AFS Launches New Agent Portal

American Finance Solutions launched a new Agent Portal in early April. Previously our Agents and Partners could only track their commissions through our website in real time.

We have taken the effort to roll out a complete support tool for our agents that allows them access to sales training, almost all of AFS' forms needed to submit and complete contracts, and all of our partner processing companies applications and supporting forms. The most significant piece is our FAST CASH contract generation.

The FAST CASH contract piece allows agents to create, save, print and email a complete PDF package to their clients in just minutes and auto attaches all the necessary partner processing forms as well. Agents simply log in to the portal, enter in their clients pertinent data (including the previous four months credit card processing volumes), select the partner processor who will doing collecting of the split withholding and hit submit. The system will auto-calculate how much the client qualifies for and create a complete submission package.

The entire process of generating contracts should take less than ten minutes after one becomes familiar with it. Hopefully this new tool will lead the industry again, in customer service by empowering our sales agents and giving them the ability to close more deals in less amount of time! AFS is really trying to deliver on the promise of "simplifying cash advance"

To learn more about partnering with American Finance Solutions please visit our website americanfinancesolutions.com or call 800-760-5516.

MCA Agents Getting More Diversified

The response to the last blog post on the current state of the merchant cash advance (MCA) agent landscape was overwhelming. Ninety-five percent positive and a few negative criticisms. Many of you emailed asking for more insight about the agent network. So here it goes.

American Finance Solutions as a funding company is seeing a more diverse agent network in the past 12 months. Yes, our core agents are traditional ISOs that sell credit card processing along side merchant cash advances. However, we are seeing the majority of new inquiries coming from those that have never represented the product and quite often they just learned about the MCA product through a client, friend of colleague.

So who are these new agents? Most often they are current financial advisers or offer ancillary financial services; such as accountants, CPA firms, business brokers and attorneys. As the popularity and acceptance of merchant cash advances grows, I think we'll see more and more of these types of agents offering MCA in their product mix.

These new agents do however offer new challenges to funding companies in the way of training. First off they've usually lack complete product knowledge and often confuse the MCA with a traditional credit line. I cannot count the number of times I've been on the phone with a CPA and say for the tenth time, "There is no interest rate!" It is important to have simple, step-by-step, training materials for this type of new agent. AFS recently rolled out a new Agent Portal which we've been told has the most comprehensive training materials in the industry.

The larger challenge is that these agents have never sold credit card processing. It is very difficult to successfully sell a MCA without selling processing (which in my opinion takes ten times the product knowledge with equipment, POS systems, rates, etc). To effectively sell you need to effective sell both products with the basics feature/benefits.

At American Finance Solutions we never take a cut of the processing and thus do not benefit financially from the processing. While we attempt to educate these new agents to the best of our ability, it is really in their best benefit to partner up or hire someone/processor with the experience in merchant services that will take the time and patience to show them the ropes. AFS has developed relationships with processors that have great training and customer support teams that take the time to walk new agents through the application, pricing and conversion process to signing up (known as "boarding" in the industry) new merchants.

While these agents do not provide the volume of applications and funded deals, they do tend to submit high quality deals that usually have an approval rate well above 75% which makes sense. Their current clientele is generally a more established, sophisticated client that cannot access capital as in previous years. Also, the clients are usually not seeking maximum cash from the MCA which allows for shorter expected payback times and thus lower factor rates (and much less risk for the funding company).

Funding companies may not see the sheer volume out of this agent network, but if we take the time to educate and train them, the quality of clientele and overall portfolio will improve.

MCA Sales Agent Landscape - Four Funders Agree!

This past week I had the pleasure of sitting down with one of our competitors for lunch. This smaller company is one of the few that has been able to successfully raise capital and grow smart and slow with ultra-conservative underwriting. Since then I've called a two of the CEOs of our larger competitors to talk shop with them and confirm the current state of the industry and most importantly the sales agent landscape for Merchant Cash Advance.

The largest surprise in the industry is that while demand for Merchant Cash Advance is rapidly increasing, the "traditional" agent network is shrinking. On average most funding companies have seen anywhere from 20 to 25% of their ISO agents going out of business. The good news is that the majority of these agents are those that jumped on the MCA bandwagon after the mortgage collapse.

Gone are most of the large, boiler rooms pounding the phones with press "1" campaigns that were slamming and jamming MCAs down merchants throats and forcefully taking large broker fees. The costs associated with running such operations are just too costly. What's left are ISOs that focus on processing, providing good customer service and offering MCAs when it makes sense for the merchant.

At AFS we've worked hard to deliver outstanding customer service (and yes we still have a long way to go) to our agents and its paid off well. Those agents that have really partnered with us now have impressive portfolios of 40, 50 and even 100-plus merchants that continually renew their merchant cash advances and payback terrific. We consistently are cutting renewal and residual checks in the five-figures to some agents (and that doesn't even count the processing residuals!)

If your selling MCA or considering selling MCA, I can't think of a better time. Product demand is on the rise, sales competition is decreasing and most funding companies that have survived are consistently approving and funding deals. One just needs to decide if they are going to be the hare or the turtle in the game. Yes, the hare gets off to a fast start and makes some quick bucks but soon things catch up to him. Meanwhile the turtle focusing on building a strong client base with integrity and customer service. We all know who ends up winning the race.

Roller Coaster Ride: The Current State Of Funding In The World Of MCA

If your selling Merchant Cash Advances, you know that it may seem like a roller coaster ride for the funding companies! While American Finance Solutions continues to consistently fund deals month-in-and-month out at the same rate, we are hearing a completely different story about much of the competition.

One of the larger players in our space recently got a fresh round of funding (a reported $20M) from their private investors and turned the faucet at full blast! Most of in the market place will know who it is. While that is great in the short-term for Agents, what happens when the money stream gets shut off (as it appears to abruptly have)? The key is to find good funding companies that are well financed, operate and underwrite in a consistent manner and are transparent in their deal guidelines and underwriting qualifications.

Those of you representing AFS know that we follow the above guidelines. From what I understand there are two or three other companies that do as well, such as AdvanceMe and BFS. Its interesting to note that the three companies with the best reputation on the street for consistent funding, also have traditional, institutional financing behind them.

This provides two key advantages:

1. It provides us with a low cost of funds, which results in a lower cost for the merchant and/or higher commission rates for the agents.


2. Our financing partners require us to maintain a solid portfolio of clients to protect our and their interest. This results in good operating standards, pricing, underwriting and customer service. Without it, bad debt starts to spiral out of control as soon as you turn on the funding spigot.

If you haven't figured it out by now, these two key advantages lead to long-term stability. Something that is important to remember when calculating your renewal and residual income which quickly grows to the mid- to high-four figures each month for most agents for some reaching into the five-figures each and every month.

Each funding company has it specialties and works in unique ways (such as set pricing programs that are a no-brainier to sell, custom pricing for seasonal merchants, starter advance programs, etc.) If your selling MCAs, its best to work with two or three good funding companies to concentrate your deals and get to know how they operate, what they like and most importantly know what will get funded to get you paid.

As always, AFS, welcomes all reputable agent inquiries, from those whom close a deal every quarter to those closing a couple a week.