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United Kapital is revolutionising small business funding in the UK. Official figures show lending to businesses continues to be an issue. Small to medium sized business’ rely on their bank where you can be met with raised overdraft charges, refusal of new loans or worse still calling in the existing one.
Realising the power of United Kapital Merchant Cash Advance as an alternative to the bank, allows you to make an informed and educated decision between the two major finance areas.
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Below is a comparison chart that will highlight
the differences between the two: |
| Reason |
The Bank |
Merchant Cash Advance |
| How easy is it to obtain working capital |
Small business loans are based on your ‘credit score’. The qualification score is usually difficult to achieve. |
Merchant Cash Advance base the funding on the volume of your business. United Kapital offer high approval rate and a faster turn around on funding. |
| Security needed for the money? |
Banks usually insist you put up an asset to secure the finance and also require you to sign a personal guarantee. This means you have all the risk and could lose these assets if you miss payments. |
Merchant cash advance are completely unsecured and have no personal guarantee your assets are completely safe. |
| How long are you tied in? |
Banks demand payment on a fixed schedule. Missing one of these payments can reduce your credit score and increase risk for lending in the future |
The repayments are flexible and work alongside the ebb and flow of your day to day credit and debit card revenue, as this is taken as a percentage of your sales not a fixed amount. |
| How much will it cost? |
The total repayable interest, which is the interest charged over the whole repayment period, can be anywhere from 20% to 300% total interest repayable. |
Merchant cash advance has a one off fee, a factor of 1.38. £10,000 is paid back at £13,800. It is not an interest rate. In 6 to 9 months you are debt free and have an opportunity to renew your advance. |
| Which is best for your business? |
If you manage to get a low rate and you don’t mind putting what you own as security against it then go with the bank |
If you want to pay over a shorter period of time. No assets will be at risk with a product that is flexible with your business activity then a merchant cash advance is for you |
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United Kapital is a limited company No 06575165. The merchant cash advance programme funding is provided by United Kapital (not Bank of Scotland). If accepted for the programme, United Kapital will advance cash to you and Bank of Scotland Merchant Services will pay a portion of your future card sales to United Kapital. Bank of Scotland Merchant Services is a service provided to Bank of Scotland by First Data.