Credit Card Financing

The use of credit card financing usually refers to business cash advances in which working capital is obtained by business owners based upon future credit card processing activity. What we want to highlight here is the increasing use of personal credit cards by small business owners to obtain operating cash for their business. As we have reported in the Business Loan Help section of The Working Capital Journal, because many lenders have suddenly reduced or cancelled business lines of credit, small business owners have increasingly been forced to rely on cash obtained via credit cards to sustain their businesses. We strongly urge all commercial borrowers to review our discussion entitled “Credit Cards — Predatory Lending at its Worst” in order to prepare for some undesirable actions being taken by many lenders which have a substantial credit card loan exposure.