Hemp & CBD Working Capital Funds
The demand for legal hemp is high and the hemp industry is expected to grow significantly over the next decade. When you need fast cash, your options are often limited, especially being a Hemp Related Business (HRB). CBD, Cannabis, and Hemp working capital funds can be used for a number of uses that might require a quick injection of capital.
What is a Hemp Working Capital Loan?
A hemp working capital, bridge loan or merchant cash advance is not technically a loan. With this product, you are advanced cash in exchange for a percentage of your daily credit card and debit card sales, or your monthly revenue. Working Capital can be a quick and easy way to get a Hemp related business (HRB) cash advance with no need for collateral, even if you don’t have a good credit score.
Hemp Working Capital Details
Hemp Working Capital Pros vs Cons
How Does a Hemp Working Capital Loan Work?
A hemp working capital loan is like the Swiss Army Knife for hemp operators – it’s handy, flexible, and able to get you out of a bind. The funds are typically unsecured and you can use it to cover unexpected costs, upgrade your equipment, finance a short term project, or even capitalize on a new business opportunity. It’s definitely the loan you want in your back pocket as a hemp operator.
It’s pretty simple, you borrow a lump sum of money over a short term, typically under 2 years. With a fixed interest rate – the factor rate, you pay back the loan in daily, weekly, bi-weekly or even monthly payment installments. Once the loan is paid 50% in, you can borrow additional funds.
Who Qualifies for Hemp Working Capital?
Would your Hemp Related Business (HRB) be eligible for a cannabis merchant cash advance?
If you have little or no collateral, limited business history, or a low credit rating, merchant cash advances could be a solution to your financing problems.
Many merchant cash advance providers tend to have easy eligibility standards, however when it comes to a hemp – not all accept this industry because it’s still considered high risk. But with Upwise Capital most hemp businesses shouldn’t have a problem qualifying.
For businesses that make a big portion of their revenue through credit card payments—if you own a dispensary or product, for example—then you can use a merchant cash advance as a short-term financing tool. It can help with working capital, inventory, build-outs, purchases, cannabis equipment, debt payments, unexpected payments, and more.
Hemp Loan Requirements
* Note: These hemp working capital loan requirements are based on previous Upwise customers and is just an average.
What Does a Hemp Working Capital Loan Cost?
Let’s look at how you can calculate the actual cost of a hemp merchant cash advance.
A Cost Example of a Working Capital Product
Say you’re advanced $20K with a factor rate of 1.18.
$20K multiplied by 1.18 is $23,600, which is what you’ll need repay with your daily credit card transactions.
At first glance, that might seem like you’re just paying a 18% interest rate—but looks can be deceiving.
You have to determine the true cost of the merchant cash advance by its APR.
If your lender will be taking 15% of your future credit card sales and you’re estimating $25K a month in credit card transactions, you’d repay that advance in 189 days with daily payments of $125.
That’s an APR of 65.96%—quite a bit higher than it originally looked.
When is the Cost Worth It?
Hemp cash advances, while fast and convenient, tend to be worth their price only if you’re confident you can repay them quickly and without much harm done to your cash flow.
Just be sure to shop around and see if you can qualify for other types of loans before moving forward with a merchant cash advance.
How do you know whether a merchant cash advance will make sense?
On the one hand, paying off a loan with daily credit card sales can bite into your cash flow more than you might expect.
On the other, you’ll actually repay a smaller amount of money during slower weeks and months—unlike with a term loan, where you’ll either make your payments on time or suffer the late fees.
There are other reasons why some borrowers might want to opt for a merchant cash advance rather than a more traditional business loan.
For one, merchant cash advances come unsecured—meaning you don’t have to offer a valuable piece of collateral in exchange for the loan. This can be a benefit for business owners who don’t want to put something like their personal home or financial assets at risk.
And finally, merchant cash advances are quick. Need cash this week? A merchant cash advance can probably be approved by then.
These two advantages correlate with high costs, though. So when it comes down to it, it’s up to you to understand your business’s financials. Just remember that a merchant cash advance is the most expensive financing option you could pick.
How to get a Hemp Working Capital Business Loan
We make it easy, simply apply online and we’ll be in touch to go over your options.
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Documents You'll Need to Apply
- Completed Application
- Driver’s License
- Voided Business Check
- Business Bank Statements (Last 6 Months)
- Credit Score
You may also be requested to provide the following for larger dollar amounts over $100K:
- Balance sheet
- Profit & Loss Statements
- Business Tax Returns
- Personal Tax Returns
- Account Receivables Report (if securing AR)
- Inventory List (if securing inventory)
*See above for cannabis working capital loan requirements.
Who We Serve in the Cannabis + Hemp + CBD Industry
Hemp Related Business (HRB) working capital loans can be used for launching a new product, brand, dispensary & much more!
Hemp Working Capital Funds
Driven by consumer demand and medical potential, the cannabis industry is one of the fastest growing industries in history. Medical programs are approved in 33 U.S. States, social consumption legalized in 10 U.S. States, federal legalization in Canada, and there are more than 32 countries with approved medical cannabis programs.
What Are My Other Cannabis Loan Options?
We Solve Your Problems
Explore Your Cannabis Business Loan Options
Cannabis Non-Dilutive Debt Capital
Use working capital funds instead of giving away equity for your business growth.
Cannabis Equipment Financing
When building a new facility or upgrading existing equipment see our financing options.
Cannabis Real Estate Financing
Purchases, Acquisitions or Leverage your real estate to get the funds you need.
Cannabis Construction Loans
Financing to build out your cultivation, processing, distribution or retail facility.
Cannabis Sale - Leaseback Program
Sell your facility or equipment to free up cash and lease it back with an option to buy.
Cannabis Inventory Financing
Increase your purchasing power and grow by having more products & inventory on hand.
Cannabis + Hemp + CBD Services Available From Upwise
Upwise Payment Processing accepts all types of credit and debit cards for brick & mortar, e-commerce and wholesale.
Cannabis financing programs provides small businesses with working capital loans of up to $20 million for almost any purpose.
CBD Financing can help businesses respond to opportunities and challenges regarding anything CBD or Hemp related.