If you are a new business and need more capital, you may have a harsh reality when the bank denies your loan even with semi-good credit. Banks and credit unions have made getting business loans harder than ever with more criteria needed in order to be approved.

This has left new business owners unable to continue with their small business loan dreams due to lack of cash. However, a merchant store loan alternative may be just what is needed to get the capital to continue business owner's dream.

A merchant advance is a loan that is easier to qualify for since it is not as strict about credit as it is how much the business currently makes and what the projected sales are. The loan is paid through future sales and whenever a credit card or debit card is run, the lender gets a percentage to help pay the loan off.

The interest is higher than a traditional small business loan, but since the loan payments are based on sales, it can be a better option, in many cases. Often the only thing standing in the way of a bank loan is a credit score, but with a merchant advance loan, this problem is removed.

While the interest may be higher on an alternative loan, for many small businesses, it is the best way to obtain the capital needed. A bank loan, while having less overall interest on the loan, is not flexible in the repayment. Flexibility is what small businesses need and why this type of loan has gained in popularity.

If you are just getting started in your business and have been denied a small business loan, do not feel bad, the majority are not approved. The almost impossibility of obtaining a traditional small business loan has left the door wide open for alternative solutions such as a merchant cash advance loan.

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