AdvanceMe Continues to Champion Industry Best Practices

Merchant Cash Advance Leader Releases Second White Paper Addressing Risk Assessment

ATLANTA, GA--(Marketwire - April 2, 2008) - AdvanceMe, Inc. (AMI), the nation's leading provider of Merchant Cash Advances for small and mid-sized businesses, announces the upcoming release of the company's next industry white paper entitled "Best Practices for Merchant Cash Advance Providers: Assessment of Risk." This white paper is the second in a series regarding current issues for the Merchant Cash Advance (MCA) industry, specifically the creation of key standards and Best Practices that responsible MCA Providers should follow. This White Paper is intended to start discussion with the goal of creating a strong, positively perceived industry demonstrating a capacity for contained risk, accurately and consistently forecasted growth and returns worthy of investment.

Today's Credit Markets Push Need for Best Practices

In June 2007, AdvanceMe produced an industry-first: a White Paper calling for industry-wide discussion and implementation of Best Practices for providing and servicing Merchant Cash Advances ("Know Your Customer, and Other Guidelines for Responsible Merchant Cash Advance Providers"). The message: A Merchant Cash Advance is a valuable tool that can help small and mid-sized business owners better manage and grow their businesses. However, an MCA can do more harm than good if it is not made responsibly. Therefore, the MCA industry must regulate itself, or someone is likely to do it for us.

Since that time, the media continues to headline stories about the struggling economy, the sub-prime mortgage crisis and the resulting "credit crunch." Traditional financial institutions (such as banks) impacted by losses must minimize future risk by tightening their lending parameters for FICO-based loans to both consumers as well as small business owners. Owners that could once count on financing from a bank (credit cards, home equity loans and lines, business lines of credit, etc.) are finding that access is harder and approval amounts smaller.

As a result, the need for alternative capital products like Merchant Cash Advances continues to grow at a rapid pace. As the economy worsens, applicant "risk/reward" profiles become more negatively skewed as even previously successful businesses are threatened. The potential for MCA portfolio loss is increasing, making it more important than ever for MCA Providers to establish and share Risk Best Practices to ensure their own longevity and the portfolio performance required to guarantee continued access to financing.

Best Practices That Control Risk

The goal of good risk management is the quantification of risk, not its complete avoidance. AdvanceMe's proposal of a Best Practice regime for the MCA industry is not only a call to action to the industry to share insights, but it also urges Individual Providers to employ well thought out risk management processes, including strong underwriting and portfolio monitoring practices that will ultimately impact the achievement of the Provider's desired risk/reward ratios.

Many MCA Providers entered the industry with several misconceptions which set the stage for losses. The underlying mistaken belief was that the MCA industry has wide margins allowing for room for error. As a result, many Providers may have had insufficient capital or poor risk assessment regimes, scoring/underwriting models and asset management processes. Risk management is even more important to MCA Providers than traditional finance companies and banks because responsible MCA Providers do not have any recourse against a merchant who has not breached a contract covenant. The mismanagement of the merchant's business in light of increased competition and economic downturns does not qualify as a breach of one of those covenants.

Among the proposals is the creation of a legally compliant industry "list" which would identify participants in fraudulent behavior in order to screen them preemptively. AdvanceMe is already in discussions with other MCA Providers about sharing data where appropriate. Other suggestions include defining risk/reward targets, identifying and following rigorous underwriting processes, and employing robust and continuous portfolio analysis, asset management techniques and "know your customer" practices.

This is the second White Paper from AdvanceMe, and is intended to be an industry springboard for dialogue that will strengthen Best Practices for the betterment of all. Glenn Goldman, CEO of AdvanceMe, Inc., reinforced the intent behind the White Paper: "Again, we strongly urge everyone with a stake in the future of the MCA industry to contribute to this discussion as a means of creating a strong, positively perceived industry." Goldman continues, "Our goal is to demonstrate for the industry, and its financiers, a capacity for anticipated risk, accurately and consistently forecasted growth and returns worthy of investment. The promotion of Best Practices that assess risk while providing responsible funding will help customers, ISOs that sell the product and the industry as a whole."

An electronic version of both the White Paper as well as this document can found on AdvanceMe's website at and or by emailing beginning April 2, 2008.

About AdvanceMe, Inc.

AdvanceMe, Inc. in Kennesaw, GA is the nation's premier provider of Merchant Cash Advances to small and mid-sized businesses. Since 1998, AdvanceMe has made almost 40,000 fundings, providing more than 20,000 business owners in all 50 states with 1 billion dollars in working capital. Owners use AdvanceMe capital to renovate, purchase new equipment and supplies, fund advertising, manage unexpected expenses and seasonal downturns and free themselves from second mortgage liens and personal guarantees associated with loans. For more information about AdvanceMe's innovative working capital solution, call toll-free 1-866-838-5097 or visit

Contact Information: Contact: Lauren Shankman Trevelino/Keller Communication Group 404-214-0722 x110