An independent sales organization is an individual or group of people who partner with a merchant lender to act as an intermediary between the merchant lender and the business owner who needs loans with direct lenders only. The role of the individual sales organization agent is to locate reputable advance cash lenders and evaluate their suitability for a borrower to obtain loans. Once you find a match, you will arrange for the advance amount and the premium for the two parties to sign an agreement and close the deal. As an ISO, you are supposed to have a common relationship with your merchant cash advance lender.
How ISOs earn
Based on the agreement between you and your merchant cash advance lender, you are entitled to get a certain commission for the advance given to the borrower one you close a deal along with other benefits. However, if you decide to invest your funds in the deal, you will be entitled to get an interest from the payment depending on the amount you have invested. Bear in mind that you can also earn a commission for a portion of the cash advance that you didn’t even finance if you use loans with direct lenders only. While partnering with a merchant cash lender, you can put up some cash or none at all, it all falls back to your preference. It is evident that ISOs work in close cooperation with the borrower and they have a good opportunity to know the problems they are facing. As an individual sales organization, you have an idea to where invest the cash and to which borrower will represent a lucrative investment.
A merchant cash advance company, also referred to as business cash advance is a form of business funding where a business owner borrows cash in upfront in exchange of their future credit card sales. The Loans with direct lenders only are repaid by the company deducting the agreed portion of the each credit card receivable. Alternatively, they can decide to hold back 10 to 20 percent of the total credit card sells depending on the amount of cash advance and the perceived risk of the business owner in regards to payment of loans.
Users of merchant cash advance
Merchant cash advance is the type of lending that is suitable for any business that accepts credit card payments and the one that needs business loans with direct lender only. These businesses include retail businesses, restaurants and the service firms that provide credit card services and have strong credit card sales. Your role as an individual sales organization agent will be connecting merchant lenders and these businesses that need financial help. Since a merchant cash advance is perfect for short-term funding when a company needs money instantly, there is a high chance of closing more deals since these types of loans have high demands in the market.
Merchant cash lenders claim that small business owners benefit from the merchant cash advance industry because the amount paid back is based on the cash flow. This implies that a business owner is allowed to pay less during slow months and pay more when the sales are good using loans with direct lenders only.