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RapidAdvance Review

Best Alternative Lender for Merchant Cash Advances

A Business News Daily Review

Product and service reviews are conducted independently by our editorial team, but we sometimes make money when you click on links. Learn more.

Merchant cash advances are an ideal form of financing for businesses that deal heavily with credit and debit card transactions. To help manage cash flow, businesses can get an advance on their credit card sales and then pay the loan back as a percentage of future sales. This means your monthly payments are tied to your revenue and not a fixed payment that you have to meet.

After much research and analysis, we recommend RapidAdvance as our 2018 pick for the best alternative lender for merchant cash advances. To understand how we selected our best picks and view a comprehensive list of alternative lenders, visit our best picks page.

RapidAdvance has an easy application process, quick funding and excellent customer service. Business owners can also get an advance of up to 250 percent on their credit card sales, which is one of the highest advances of any company we reviewed. Here is a breakdown of why it's our best pick.

Editor's Note: Trying to find a business loan that's right for you? Fill in the questionnaire below, and you will be contacted by our partner alternative lenders, who will help you find the right loan for you.

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RapidAdvance has a simple and short application and approval process. You have the option of either filling out an online application or calling the company to provide your information directly to an account executive. You are asked some initial basic questions – where your business is located, how long you've been open and your total monthly sales – to help you get an estimate of how much of an advance you might be eligible for. 

Once you've been prequalified, the company provides a preliminary funding amount. This isn't the amount you may ultimately be approved for, but it gives you an idea of how much of an advance you might receive so you can make an informed decision on whether to proceed with the application process. We like that RapidAdvance gives you this early estimate. It's an ideal way to get an understanding of what you qualify for and whether RapidAdvance is the right company for your financial needs. Most of the other lenders we examined don't provide an estimate until the entire application is complete.

If the estimated advance is in line with what you want, you continue filling out the application, which asks for your business's legal structure, your estimated monthly credit card sales, how much money you need and what you plan to use it for. After submitting this information, you get to see a more accurate loan amount. You then need to confirm your total monthly revenue and credit card sales by providing bank and credit card statements.

An underwriter will review all the information and run a credit check to determine if you're ultimately approved for a cash advance and, if so, the amount and terms. The approval process can be completed within a couple hours, with funds available as fast as in one day. This makes RapidAdvance an ideal quick funding option. 

Several variables determine which businesses qualify for cash advances. Your business's total monthly revenue and credit card sales, as well as your credit score, determine your eligibility. Overall, RapidAdvance has pretty relaxed qualifications. The company focuses mainly on your revenue and not credit score when reviewing loan applicants.

Although there are no exact rules about who gets approved, there are several minimum requirements you must meet to even be considered. Your business must …

  • Have a physical location.
  • Have been in business for at least three months.
  • Process at least $2,500 a month in Visa and MasterCard receivables.

RapidAdvance's minimum requirements for the time a business needs to be open and its credit card revenue are lower than what most lenders require. Many lenders require businesses to be established for at least a year before they can get funding. RapidAdvance provides various funding levels based on qualifications, with more established businesses able to qualify for more funding.

Merchant cash advances are different from traditional small business loans. With traditional small business loans, you make monthly loan payments, but cash advances are paid back via credit card sales. You repay the loan by giving RapidAdvance a fixed percentage of your future Visa, MasterCard, American Express and Discover card sales until the predetermined payback amount is paid off.

One way that RapidAdvance determines the exact percentage it will charge your company is by comparing your total monthly sales to your monthly credit card sales. Businesses with a high proportion of credit card sales typically have a lower fixed percentage fee, while those with lower credit card sales have a higher percentage. Your business's financial history and other qualifications also go into interest rate consideration.

What makes cash advances so attractive is that payments are linked solely to your business's daily credit card sales, so when sales are slow, payments are small. We like that there are no monthly minimums with RapidAdvance. Some of the other lenders we considered require you to pay a minimum amount each month, regardless of credit card revenue. This model means you pay off more of your loan when your business is doing well, while RapidAdvance will take less money when sales are down.

RapidAdvance doesn't make you change credit card processors to get an advance. Many of the other lenders we looked at have specific lists of processors you need to use, or require you to switch to their preferred processor for you to be eligible for a loan. If RapidAdvance doesn't have a relationship with your credit card processor, it sets up a pass-through account. If RapidAdvance does work with your processor, the credit card processor will withhold RapidAdvance's percentage from your credit card sales and transfer that money directly to RapidAdvance on a daily basis.  

RapidAdvance has two different tiers of cash-advance programs: Starter and Premium. With the Starter program, which is designed for new businesses, you are eligible for funding that is 50 percent of your average monthly credit revenue. It is easier to qualify for a Starter merchant cash advance. Premium programs provide funding of up to 250 percent of your monthly credit card volume.

In addition to time in business, the specific size and cost of an advance is based on business size, industry, processing history, volume and average size of credit card transaction.

Besides the cost of the loan, there are no additional fees with RapidAdvance. Many of the other lenders we considered tack other costs onto the loan, such as fees for origination, application and closing. Additionally, RapidAdvance doesn't require a lien to loan you money or file UCC-1 documents as many other lenders do.

Once you have the loan, there are no restrictions on its uses. Some of the other lenders we evaluated place limitations on how you can spend the money. The lack of restrictions and collateral requirement make RapidAdvance's loans flexible for small business owners looking for quick funding.

We were very impressed with the customer service we received from RapidAdvance. To test the type of support you can expect, we called the lender multiple times, posing as a business owner interested in a cash advance.

Each time we called, a representative answered quickly. These reps skipped the hard sell and instead spent time answering our questions. Most of the other lenders we spoke to were more interested in determining our loan eligibility before they answered any of our questions.

Throughout our calls, all our questions were answered thoroughly and in enough detail to leave us with a clear understanding of how RapidAdvance's merchant cash advances work. Some of the other lenders we spoke with either couldn't answer all of our questions or offered short answers that didn't give us the clarity we needed.

After our calls, the representatives followed up with an email encouraging us to contact them with any other concerns. We did send follow-up questions on several occasions to gauge the type of reply we would get. Each time, we received a response – containing thorough answers – within minutes.

You can reach the RapidAdvance customer service department by phone or email between 9 a.m. and 6 p.m. (ET) Monday through Friday.

RapidAdvance is an accredited member of the BBB with an A+ rating. As of June 2018, there had only been four complaints filed against the lender over the past three years. That is far fewer than some of the other lenders we considered. You can read more about the nature of the complaints on the BBB website. The company also scored 4.9 out of 5 stars on 159 customer reviews. The number of positive reviews was significantly higher than the negative ones, cementing RapidAdvance as a company that provides a solid service.

The biggest downside of RapidAdvance is that it doesn't work with online businesses. To qualify for a loan, you need a physical location, which many small and new businesses don't have.

Ready to choose an alternative lender? Here's a breakdown of our complete coverage:

Editor's Note: Trying to find a business loan that's right for you? Fill in the questionnaire below, and you will be contacted by our partner alternative lenders, who will help you find the right loan for you.

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Matt D'Angelo

Matt D'Angelo is a B2B Tech Staff Writer based in New York City. After graduating from James Madison University with a degree in Journalism, Matt gained experience as a copy editor and writer for newspapers and various online publications. Matt joined the Purch team in 2017 and covers technology for Business.com and Business News Daily. Follow him on Twitter or email him.