No-Doc Business Loan Options: Overview for Business Owners

Updated on:
June 20, 2024

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Every small business owner understands the struggle of securing the right financing options. But understanding loan options, loan amounts, and which type of loan is right for you, completing loan applications and grasping the documentation requirements can be daunting. For busy business owners loans, SBA loans, and business lines of credit which all require a mountain of paperwork, including tax returns, financial statements, and a detailed business plan is often just not feasible. This application process can be long and frustrating, especially for new businesses, startups, or those with bad credit. One such example is the elusive Low-Doc or No-Doc Business Loan, often requiring an impeccable credit score and a slew of other eligibility requirements.

At the other end of the spectrum are business credit cards, which promise quick access to working capital with minimal paperwork. The trade-off? Exorbitantly high interest rates that can sabotage your cash flow and destabilize your business finances. The question then arises, are there alternative options that balance the accessibility of business credit cards and the structure of business loans? The answer is a resounding yes – Merchant Cash Advances (MCA).

Merchant Cash Advances: A Convenient Alternative

Merchant cash advances offer an innovative approach to business financing for those that want the ease of less paperwork. They are a great alternative for borrowers who might have difficulty qualifying for a bank loan or online lender due to a less-than-stellar credit history or the type of business they operate.

The great thing about MCAs is that you aren’t a borrow because you are simply taking an advance on your future revenue. You repay it as a percent of your future revenue so if your revenue goes down, so do your payments making a much more flexible solution.

Unlike lenders, which require extensive documentation for a small business loan, MCA providers only need three to four months of business bank statements to qualify. This simpler and faster online application is one of the reasons why small business owners increasingly turn to MCAs over other financing options.

A More Accessible Type of Financing

Merchant cash advances come with flexibility in terms of eligibility. Whether you’re an entrepreneur with a new business or a small business owner managing a longer-established enterprise, your credit history or annual revenue won’t be the determining factor for approval. Rather underwriting is considering your business’s cash flow, as indicated in your business bank statements. Some may also want to review your accounts receivable, but this does not slow down the funding process as they’ll often be able to make an offer the same-day.

Understanding the Structure of MCAs

MCAs are unique in their repayment* structure. Banks, credit unions and other business lenders often set fixed monthly payments, and higher interest rates may apply for short-term business loans. On the other hand, MCAs are tied to a set percentage of your revenues. This structure ensures the repayment terms are proportional to your business’s income, safeguarding your working capital during lean periods.

Other Reasons to Consider a Merchant Cash Advances

Not only do MCAs require less paperwork, there are several other reasons that you may want to consider this financing option, even when compared to so-called alternative funders such invoice factoring for equipment financing companies.

MCAs offer faster access to funds, available in as little as 24 hours, or up to a few business days, which is much faster than loans from banks or other financial institutions which can take weeks or months. You also do not have to worry about putting up real estate as collateral.

Some loan programs, especially those through the small business administration, set restrictions on how you can use the lump sum proceeds of the loan. That’s simply not the case with MCA proceeds. Renovations? Sure. Advertising campaign? Why not. Purchase new equipment. That works too. As long as you are using the funds to help your business, you have all of the flexibility to use the funds as you see fit or simply have extra working capital.


Navigating the world of business financing can be complex. Small business owners often feel torn between the onerous application process. Merchant cash advances emerge as a compelling funding option, balancing convenience with accessibility and providing quick funding based on your business’s natural cash flow. Always remember to assess all financing options carefully, considering your business needs, the health of your bank account, and your comfort with the repayment terms.

*Repayment in this context describes the process of repurchasing a merchant cash advance. It does not describe the process of repaying a loan. MCAs are legally distinct from loan products.

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