Working Capital For Your Medical Marijuana Business 

February 15, 2017

If you’re selling marijuana legitimately, you deal with high costs for security, high rents, and large overhead (including mega-high electric bills). Moreover, your equipment should be rather expensive too. You should also know that getting working capital for your business is intimidating.

Of course, you’ll have difficulty getting approved for a traditional bank loan, but you can apply for alternative business funding options to make things easier. Consider turning to a reputable business funding provider like First American Merchant. FAM offers the lowest possible rates for business loans, including a medical marijuana business loan.

Merchant Cash Advances or Business Cash Advances are a great option to try. They are becoming one of the most popular forms of small business funding. Today, many merchants choose a Merchant Cash Advance over traditional business financing.

It’s important to note that a Merchant Cash Advance isn’t a short term loan or a high interest advance. This product operates differently as compared to typical working capital loans. In the case of a Merchant Cash Advance, you deal with a fixed payback amount and not a fixed payment. The former is a portion of your daily credit card sales (usually 10-15{083390938f484c452e08a84ea1fac0a9158b26745442978ab7ea4003b5815b10}) that are redirected to the advance provider.

In fact, it’s simply a sale. First American Merchant is purchasing your future sales at a discount. Both parties agree to the amount of sales being purchased and for what discounted cost. Let’s compare small business funding with a Merchant Cash Advance:

Small Business funding

  • Strict credit requirements
  • Long wait times for funding
  • Complicated contracts
  • Extensive documentation
  • Lower approval rates

Merchant Cash Advance

  • Credit scores below 500 are approved
  • Receive your funds within 72 hours
  • Simple, flexible programs
  • No tax returns or financials are required
  • Fast application process

According to the Marijuana Business Association, to start a cannabis business in the US, you should invest more than $1m. Costs associated with licensing fees, rent, and equipment are typically rather high, depending on which state you’re in, as different states have different regulations.

Many traditional banks and financial institutions will stay away from your business so you should turn to a reliable alternative business loan provider like First American Merchant to get the necessary funds for your medical marijuana business.