Steps to Apply:
1
Quick Application:
Complete our simple online form and receive swift approvals.
2
Explore Choices:
Compare various options to find the ideal solution for your needs.
3
Personalize Your Terms:
​Choose the options that best suit your business objectives.
4
Get Funding:
Access funds within a few business days for most programs.
Merchant Cash Advance Loans & Financing Solutions
Explore flexible Merchant Cash Advance Loans and financing solutions with Merchant Pro Funding. Access fast, hassle-free funding to support your business growth and manage cash flow effectively.
Merchant Cash Advance Loans
& Other Financing Option
If you're a small business owner who needs quick access to capital, a Merchant Cash Advance (MCA) could be the solution. Also referred to as a Business Cash Advance or MCA Loan, this type of financing provides easily accessible capital with flexible repayment terms. Typical requirements like excellent credit scores or extensive financial statements aren't mandatory for merchant cash advance eligibility.
Payment amounts for a merchant cash advance are based on daily credit card sales and are not fixed, allowing businesses to pay according to their cash flow. A merchant cash advance remains flexible, even if sales slow temporarily. This makes it an ideal option for businesses that struggle with the fixed payment schedules of traditional loans.
In this guide, we will answer the following questions and more:
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What Is a Merchant
Cash Advance?
A Merchant Cash Advance (MCA), also known as a "Business Cash Advance" or "Credit Card Factoring," provides a lump sum payment to a business. The advance is repaid through a fixed percentage of future daily credit card sales, known as the "holdback rate."
Unlike traditional loans, a merchant cash advance is easier to qualify for. Businesses with limited collateral, low credit scores, or limited business credit history may benefit from this option. The amount of financing you qualify for depends on future credit card receivables or sales made to customers via credit card payments.
Max Funding Amount:
$5K - $1M
Factor Rates:
Starting at 1-6% per month
Term:
3-24 months
Speed:
1-2 business days
The size of your borrowing amount and terms depend primarily on your monthly credit card sales volume. Strong sales typically outweigh poor credit when qualifying for a merchant cash advance. Borrowers are assigned a Factor Rate instead of a traditional interest rate, which determines the total repayment amount. Factor rates range from 1.09 to 1.5.
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Example of a Merchant Cash Advance:
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If you borrow $50,000 with a factor rate of 1.4, you will repay $70,000 in total. With a holdback rate of 10%, daily payments will adjust based on sales:
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Month 1: $100,000 in card transactions results in $333 daily payments, totaling $10,000 for the month.
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Month 2: $70,000 in card transactions results in $233 daily payments, totaling $7,000 for the month.
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Repayment aligns with sales, ensuring no excessive financial burden during slower periods.
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Merchant Cash Advance on Future Credit Card Sales – Research, Facts & Reports
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Highest Approval Rates: Merchant cash advances had a 90% approval rate in 2023, up from 84% in 2020. (Source: 2023 Small Business Credit Survey)
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Market Growth: The global merchant cash advance market is projected to reach $26.3 billion by 2029. (Source: Adroit Merchant Cash Advance Market Report)
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Cash Flow Issues: Approximately 82% of small businesses fail due to cash flow problems. (Source: National Federation of Independent Businesses)​​​
How Does a Merchant Cash Advance Work?
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Flexible Repayment: Payments adjust based on daily sales, making it ideal for seasonal businesses.
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Quick Access: Approval and funding can happen within 1-2 business days.
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Loose Requirements: Subpar credit scores, limited business history, or cash flow problems won't necessarily disqualify you.
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Versatile Use: Funds can be used for various business purposes, from payroll to inventory replenishment.
What Are the Advantages of a Merchant Cash Advance?
What Are the Disadvantages of a Merchant Cash Advance?
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Higher Costs: MCAs are among the most expensive financing options due to loose requirements and higher risks for lenders.
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Cash Flow Pressure: Large or frequent payments could strain your operating capital.
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​No Early Payoff Benefit: Unlike traditional loans, repaying early does not reduce the total repayment amount.
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Merchant Cash Advance Compared to Other Products:
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Loan Types
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Max Amounts
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Rates
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Speed
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Merchant Cash
Advances
$7.5K - $1M
​Starting at 1-6% p/mo
1-2 business days
Receivables/Invoice Financing
$10K - $10M
Starting at 1% p/mo
1-2 week
SBA Loan
​
$50K - $10M
Starting at Prime + 2.75%
8-12 weeks
Equipment
Financing
Up to $5M per piece Starting at 3.5% (SBA)
3-10+ business days
Business
Term Loan:
$10K - $5M
Starting at 1-4% p/mo
1-3 business days
Revenue-Based Business Loans
$10K - $5M
Starting at 1-6% p/mo
1-2 business days
Business
Line of Credit
$1K - $250K
Starting at 1% p/mo
1-3 business days
Approved businesses generally meet the following criteria:​
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Annual Revenue: $120K+
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Credit Score: 550+
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Time in Business: 4 months+
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Who Qualifies for a Merchant Cash Advance?
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Step 1: Consider Your Needs Ensure an MCA aligns with your financial goals and repayment capabilities. Assess how much funding you need and how repayment will impact cash flow. ​
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Step 2: Gather Your Documents Prepare the following:
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U.S. driver's license​​
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Voided business check
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Business bank account statements (past 3 months)
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Credit card processing statements (past 3 months)
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Step 3: Complete Application Fill out a one-page online application or call to speak with a representative. Provide necessary details and your desired funding amount.
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Step 4: Speak to a Representative A representative will review repayment structures, rates, and terms to ensure transparency and avoid hidden fees.
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Step 5: Receive Approval Once approved, funds are deposited into your account within 1-2 business days.
How to Apply for a Merchant Cash Advance
If your application is declined, the issue may be cash flow or account-related. In such cases, alternative products like accounts receivable factoring, equipment loans, or working capital loans may be recommended.
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Other options include:
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Business Credit Cards: Easier to qualify for and build credit history.
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Credit Repair Services: Improve personal and business credit scores to expand future options.
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Consult Local Credit Unions: Explore additional funding opportunities.
What If I'm Declined for a Merchant Cash Advance?
Conclusion
​Merchant Cash Advances provide fast, flexible financing for small businesses that may not qualify for traditional loans. While they come with higher costs, their accessibility and adaptability make them a valuable tool for managing cash flow and supporting growth. By understanding the terms and repayment structure, business owners can make informed decisions to ensure their MCA works to their advantage.
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