Forward Financing Review: Confusing Cash Advances

Forward Financing’s confusing requirements and a lack of pricing information concern us.

  • Check
    Low borrower requirements
  • Check
    Same- and next-day funding
  • X
    Expensive fees
  • X
    Little information on website

Forward Financing offers small-business funding in the form of merchant cash advances. Like many online lenders, it promises a fast application and fast funding. As an added bonus, it has flexible borrower requirements.

That said, Forward Financing isn’t all sunshine and roses. It has some definite downsides (like the cost).

So should you get working capital from Forward Financing? We’ll explain the good, the bad, and the confusing to help you decide.

We don’t love Forward Financing (but its customers do)

Pros
Pro Bullet Low credit and revenue requirements
Pro Bullet Same- and next-day funding
Pro Bullet Positive customer reviews
Cons
Con Bullet Expensive fees
Con Bullet Merchant cash advances only
Con Bullet Lack of information on website

We’re a little skeptical of Forward Financing―which we didn’t expect when we started our research, since Forward Financing has great customer reviews (we’ll come to those later).

Part of our skepticism comes from how cagey Forward Financing is about the funding it offers. It calls its product “revenue-based financing,” which is just a nice way of saying it’s a merchant cash advance. You know―one of the most expensive and confusing types of small-business financing out there?

So we don’t appreciate Forward Financing making things more confusing by refusing to call a spade a spade (or, in this case, calling an MCA an MCA). Plus, Forward Financing doesn’t list any pricing information on its website. That’s a big red flag for us, since it usually means the costs are too scary to advertise.

The actual straw that broke the camel’s back? Trying to figure out Forward Financing’s borrower requirements.

Qualifying for Forward Financing

Min. credit score
Min. revenue
Min. time in business
Get a loan
N/A$5,000/mo.Unclear

On the one hand, Forward Financing doesn’t have a minimum credit score requirement (though it does look at your personal credit score. That’s great! Plus, its $5,000 monthly revenue requirement ($60,000 per year) is pretty low. Great also!

The confusion set in when we look at the time in business requirement. At first we saw three months―a super low requirement. But then somewhere else on the website it said one year. That’s pretty standard for online lenders. But which was right?

Our attempt to get answers

We called to find out and got connected with a customer service representative right away. We asked what the minimum time in business requirement was. The rep had no idea what we were asking.

We rephrased, and asked if the three-month requirement or one-year requirement was correct. The rep still seemed confused, and then asked if we were a broker or a merchant. (We had already gone through the menus and pressed the number saying we were a business applying for funding.) The rep said they’d have to put us on hold.

When they returned, they started asking for personal information―like our name and our business’s name.

We gave up at that point. Because, to be clear, this is the kind of question we’ve asked tons of lenders over the years. They don’t usually ask for identifying information before answering a very, very basic question about their loans.

As a last attempt to figure out the time in business requirement, we started Forward Financing’s online application process. And sure enough, it asks for your business start date right away. Except you can’t choose anything newer than 2016―which would be four years in business (a stricter requirement than even traditional banks have).

Our take

So what is Forward Financing’s actual time in business requirement? We have no idea. It could be as little as three months, or it could be as much as four years (or somewhere in between).

All we know is that Forward Financing doesn’t provide enough information on its website (about pricing or borrower requirements), and we're not too impressed with its customer service either. That’s enough to keep us from recommending Forward Financing.

Instead, we suggest you look at a Fundbox line of credit. It has very low borrower requirements, and it’s not a merchant cash advance. Plus, we’ve found it much easier to get answers from Fundbox.

But like we mentioned above, Forward Financing has―much to our surprise―pretty positive reviews. If that’s enough to keep you interested, let’s talk more about what Forward Financing can offer you, funding-wise.

Forward Financing loan options

Forward Financing offers only revenue-based financing―which, as we said, is just a merchant cash advance.

That means that your payments will be a percentage of your revenue. Interestingly, though, Forward Financing says it takes payments from your business bank account. (Most MCA companies take their cut directly from your credit card sales.) You can end up with either a daily or weekly payment schedule.

One good thing about Forward Financing’s advances? The speed. You can get approved the same day you apply. You may even be able to get your money the same day (though you’ll have to pay an extra wire transfer fee to do so ). Otherwise, you’ll get your advance the next business day.

Forward Financing financing

Product
Min./max. loan size
Lowest listed rate
Repayment terms
Get a loan
Merchant cash advance$5,000/$300,000Unlisted4–12 mos.

As we mentioned earlier, Forward Financing offers absolutely no pricing information. Merchant cash advances come with a flat fee, rather than interest. (This is why MCAs don’t count as small-business loans, though they are a type of working capital.) And according to reviews we saw, Forward Financing’s fee ranges from 35% to 97% of your advance. That’s pricey―but that’s what you get from merchant cash advances.

Forward Financing’s website does note that “in some instances” you can get a discount on your fee for early repayment, but it offers no other information about how that works. We wouldn’t count on that discount. (But at least you won’t have to worry about prepayment penalties if you pay off your advance early.)

If you end up liking Forward Financing, you may be able to get another loan once you’ve paid off 60% to 80% of your advance. We recommend you don’t do this (merchant cash advances are known for causing debt spirals), but you do have that option.

That pretty much sums up Forward Financing’s advance. As you can see, we’re not too impressed. But Forward Financing customers see things a little differently.

Forward Financing customer reviews

As we’ve noted a couple times now, Forward Financing has mostly positive reviews. It has a 4.8 out of 5 on Trustpilot, or an “excellent” rating.1

The positive reviews praise how easy Forward Financing’s application is. Customers also like the fast approval and funding times. (One business owner even reports getting funding just 12 hours after applying.) Many borrowers also say that Forward Financing has good customer service, with helpful reps who answered all their questions.

The negative reviews largely talk about the high costs of funding. Some borrowers also complain they didn’t understand how Forward Financing’s advance model actually worked before applying (not surprising, given its website). We also saw a couple negative reviews that say Forward Financing hasn’t been understanding to businesses affected by the COVID-19 pandemic.

For what it’s worth, Forward Financing responds to just about every review.

Best Small-Business Loans
Lendio
Best overall
4.3 out of 5 stars
4.3
Fundbox
Best for low credit
3.6 out of 5 stars
3.6
Fundera
Best for SBA microloans
3.9 out of 5 stars
3.9
BlueVine
Best for larger loans
4 out of 5 stars
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Funding Circle
Best for P2P lending
2.9 out of 5 stars
2.9
Learn more about our top brands.

The takeaway

Forward Financing can help your company with its cash flow needs―but make sure you understand its pros and cons before you apply. 

Forward Financing has great customer reviews and offers fast funding times. But it also charges very high fees, and it doesn’t provide enough upfront information about its cash advances.

Those cons keep Forward Financing from ranking as one of our favorite lenders. If you decide to fund your business through Forward Financing anyway, we simply urge you to borrow carefully and make sure you understand what you’re committing to.

Compare Forward Financing to other lenders with our rankings of the best working capital loans.

Disclaimer

At Business.org, our research is meant to offer general product and service recommendations. We don't guarantee that our suggestions will work best for each individual or business, so consider your unique needs when choosing products and services.

Sources

  1. Trustpilot, “Forward Financing” Accessed November 23, 2020.
Chloe Goodshore
Written by
Chloe Goodshore
Chloe covers business financing and loans for Business.org. She has worked with many small businesses over the past 10 years, from video game stores to law firms. Those years watching frustrated business owners try to sift through their many options gave her a passion for breaking down complex business topics. She wants to help business owners spend less time agonizing over their businesses so they can spend more time running them.
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