The shadowy world of merchant cash advances

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• 00:00

  N-P-R This is the indicator from Planet Money.

• 00:14

  I'm Weilin Wang, and we have NPR business correspondent Alina Seljuk back with us today.

• 00:19

  Hello, hello.

• 00:20

  Always great to see you.

• 00:21

  And Alina, you've taken a field trip recently into a particular corner of the financial world.

• 00:27

  It's a pretty shadowy corner.

• 00:29

  It's an industry that offers very fast cash for very high fees to businesses in distress.

• 00:36

  Your file shows you're nearly approved for $159,000.

• 00:40

  OK, that does not sound real, but it sure does sound like a nice chunk of cash I could use.

• 00:46

  The thing is, these can be real.

• 00:49

  Real money from real lenders who are largely unregulated.

• 00:53

  During the pandemic, these firms went after struggling restaurants and music venues.

• 00:58

  Now they found a new market of small businesses that desperately need cash to pay tariffs.

• 01:04

  Today on the show, the story of a financial lifeline that can turn into a financial chokehold.

• 01:10

  And how one business owner went from a year that was slated to be his best to a year of owing a fortune to lenders that took their money straight from his bank account.

• 01:21

  I'm a million dollars in debt with merchant cash advance loans right now.

• 01:25

  That's coming up after the break.

• 01:30

  This message comes from Wwise, the app for international people using money around the globe.

• 01:35

  You can send, spend, and receive in up to 40 currencies with only a few simple taps.

• 01:41

  Be smart.

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