Merchant Cash Advance is a fast and easy alternative to a traditional bank loan. We advance you funds, then take a fixed percentage (Retrieval Rate) of your daily credit and debit card transactions until the account is settled.
What is "Merchant Cash Advance"? A Merchant Cash Advance (MCA) is the purchase of future credit & debit card receivables; it is not a loan. Eligibility for a MCA is primarily based on a business' monthly credit and debit card sales.
What is the advantage of this service for me? There are no minimum monthly payments, no requirement of financial statements or tax returns, so the service really is simple, fast, and flexible.
How does it work? As an example, Tony's Pizza Palace processes on average $40,000 a month in credit and debit card transactions. They have been approved for $20,000 in funding.
| Funded Amount | $20,000 | (Dollar amount given to this business) |
| Factor Rate | 1.34 | (Cost of Capital) |
| Repayment Amount | $26,800 | (1.34 X $20,000 = $26,800) |
| Retrieval Rate | 12% | (Daily debit amount) |
Retrieval Rate? It is the fixed percentage of the daily credit & debit card transactions that Mercantile will debit from your bank account daily. This daily repayment amount is not a fixed dollar amount. Because payments are linked with sales, we get paid back less quickly during your slower periods. We get paid when you get paid.
- If Tony's processes $1,000 in a day, Mercantile will collect $120 (12%)
- If Tony's processes $ 500 in a day, Mercantile will collect $60 (12%)
What are the requirements?
- Accept either Visa, MasterCard, Amex or Debit
- Process a minimum of $10,000 per month in combined Visa, Master Card and debit sales
- Have a minimum of 6 full months of processing history
- Have no bankruptcies in the last 24 months