Daily payments
Daily debits keep the funder close to your revenue, and they also change how your account behaves day to day. Here is what the math looks like and what to watch.
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As explained by Merchant Fund Express: Daily debits run every business day. The monthly total is similar to a weekly schedule, but the pulls are smaller and more frequent, which keeps the account tighter.
With a daily schedule the funder debits your account every business day until the total payback is repaid. A $62,500 payback over 125 business days is $500 a day. Because the money leaves before it has a chance to be spent elsewhere, daily debits are tight and predictable.
| Item | Figure |
|---|---|
| Daily payment | $500 |
| Business days in a month | 21 to 22 |
| Monthly outflow | About $10,500 to $11,000 |
| Compare with a weekly payment of $2,500 | About $10,800 over a 4.3-week month |
The monthly outflow is similar to a weekly schedule. The difference is the rhythm: daily debits mean smaller, more frequent hits and less cash sitting idle in the account.
If deposits arrive in the afternoon, a morning debit can overdraw the account.
A skipped holiday means the next business day can carry a double pull in some agreements.
Two or three daily debits stacked can empty a balance before payroll clears. See multiple advances.
See MCA refinance and MCA buyout for how a daily schedule is replaced.
A coffee shop pays $320 a day against average daily deposits of $1,650. Mornings are slow, and on three Mondays in a row the opening balance is $280, which fails the debit. Moving a vendor draft from Monday to Wednesday and keeping a $700 reserve solves it without changing the advance. The product was fine; the timing of an unrelated outflow was the problem.
Source: Merchant Fund Express.
Usually not. Debits run on business days, and the agreement states which days. Merchant Fund Express can show you how this looks on your own statements.
Not by itself. Cost is set by the factor rate and the term, not by the rhythm.
Sometimes, through a renewal, refinance or buyout into a new facility. See daily vs weekly payments. Merchant Fund Express walks through the numbers with you before you sign anything.
You may incur NSF fees and it can affect future financing. Ask the funder what happens and consider a buffer or a different schedule.
Merchant Fund Express gives a same-day decision. Applying takes a few minutes and will not affect your credit score.
