American Finance Solutions is proud to announce that we joined the North American Merchant Advance Association (NAMAA) this month. NAMAA is a not-for-profit trade association representing the organizations in the US and Canada that offer working capital advance products based on credit, debit and other electronic payment-related revenue streams to small- and medium-sized businesses. The goal of NAMAA is too shape our Merchant Cash Advance industry by providing leadership, education and sharing of information. With MCA being an alternative financing product for businesses, it is often seen by traditional lenders as a high-risk, expensive and questionable product. Reality is that the Merchant Cash Advance is a fairly priced, un-collateralized business financing that fits its niche in the marketplace. During the infancy of the product in the early-2000s, the product was and sometime continues to be sold incorrectly. The NAMAA recently set Best Practices Guidelines to ensure that all funding companies and agents represent and sell the product properly.
American Finance Solutions has always adhered to these Best Practices since our first day of operation over five years ago, since they are the proper way to do business. For those that do not know the Best Practices, they are six key elements:
1. Provide Clear Disclosure Of Fees
2. Provide Clear Disclosure Of Recourse
3. Be Sensitive To A Merchant's Cash Flow
4. Adhere To Proper Marketing Materials Disclosure
5. Monitor Resellers Of The MCA Product
6. Proper Payoff Of Outstanding Merchant Cash Advance Balances
In addition, NAMAA members all contribute to fraud prevention on both the client and agent side of the business to protect members from unscrupulous individuals. American Finance Solutions looks forward to contributing to the NAMMA organization and helping shape a strong MCA industry that continues to prosper in the future.
