As a business owner, taking loans is sometimes necessary in order to either start your business or
enter a new project or venture. Merchant cash advance companies (MCA) are a type of financial
service business that provide short-term funding to businesses in exchange for a percentage of
their future credit card sales. MCAs provide alternative financing to a traditional small business
loan.
What Are Some Advantages and Disadvantages of MCAs?
Some advantages of MCAs is that not only do they provide quick access to unsecured funds,
requiring no collateral, but they are also easy to get, needing not underwriting or credit check.
However, they can carry extremely high APRs and fees; also, they have no grace period,
meaning that credit card cash advances begin accruing interest on day one.
What Licenses Do I Need to Operate a Merchant Cash Advance Businesses in Florida?
To operate a merchant cash advance business in Florida, you will need to obtain a license from
the Florida Office of Financial Regulation (OFR). The specific type of license required for a
merchant cash advance business is a Sales Finance Company License. This license allows you to
engage in the business of making loans or sales finance agreements for the purpose of financing
the sale of goods or services.
In addition to obtaining a Sales Finance Company License, you will also need to comply with
other regulations such as registering with the National Mortgage Licensing System (NMLS) and
obtaining a surety bond. It is recommended to consult with the OFR for detailed information
about the application process, fees and regulations that apply to your specific business.
