What is Working Capital?

Working Capital is an alternative source of funds for entrepreneurs to help grow their business. In this kind of specialty business financing, a business owner can receive a lump sum of capital from a business funding lender in exchange for a certain amount of their business’ future credit card sales. Working capital provides many benefits, from a simplified application process, to quick access to funds, and credit protection.

Simple Application

For starters, applying for working capital is quick and easy, as is the collections process. More often than not, you can fill out your application online. Applications may require providing specific information and documentation pertaining to your business, such as recent credit card statements and your Business ID. This process should not take long to complete, and most providers typically respond within 48 hours. Unlike loan options from well-known providers that may require more strict credit requirements, documentation, and contract agreements, working capital is not based on personal credit history. With a higher approval rating, this simple process lets you stay focused on your business while still having the opportunity to grow and receive the funds you need.

Credit Rating

A history of bad credit can prevent you from obtaining funding from a traditional lending source. If your business has been labeled as “high risk” or you struggle from a history of bad credit, business financing may be exactly what you need. One of the advantages of working capital is that those with bad credit can still be accepted, regardless of their score. In addition, securing business financing will not negatively affect your business’ credit. This is because you’re not taking out a loan, instead, you’re simply trading future credit card sales for capital and business funding. Since a working capital is not a loan, you will not have to worry about making binding monthly payments. Instead of wasting time trying to improve credit before applying, you can use received funds from working capital to pay off debt and achieve a better score.

Avoid Bank Loans

As previously mentioned, working capital is not a loan. This can be beneficial to you in multiple ways. This form of specialty business financing is a sales transaction and does not have to be reported on credit reports. While the merchant cash provider buys the right to retrieve a portion of the business’ credit card sales each month, the business is able to receive a lump sum that is paid to them at the beginning of the agreement. A commercial loan can take weeks or even months to successfully process. Working capital, on the other hand, can be available within the same week that the application is processed. Another benefit of choosing working capital over a traditional business loan is that it does not require any high-risk collateral.

Receive Working Capital for Your Business

One of, if not the best, part of working capital is the quick access to capital. This funding can be used to grow your business the way you want without a bank looking over your shoulder. Working capital helps alleviate some financial pressures, thus lowering your stress and influencing more positive business endeavors. Let us at Lendr help you achieve your business goals. Contact us or apply for business funding to begin your application process!