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Independent sales organizations may increase their profit potential from cash-advance loans, which merchants pay back using future card receivables, by taking on more of the risk, observers say.
Some cash-advance companies allow an ISO to provide its own cash to merchants to earn a bigger profit, says Curt Hensley, CEO of Impact Payments Recruiting, a Phoenix-based headhunter.
On a cash advance of $10,000, for example, the ISO might contribute half, Hensley says. “You make a much higher percentage of the profit because you take a higher percentage of the risk,” Hensley notes.
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