Expansion Capital Group does not extend traditional loan arrangements but offers financing through merchant cash advances. Under this type of agreement, Expansion Capital advances you a lump sum, which you must repay in addition to a flat fee representing a percentage of the advance amount. Repayments get withdrawn automatically from your bank account in daily or weekly frequency. This differs from other merchant cash advance services that deduct payments directly from your credit card sales.
There are no restrictions on how funds are used. With a merchant cash advance, you can:
- Purchase new equipment
- Hire new workers
- Train staff
Expansion Capital merchant cash advances feature:
- Amounts from $5,000 to $300,000
- Repayment terms of 3 to 12 months
- Factor rates (rather than interest rates) of 1.2 to 1.6, meaning that in addition to repaying your cash advance, you must repay a flat fee from 20% to 60% of the original advance amount.
- Origination fees, which are not disclosed until a loan offer is extended
- Automatic daily or weekly repayments
Expansion Capital Group prices your repayments by using factor rates instead of interest rates. Factor rates charge you a fixed fee, expressed as a multiplier or percentage of the amount advanced. This is in contrast to repayments based on interest rates, where the amount you repay can fluctuate depending on the amount of principal you still owe. For instance, if you receive a cash advance of $300,000 at a factor rate of 1.6, you must repay an additional 60% of the amount advanced. So, your total debt is $480,000 (plus any additional fees, such as origination fees).
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