American Express Merchant Financing: Small Business Loans Review

About American Express® Business Gold Card

American Express® Business Gold Card

American Express® is a diversified global company that provides innovative payment, travel, and expense management solutions for individuals and businesses. Most of all, we are dedicated to helping our customers - Merchants and partners realize their aspirations through industry-leading benefits, business-building insights and capabilities, and our unique business model. Founded in 1850, we started as an express mail business and are now a recognized leader across multiple payment categories. American Express is unique in the market in that we operate as a payment network, merchant acquirer, and card issuer.

What is American Express Merchant Financing?

American Express is a financial services firm headquartered in New York City. The firm, founded in 1850, is one of the components of the Dow Jones Industrial Index of 30 large companies. Though it’s best known for personal and business credit cards, the company also offers merchant financing from $5,000 to $2 million for qualifying companies that accept American Express.

Lender highlights

The American Express Merchant Finance product resembles merchant cash advances from other institutions, in that it’s a short-term loan paid back through future receipts. The company makes money on the loan through a fixed fee that ranges from 1.75 – 20% of the loan, depending upon the type and term of the loan. Though the high-end of the fees American Express charges may seem high, it’s worth noting that fees for merchant cash advances can be as high as 75% or more.

What American Express Merchant Finance offers

The company offers a commercial loan to businesses that accept American Express payments of $5,000 to $2 million for terms of six months, 12 months or 24 months paid back through future receipts. The company charges a one-time fee ranging from 1.75 – 20% of the value of the loan. That’s a key difference between American Express Merchant Finance and a merchant cash advance. In a merchant cash advance, lenders often charge an upfront fee and cut of future receipts. Repayment of the American Express Merchant Finance loan is automatic and debited every day through your receivables or business bank account. There are four methods of repayment, depending upon creditworthiness: Repayment can come from daily American Express receivables; from total receivables; through a transfer account; or through a debit from your business account. There is no penalty for early loan repayment, and depending upon the loan and when you repay, you could get a refund of up to 25% of the initial fee. Loans are secured using business assets excluding real estate and vehicles. For loans $35,000 or less, American Express may require a personal guaranty.

Loan product Loan amount Loan term APR range/ factor rate Fees Time to funding
Term loan $5,000-$2 million 6-24 months 1.75-20% fee, partially refundable for early repayment. No additional fees. Most approved merchants receive funds within 2 days for loans less than or equal to $35,000, 3 days for loans between $35,000 and $250,000, 5 days for loans between $250,000 and $750,000, and 10 days for loans between $750,000 and $2,000,000.

Rates current as of 07/22/2019

Eligibility requirements

Loan product Annual revenue Min. business credit score or personal credit score Time in business
American Express Merchant Finance Minimum of $50,000, with minimum of $12,000 in annual credit and debit receivables. Not specified. At least 24 months.

Additional eligibility factors

Businesses must accept American Express Cards. For 24-month loans, businesses must have accepted American Express for at least 24 months.

Businesses that are not eligible for American Express Merchant Finance loans:

The company says that some types of businesses aren’t eligible, but doesn’t specify which ones. For a complete list, the company’s website tells users to call 1-855-298-1209.

How to apply for American Express Merchant financing

First, review the details involved in the loan. Then apply either online or over the phone. A loan agreement will be sent to you if your loan is approved. Once you’ve signed and returned the loan agreement, funds will be deposited directly into your bank account.

Documents to apply

  • Tax ID or American Express Merchant Account Number
  • Total Annual Credit & Debit Card Receivables
  • Credit card processor name and number
  • Total annual business revenue
  • Total annual personal income
  • Social Security number
  • Date of birth
  • Percentage of ownership
  • Type of business entity
  • Business bank account details (bank name, routing number, account number)


Pros Cons
 A straightforward, largely transparent process for those in need of short-term loans.   As with other short-term lending options, this one can get costly.
 Lower rates than similar products from other lenders.   As long as you have the loan, you’re required to accept American Express payments.
 No fees for paying the loan off early and the possibility of a partial refund of fees paid if you pay your loan back early.   Repayment could cut into cashflow.

Who is the best fit?

Business owners looking for a short-term boost to cashflow or to make a purchase, or hoping to staff up to meet growing demand, who also are confident enough in the growth of their business to commit to paying a percentage of receipts each day, may want to consider merchant financing.

Fine print

Be certain when you apply to get clarification on whether your loan will include a personal guaranty and what form that guaranty will take.

The bottom line: How American Express Merchant Services stacks up

In the world of short-term financing, American Express Merchant Services is quite competitive. However, if you’re looking for something with a longer time horizon, and have the necessary creditworthiness, a more traditional bank loan may be the way to go.