As small- and medium-sized businesses (SMBs) struggle with access to capital in today’s tight credit economy, American Express today announced the launch of American Express Merchant Financing, a set of financing products that provide qualified merchants with quick and simple access to cash for their business needs. Eligible merchants now have the opportunity to leverage their relationship with American Express to tap into a convenient and hassle-free source of capital, which is repaid automatically through settlement charges and accompanied by low fixed fees.
American Express maintains direct relationships with its merchant customers and, as a result, has a unique ability to meet merchant needs. This innovative financing program enables SMBs to better manage their cash flows on a regular basis and, ultimately, grow their businesses.
American Express Merchant Financing is specifically designed for SMBs that meet a basic set of criteria, including generation of $100,000 to $10 million, in American Express charge volume per year, a minimum two-year merchant tenure with American Express, and no prior account delinquencies. The program offers two lending options for accessing capital:
Monthly: A one-year term with 12 monthly loan disbursements each up to $500,000, where the cash financing amount is extended at the beginning of each monthly period and is repaid in full by the end of each monthly period. The financing amount is based on projected American Express charge volume. A fixed financing fee is charged each month on the financing amount. There are no other fees associated with this product.
Annual: A one-time loan disbursement that is equal to 25 percent of projected annual American Express charge volume, up to $750,000, where the loan is paid down in full by the end of the one year financing term. A fixed financing fee is charged on the annual financing amount. There are no other fees associated with this product.
In stark contrast to traditional commercial lending vehicles, American Express Merchant Financing products provide cash within three business days of enrollment, include an automatic repayment process based on the merchant’s American Express Settlements and require no personal guarantee. Currently, the program is open to qualifying businesses in good standing with American Express. The simple application process, fast approval, and competitive pricing ensure that SMBs can gain flexibility and control in navigating common cash flow management issues.
“Access to operating capital is an ongoing challenge for smaller businesses, as it has become extremely difficult to secure a reasonable loan. In order for these merchants—key drivers of the U.S. economy—to grow and expand, they need a fair alternative,” says Bill Glenn, president of global merchant services for American Express. “As a strong advocate for small business, American Express is continually seeking innovative solutions to help these businesses thrive. With American Express Merchant Financing, we’ve found a way to use our unique business model to fill the financing void for these vitally important merchants.”
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