Business cash advance
A business cash advance gives you a lump sum today in exchange for a fixed amount of future revenue. It is closely related to a merchant cash advance, and the difference is mostly about what the repayment is measured against.
✓ Checking what you qualify for does not affect your credit score.
The two terms are used for the same family of product: a funder pays you a lump sum and you repay a fixed total, called the purchased amount, out of future revenue. In practice “merchant cash advance” usually refers to repayment sized against card sales, while “business cash advance” is the broader label for the same idea when repayment is sized against total business deposits, including ACH, checks and transfers.
That matters because a business that is paid mostly by ACH or check, such as a contractor or a distributor, has little card volume. A funder looking at total deposits can still see the revenue.
This is arithmetic to show the shape of the cost. It is not an offer, and real factor rates depend on the file and the funder.
| Item | Amount |
|---|---|
| Amount received | $50,000 |
| Illustrative factor rate | 1.25 |
| Total to repay (50,000 × 1.25) | $62,500 |
| Cost of the advance (62,500 − 50,000) | $12,500 |
| Repaid over about 6 months (125 business days) | $500 a day, or $2,500 a week |
| Cost as a share of the amount received | 25% |
The cost is fixed at funding, so paying faster does not lower the factor-rate cost unless the agreement says so. Use the factor rate calculator to run your own numbers and read factor rate vs interest rate before comparing it to a loan.
A factor rate is not an APR. Because the total is fixed and the term is short, the equivalent annual rate of a 1.25 advance repaid over six months is far higher than 25%, and a longer repayment lowers it. That is why the honest comparison is total dollars over the same period and, where you can, the equivalent annualised cost.
Short-term needs with a clear payback: inventory ahead of a season, an equipment repair, a payroll gap, a time-limited opportunity. Revenue is steady and deposits are frequent.
Long-term projects, a permanent shortfall, or a business that is already carrying more than one open advance. A line of credit or term loan may price lower.
Three months of bank statements, steady deposits, time in business and the existing-positions picture. See revenue and deposit requirements and existing positions.
Adding another on top of one can strain the account. See MCA refinance, second position and getting out of an advance.
No. It is a purchase of future revenue for a fixed total, collected by debits, not a loan with an interest rate. That is why it is priced with a factor rate.
These advances are generally assessed on revenue and bank activity rather than pledged assets. Terms vary by funder, so read what is being asked of you.
We review your file with a soft credit pull to start. Whether and when a funder pulls hard credit is set by the funder reviewing your file; ask before you accept an offer.
We give a same-day decision on a complete file and funding is typically the next business day after signing.
The minimum FICO is 500. Higher scores open better products and terms. See credit score requirements.
Same-day decision. Applying takes a few minutes and will not affect your credit score.
