Merchant Cash Advance
A Merchant Cash Advance (MCA) is designed to help business owners manage daily cash flow with flexible repayments.
Instead of a traditional loan, an MCA uses your existing card payment system (such as a card machine or online shop facility) to provide a lump sum of working capital upfront. This advance is then repaid automatically through a small, agreed percentage of your future card sales.
The repayment percentage is set in advance, giving you complete clarity and transparency. The size of your advance is based on your average monthly card turnover, ensuring it matches your business activity.
Service benefits
- Flexible repayments – A fixed percentage is taken from each card transaction, so repayments naturally adjust to your business performance.
- Faster payoff – The more transactions you process, the quicker the advance is paid off.
- Cash flow friendly – If sales slow down, repayments reduce automatically, easing the pressure during quieter periods.
- No fixed collateral – Approval is based on sales, not assets, making it ideal for service businesses, retail, hospitality, and more.
This means your repayment schedule moves in line with your business, not against it. The structure is designed to give you working capital now, without the strain of fixed monthly loan repayments.
How much can my business borrow?
The amount you can borrow is dependent upon your monthly card takings turnover, this is taken as an average over the last six months. The greater the sales turnover that goes through your card machine, the larger amount you can get advanced. Subject to underwriting the funding you could receive via a merchant cash advance could be up to 150% of your monthly card turnover meaning you could receive a larger sum.
How much does the Merchant Cash Advance cost?
The cost to your business is calculated on something that is called a factor rate, this gives you a total repayment figure. When you make a sale and your customer pays by card a percentage of that sale goes to make the repayment of the loan amount until it is paid off in full.
Are merchant cash advances right for my business?
Merchant Cash Advances can deliver a number of benefits for your business. This type of funding allows access to business finance in a shorter time than a high street bank, decision in principle for approval can be made in within just 24 hours. Application processes are quick and simple with a minimal paperwork required. This is due to the lender requesting all the information requested from your merchant provider.
