Are you a startup founder struggling to grow your business to the next level?
Startup financials can be quite stressful, but most of the time it also drains your personal finances and you may have to face a financial emergency!
It can be a personal emergency like a sudden car repair, unexpected medical bill, or large electricity bills that need immediate cash. Or else a business emergency like vendor payments that cannot wait, and your account receivable is still pending clearance.
In these situations, you might need a cash advance loan quickly. Before you start looking for one, here’s everything you need to know.
Startup Founder’s Guide to Meet Urgent Money Needs with a Cash Advance Loan
What is a Cash Advance Loan?
It is also known as a payday loan, post-dated check loan, high rate loan, and deferred deposit loan. This form of credit service allows you to borrow money immediately. People who have a poor credit history can avail of this fast cash loan.
It is a short-term unsecured loan that you avail to pay off any bills or fees without using credit. Generally, the providers will charge you a high fee or interest, and there is always a limit to the amount you can borrow.
How Does It Work?
Before opting for an advance loan, you need to know the process. Here is how it works –
Research about the Trusted Cash Advance Providers
A cash advance loan is different from payday loans. Usually, the payday loan will charge you a higher fee with interest. Know the risks as it can, sometimes, do more harm than good.
Here, it’s imperative to go through the fine print, ask relevant questions, and review the terms carefully beforehand. Before getting a cash advance, make sure your service provider is reputable and well-known and has low-interest rates.
Join Our Small Business Community
Get the latest news, resources and tips to help you and your small business succeed.
Know the Limits
Your provider might have a constraint on how much money you can borrow with a cash advance at the same time. Banks or providers might want you to submit a pay stub as proof of your income to figure how much you are eligible to borrow. You can link your checking account, and they will let you know how much you qualify for instantly.
Understand the Fees and Interest Rates
Perform advance research about the fees of these loans to know how much you’ll incur the money you need to borrow. Know the interest rates and any additional fees that you will be paying while taking out an advance.
While some banks might charge you high fees and interest rates, some other options won’t cost you that much.
Contact Your Bank
Since cash advances aren’t secured with cash, the bank might ask you for a proof to make sure you have enough funds available to pay off what you borrow. There are several kinds of verification that you need to complete before you can receive your advance. Follow your bank or provider’s steps strictly for your best chance.
Wait For the Bank to Confirm Account
After connecting with the bank and confirming your account, you may have to wait for a while until your bank verifies your salary.
Receive the Money
Upon receiving your request, the lender will give you approval. After this step, your money is instantly deposited into your account.
A cash advance loan could be a good fit if you like to make regular payments and require a few weeks to pay back the loan. It could also be a suitable option if you need to borrow a substantial amount instantly.