Merchant Cash Advance (MCA)
No equity dilution
Ownership stays yours
Payments scale
Payments rise & fall with revenue
Fast decisions
Very fast access to capital
How It Works
How It Works
How It Works
Merchant Cash Advance (MCA) turns a slice of your future sales into cash you can use today—without equity dilution or fixed amortization. Approval focuses on recent revenue patterns (bank and merchant/POS statements), time in business, and industry, not just traditional credit metrics. Funds are typically deposited within 24–48 hours, and repayments “scale with sales” through a fixed holdback percentage taken daily or weekly. On slower days you remit less; on stronger days, more. Many programs also offer reconciliation (“true-ups”) to keep payments aligned with actual cash flow.
MCAs are best for businesses with steady card or deposit volume that need fast, flexible working capital—for inventory buys, seasonal promotions, hiring, repairs, or marketing. Typical advance sizes range from ~$5,000 to $500,000+ with estimated terms from 3–12 months, depending on sales velocity. Pricing uses a factor rate (e.g., 1.20) rather than APR: total payback equals the advance amount multiplied by the factor, remitted over time via your holdback. Renewals may be available once a portion is repaid and performance remains strong; some programs offer early-payoff discounts.
What to expect: MCAs are generally unsecured (a UCC filing or personal guarantee may apply) and require light documentation—government ID, a voided business check, last 3–6 months of bank statements, and, if applicable, 3–6 months of merchant/POS statements. Advantages include very fast funding, flexible use of proceeds, and payments that move with your revenue. Considerations include higher total cost versus traditional loans and the operational impact of daily/weekly debits if sales slow. To decide if an MCA fits, compare total payback across offers, model the holdback against your margins, and use the capital for short-term, revenue-generating needs.
⇒ Pros: very fast access to capital; payments scale with sales—no fixed amortization; generally unsecured; limited documentation vs. bank loans; and flexible use of funds (inventory, payroll, ads, repairs).
⇒ Cons: higher total cost than traditional loans; daily/weekly debits can strain cash flow if sales slow; not designed for long-term assets or multi-year projects; and may include a personal guarantee or UCC filing.
Ready to explore options? Start a quick application and we’ll match you with MCA programs tailored to your sales pattern and seasonality, with clear terms and guidance on managing cash-flow impact—and a path to lower-cost products as you grow. Apply for a merchant cash advance (MCA) now!
Compare at a glance
| Funding Option | Flexibility | Speed | Typical Cost |
|---|---|---|---|
| Merchant Cash Advance | Medium (revenue-based) | Very Fast | Medium–High |
| Line of Credit | High (revolving) | Fast | Low–Medium |
| Term Loan | Medium (fixed) | Medium | Low–Medium |
Compare at a glance
| Funding Option | Flexibility | Speed | Typical Cost |
|---|---|---|---|
| Merchant Cash Advance | Medium (revenue-based) | Very Fast | Medium–High |
| Line of Credit | High (revolving) | Fast | Low–Medium |
| Term Loan | Medium (fixed) | Medium | Low–Medium |
It’s an upfront lump sum in exchange for a fixed percentage (“holdback”) of your future sales until a set total payback (factor/multiple) is reached.
An MCA isn’t a loan with interest and amortization; it’s a purchase of receivables with variable, revenue-linked remittances and a fixed total payback.
Factor rate (e.g., 1.35) sets the total you’ll repay (funded × factor). Holdback is the % of sales remitted (e.g., 8%–15%) until you hit that total.
Either via daily/weekly ACH debits (with periodic “true-ups”) or a processor split that diverts the holdback % from your card batches automatically.
Approvals can be same day with basic docs: application, IDs, 3–6 months of bank/processor statements, and a voided check.
Typically 3–12+ months in business, consistent monthly revenue/deposits, limited NSFs, and stable average balances. Personal credit matters but revenue health matters more.
Remittances rise when sales rise and fall when sales dip. Ensure the holdback fits your margins and seasonality so you can cover COGS and operating expenses.
Some funders offer early-pay discounts, but many require the remaining balance up to the factor—confirm the payoff policy in writing.
High total cost, stacking multiple positions, weak/absent reconciliation language, aggressive remedies (e.g., COJ clauses), and hidden fees. Read the contract carefully.
Short-term term loans (fixed payments), business lines of credit (revolving, often cheaper), revenue-based financing (broader revenue definition, capped payback), or invoice/equipment financing depending on your use case.
It’s an upfront lump sum in exchange for a fixed percentage (“holdback”) of your future sales until a set total payback (factor/multiple) is reached.
An MCA isn’t a loan with interest and amortization; it’s a purchase of receivables with variable, revenue-linked remittances and a fixed total payback.
Factor rate (e.g., 1.35) sets the total you’ll repay (funded × factor). Holdback is the % of sales remitted (e.g., 8%–15%) until you hit that total.
Either via daily/weekly ACH debits (with periodic “true-ups”) or a processor split that diverts the holdback % from your card batches automatically.
Approvals can be same day with basic docs: application, IDs, 3–6 months of bank/processor statements, and a voided check.
Typically 3–12+ months in business, consistent monthly revenue/deposits, limited NSFs, and stable average balances. Personal credit matters but revenue health matters more.
Remittances rise when sales rise and fall when sales dip. Ensure the holdback fits your margins and seasonality so you can cover COGS and operating expenses.
Some funders offer early-pay discounts, but many require the remaining balance up to the factor—confirm the payoff policy in writing.
High total cost, stacking multiple positions, weak/absent reconciliation language, aggressive remedies (e.g., COJ clauses), and hidden fees. Read the contract carefully.
Short-term term loans (fixed payments), business lines of credit (revolving, often cheaper), revenue-based financing (broader revenue definition, capped payback), or invoice/equipment financing depending on your use case.
Frequently Asked Questions
It’s an upfront lump sum in exchange for a fixed percentage (“holdback”) of your future sales until a set total payback (factor/multiple) is reached.
An MCA isn’t a loan with interest and amortization; it’s a purchase of receivables with variable, revenue-linked remittances and a fixed total payback.
Factor rate (e.g., 1.35) sets the total you’ll repay (funded × factor). Holdback is the % of sales remitted (e.g., 8%–15%) until you hit that total.
Either via daily/weekly ACH debits (with periodic “true-ups”) or a processor split that diverts the holdback % from your card batches automatically.
Approvals can be same day with basic docs: application, IDs, 3–6 months of bank/processor statements, and a voided check.
Typically 3–12+ months in business, consistent monthly revenue/deposits, limited NSFs, and stable average balances. Personal credit matters but revenue health matters more.
Remittances rise when sales rise and fall when sales dip. Ensure the holdback fits your margins and seasonality so you can cover COGS and operating expenses.
Some funders offer early-pay discounts, but many require the remaining balance up to the factor—confirm the payoff policy in writing.
High total cost, stacking multiple positions, weak/absent reconciliation language, aggressive remedies (e.g., COJ clauses), and hidden fees. Read the contract carefully.
Short-term term loans (fixed payments), business lines of credit (revolving, often cheaper), revenue-based financing (broader revenue definition, capped payback), or invoice/equipment financing depending on your use case.
Kredline’s merchant cash advance gave us fast capital without a fixed monthly payment. Funding hit in days, and the holdback came off daily card sales, so repayments rose and fell with revenue. Terms were clear, the split was easy to track, and it bridged our inventory crunch ahead of a big promo. Exactly what we needed, right on time.
Lena P. – Owner/Operator @ BrightSide Nail Studio
Kredline’s merchant cash advance gave us fast capital without a fixed monthly payment. Funding hit in days, and the holdback came off daily card sales, so repayments rose and fell with revenue. Terms were clear, the split was easy to track, and it bridged our inventory crunch ahead of a big promo. Exactly what we needed, right on time.
Lena P. – Owner/Operator @ BrightSide Nail Studio
Kredline’s merchant cash advance gave us fast capital without a fixed monthly payment. Funding hit in days, and the holdback came off daily card sales, so repayments rose and fell with revenue. Terms were clear, the split was easy to track, and it bridged our inventory crunch ahead of a big promo. Exactly what we needed, right on time.
Lena P. – Owner/Operator @ BrightSide Nail Studio
