The Green Sheet Online Edition
December 12, 2016 • Issue 16:12:01
Residual-based loans, financing solutions for ISOs
Super G Funding, based in Newport Beach, Calif., is a national provider of alternative finance solutions. Founded in 2008 by seasoned entrepreneur and former ISO owner Darrin Ginsberg, the company assists business owners across multiple industries through all stages of growth. Loan products range from $100,000 to $5 million.
An active lender in the merchant services space, Super G provides tailored financing to ISOs, merchant service providers and acquirers. Its customized lending solutions enable borrowers to leverage recurring revenue streams while holding on to their hard-earned merchant portfolios, the company noted.
"There are numerous reasons why ISOs need money," Ginsberg said. "Whether they want to acquire a portfolio, invest in equipment or buy out a partner, we can help them finance, using their own portfolios as collateral with hardly any money down."
Timely strategic resource
Ginsberg founded Super G during a particularly challenging time for the payments industry. Many ISOs and merchant level salespeople (MLSs) were selling portfolios at a loss due to widespread attrition and economic hardships. Super G Funding's alternative financing was well received by the ISO community, because it enabled ISOs to borrow against existing portfolios without being forced to sell short on their portfolio income, Ginsberg said.
The company's initial success fueled its growth and diversification into additional key vertical industries. It funded more than 400 ISOs across the United States between 2008 and 2015 and formed strategic partnerships with Harbortouch Payments LLC, Cynergy Data LLC and other major ISOs. Super G Funding alliance partners have subsequently rolled out finance programs to their sub-ISOs, agents and channels, according to Ginsberg.
Fast approvals, competitive rates
Unlike traditional financial institutions, which can take up to six months to approve loans, Super G can arrange funding at competitive rates in three to five business days to ISOs processing a minimum of $5,000 in monthly residual income. Qualifying ISOs can receive up to five times their monthly residual. Loan amounts are negotiable but typically range from $25,000 to $1 million, the company stated.
ISOs and MLSs affiliated with an approved processor can obtain financing from Super G by temporarily assigning their residuals until the loan is repaid. Repayment terms include 12, 24, 36 and 48 months; fixed monthly payments are deducted from residuals and can be tracked online and in monthly reports.
Multiple benefits, use cases
Funds received from Super G loans are generally not taxable, but borrowers can deduct loan interest as a qualified business expense. ISOs have used Super G loans to add value to their portfolios, acquire new portfolios, and improve their revenue streams, Ginsberg noted.
Following are several examples Super G provided of how ISOs can leverage its financing solutions:
- Buy back residuals from sub-ISOs and agents to increase your monthly residual, effectively making more money without doing additional work.
- Invest in a new building or upgrade existing real estate or technology infrastructure.
- Acquire a new merchant portfolio, ISO or distribution channel.
- Place a high-volume equipment order to improve margins by obtaining a low per-unit price.
- Invest in human resources by hiring salespeople, staff and contract labor.
Launch an advertising or marketing campaign.
- Buy out an inactive or retired partner or investor.
Super G works closely with ISOs and acquirers, from initial funding through execution, on a range of customized finance solutions. "ISOs can use the money for whatever purpose they want," Ginsberg said. "After years of organically building several ISOs and both purchasing and selling ISOs and portfolios, I wanted to tailor solutions for ISOs that enabled them to continue to own their book of business and yet give them some liquidity or growth capital for the business."
Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.