the Employee Retention Credit (ERC) with Horizon Business Funding

To learn more about applying for the ERC with Horizon, please visit our ERC Frequently Asked Questions page or check out What Documents Are Needed for the application.

Ready to start? Apply here

To offer a one of a kind business card, Hozon has partnered with Revenued – a card built for all businesses, including those with subprime credit.

Their small business scoring looks beyond your personal credit score and can offer you much more than your current personal credit card or business card.

The Revenued Business Card makes business financing possible for virtually any U.S. company that:

• Can sustain a $1,000 average minimum balance in its connected bank account, with no more than three negative days per month.
• Has operated for at least six months.
• Has $10,000 in monthly sales.

Learn more about the Revenued Card and apply here today .

If you have big purchases on the horizon, set yourself up for success with the Revenued Flex Line. Unlike a merchant cash advance or business loan, you'll only pay for what you use.

There comes times when a business card won't work and you need cash – payroll is tomorrow, you need to pay a supplier upfront, and more. For that, you're able to make a cash draw through your Revenued online portal.

With the portal, you'll receive access to your account 24 hours a day. Here you can review your daily balance, check your daily payment schedule, request a spending limit increase, and more.

To learn more about the Revenued Flex Line and see if it's the right solution for your business, simply fill out the contact form below or call us at 1 866-454-1615 .

Small Business Administration (SBA) loans are government-backed loans available to businesses through lenders.

During 2020 and 2021, Horizon Business Funding helped provide over $4B in funding to 110k + businesses as a part of the Paycheck Protection Program (PPP).

Aside from the PPP Loan, there are also different SBA Loan Programs available to businesses such as:

• The 7(a) Loan Program – This is the main SBA program for providing assistance to small businesses. Terms and conditions will vary by loan, and loan amounts range from $350k to $5 million.
• >The Microloan Program – This program provides the smallest loan amounts available from the SBA, ranging from $10k to $50k. This program is ideal for small startups, borrowers that have limited collateral or businesses that need a small financial boost.
• >The CDC/504 Loan Program – The CDC/504 program offers loans to small businesses with long-term fixed-rate financing. The loan is used for expansion or modernization (like large equipment or real estate purchases). These are usually larger loans capped at $5 M. Terms can be 10, 20 or 25 years, depending on the purpose of the loan.

Still, looking for the right financing option for your business? Fill out the contact form below or call us at 1 866-454-1615 and a funding advisor will be happy to find the right solution for you. We're here to help!

Business Term Loans are a lump sum of capital that gets paid back in regular payments at a fixed interest rate for a given period of time – hence the name "term" loan. The term is generally anywhere between one and five years.

The purpose of this type of loan is to allow you to make a large purchase for your business like new equipment or upgrade your facility. There are few restrictions to a business term loan, and most businesses that have good credit and generate revenue will qualify.

Term loans we can help you find at Horizon feature:

• 5 - 10 Year Term
• No Minimum FICO
• Up to $250k
• Approval in 24-48 Hours
• Monthly payment program, can also be used to consolidate existing loans

If a term loan doesn't sound like the right solution for your business, simply fill out the contact form below or call us at 1 866-454-1615 and one of our team members will assist you.

A line of credit is a flexible business financing option that allows quick access to a defined amount of working capital. The way it works is a business is approved for a set amount of credit and has access to that amount through a streamlined process which allows for quick and easy access to drawing on the approved amount when needed. The full approved amount does not need to be drawn at one time, but rather you can choose to draw only the funds your business needs when needed up to the approved amount. Businesses are only responsible for the repayment of the outstanding combined balance on the draws plus any interest or other fees that may be charged.

Don't worry – if you don't see a solution you think is right for you, we're here to help. Simply fill out our contact form at the bottom of this page and a member of our funding advisor team will be in touch shortly to learn more about your unique business needs.