A Merchant Credit Account can be defined as a cash advance paid by the Merchant Account Provider to a business owner. With the help of a Merchant Credit Account, the business owner can be guaranteed that, their payments will be delivered to their Merchant Accounts for cash advance payments, at any time.

Through a Merchant Credit Account, a business owner can gain access to a working capital for at least the same amount as the current working capital. Basically it’s a revolving credit with collateral future payment.

What is the criterion to obtain a Merchant Credit Account?

The answer is probability calculation. Consider 2 businesses with the same monthly revenue. Business [A] with low per transaction value (but with high transaction frequency) compared to a business [B] with high transaction value (low transaction frequency). Both behave differently in terms of Revenue deviation.

Business [A] suffers less from a 10% failure transaction than Business [B]. But because of the high frequency nature, Business [A] cannot gain the Merchant card account, since the occurrence of transaction is so high. Most banks cannot hold the payment terms. To put it simple, the bank remains more friendly with businesses that pay twice $10 than businesses that pay ten times $2.

Now, while funding sources understand and account for the fact that some months are slower than others - resulting in less being repaid in those months .Hence they like to hedge as much as possible.

Thus, in the end, business [A] is a better candidate for a merchant credit card cash advance than business [B]. So if you are considering a merchant credit card cash advance, understand that smaller ticket items sold in greater volumes are looked upon more favorably than higher ticket items sold in a lower volume.

There are many financing derivatives out there. You may obtain a sales insurance, and combine it with the Merchant Credit Accounts to gain a perfect posture to be approved. With the help of sales insurance, you will have 100% non-deviated earning. You’ll be able to pay the account provider perfectly in all events that may occur to your businesses.

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