Glossary
What is Merchant Cash Advance?
A merchant cash advance, or MCA, provides a lump sum in exchange for a portion of the business's future sales. Repayment is collected through a fixed daily or weekly debit or a percentage of card sales until the agreed total is repaid. MCAs are typically priced with a factor rate, can fund quickly, and may accept weaker credit. They are often among the most expensive forms of business financing on an annualized basis, so compare total cost carefully.
Example
A restaurant receives an advance and repays it through daily debits from its bank account over several months.
Related funding
Working Capital: Keep payroll, inventory and operations moving.
Related terms
Questions about an offer? Your advisor will explain every term.