Understanding Coastal Payment Systems Commercial Lending Solutions

mfindeisen6
Oct 17
5 min read

Updated: Oct 29

Before diving into Coastal Payment Systems commercial lending products, it’s important to understand the company behind them:

CPS is primarily a merchant services provider. They help businesses with point-of-sale systems, payment processing, terminals, and related technology.
CPS has expanded into business funding. They offer lending solutions through a network of partner lenders.
They emphasize quick approvals, transparent terms, and flexibility in structuring. Business Loans & Financing | Coastal Payment Systems

CPS is not a traditional bank. Instead, their role tends to be that of a loan broker or facilitator. They connect businesses to lenders.

Types of Commercial Loans Offered by CPS

Here’s a survey of the types of commercial/business financing CPS offers or helps arrange.

Loan Type	Description / Use Cases	Collateral & Structure	Sample Terms / Notes
Working Capital Loans	For day-to-day expenses, bridging cash flow shortfalls, paying vendors, covering payroll, etc.	May be unsecured or secured (e.g. tied to receivables or inventory)	CPS highlights fast approvals and simple terms. coastalpaymentsystems.com
Equipment Financing	To acquire machinery, hardware, or tech (e.g. POS systems or other tools)	The equipment itself often serves as collateral	You make payments over a term; sometimes lower interest since collateral is involved.
Term Loans	Lump sum financing with fixed repayment schedule for growth, expansion, acquisition, etc.	Often secured by business assets, receivables, or blanket liens	CPS states they can refinance short-term debt into longer 10-year term loans in some cases. coastalpaymentsystems.com
Accounts Receivable / Invoice Financing	Borrowing against receivables or invoices you’ve issued	Collateral = accounts receivable	This provides immediate liquidity based on your outstanding invoices. CPS mentions secured lending “against accounts receivable, real estate, purchase orders, inventory, contract rights, etc.” coastalpaymentsystems.com
Lines of Credit	Revolving access to capital for fluctuating needs	May be secured or unsecured, backed by assets like AR or inventory	CPS and partner lenders reportedly support business lines of credit.
Debt Refinancing / Consolidation Loans	Rolling multiple existing loans into one, often with better rates or longer terms	May require collateral or a clean credit profile	CPS describes a “true consolidation loan” product in their blog, used to reduce monthly payments by paying off other lenders and combining into one term loan. coastalpaymentsystems.com
SBA / Government-Backed Loans & Mortgages	CPS claims to assist clients in applying for SBA (7(a), 504) and commercial/residential mortgages.	These often require stricter credit, business history, and collateral	CPS acts as a consultant or broker to help you access these programs.

CPS has access to a network of over 250 registered lenders across the U.S. This allows them to match your business with one or more potentially favorable lending offers.

Advantages and Challenges of CPS’s Commercial Loans

Advantages

One-Stop Shop
CPS already works with businesses on payment processing and POS infrastructure. Clients can consolidate vendor relationships, possibly bundling payments and financing arrangements.
Speed & Ease
CPS emphasizes “fast approvals, simple terms, transparent rates.” Their role as a facilitator means less friction and potentially quicker access to capital than some banks.
Flexibility in Collateral
CPS notes that their partners provide secured lending based on a variety of assets — accounts receivable, inventory, purchase orders, real estate, contract rights, etc. This enables more businesses to qualify even if they don’t own real estate.
Consolidation / Debt Rescue Options
Their “true consolidation loan” product is aimed at businesses burdened by high short-term debt. It enables consolidation into one lower-payment structure.
Broker Network & Choice
Because CPS is not solely tied to one lender, you may receive competing offers from multiple lenders via their network.

Challenges to Consider

Potentially Higher Cost
Third-party lenders may carry higher risk. Interest rates can be higher than what you’d find at a traditional bank, especially for unsecured or short-term loans. Always compare APRs, fees, and amortization schedules.
Transparency of Fees & Terms
While CPS claims transparent rates, borrowers should scrutinize all fees, especially in facilitated or brokered deals.
Credit & Time in Business Requirements
Better deals go to businesses with strong credit, proven revenue history, sound financials, and solid collateral. Some clients, especially startups, may not qualify for the lowest rates or most favorable terms.
Dependence on Lender Network Quality
The quality of your actual loan depends heavily on the lender you are matched with. Even if CPS’s process is smooth, if the lender is aggressive or inflexible, it might create challenges.
Due Diligence & Documentation
Borrowers should be prepared to provide financial statements, tax returns, cash flow projections, balance sheets, and documentation on collateral. Because CPS facilitates many deals, the administrative burden may shift more to you.

Evaluating CPS’s Commercial Loan Options

When considering a commercial loan via CPS, keep the following steps in mind:

Clarify Your Purpose & Amount Needed
What exactly do you need capital for (e.g., new equipment, expansion, payroll)? Be precise with your ask.
Assess Your Financials
Ensure your books, tax returns, cash flow statements, and projections are in order. Lenders will scrutinize these.
Get Multiple Offers
Use CPS’s network (or bypass it) to compare 3–5 offers. Compare interest rates, effective APR (including all fees), term lengths, and prepayment terms.
Check Collateral Requirements
Ask what collateral is needed (AR, inventory, equipment, real estate). Ensure you understand what assets are at risk.
Run Projections
Ensure the payments fit your projected cash flows. Don’t overextend.
Ask About Hidden Costs / Penalties
Clarify origination fees, closing fees, late payment fees, prepayment penalties, and any balloon payments.
Understand Default Terms
Know what triggers default (missed payments, covenant breaches, financial ratios) and what the consequences are.
Negotiate Terms Where Possible
Request more favorable amortization, longer terms, or lower rates based on your strengths or collateral.

Example Use Cases

Here are a few hypothetical examples to illustrate how businesses might use their loans:

A mid-sized distributor with $700,000 in monthly revenue obtains a 5-year low-cost term loan / AR facility from CPS’s lending partners, using accounts receivable as collateral. Business Loans & Financing | Coastal Payment Systems
A business with multiple short-term loans consolidates them via CPS’s "true consolidation loan" product, turning fragmented high-interest obligations into one 10-year term loan, drastically lowering monthly payments (in some cases by up to 80%). coastalpaymentsystems.com
A trucking company with steady revenues of $600,000 gets a term loan with 5-year amortization but a balloon payment due in month 36, structured to match their cash flow cycles. coastalpaymentsystems.com

These examples illustrate how CPS’s network approach can tailor deals to the needs of different industries.

Final Thoughts and Recommendations

Commercial loans via Coastal Payment Systems can be a useful option, especially if:

You already use CPS for payments and want to keep financial relationships consolidated.
You need speed, flexibility, and access to multiple lender options.
You have assets (receivables, equipment, inventory) you can use as collateral.
You’re seeking consolidation, capital for growth, or bridging capital.

However, you should not accept the first offer blindly. Always vet terms, compare to traditional bank loans or SBA options, and run realistic projections to ensure you can afford repayment.

Ready to get started with your loan application? Start Here