I agree with S Dean I think. If a small operator was trying to bridge a cash flow gap, say Jan - Mar (after some unexpected expense) and then chunk it back in show season it really does not seem to be bad business to me. Obviously show artist should plan ahead for whatever their slow/no show period is going to be but life sometimes does not cooperate with good plans and the business may be in otherwise perfectly fine condition. This rate in that situation would be pretty competitive and would likely be better than using credit cards. A bank line of credit other than against your home may not even be an option. These days a lot of home owners don't even have equity available for a LOC against it with so many still upside down.
Square tossing a 'fairly low cost for what it is' loan program in the mix I don't think is predatory and just because someone needs a short term loan does not mean they are not doing fine with their budgeting. I have had unexpected expenses that are waay more than I would have planned for. Get a couple big unexpected expenses and anyone might have to scramble to patch a cash hole. Higher priced credit is not by definition bad.
note: I'm also showing my age by admitting that those rates for a business loan with no collateral just don't seem that high to me. Fifteen years ago those would have actually been pretty good rates for a secured business loan to most small businesses. But times have changed.
- S. Dean likes this