The best merchant cash advance (MCA) companies will offer funding in under 72 hours. While this type of financing is expensive and one that we only recommend as a last resort, rates, and fees should still be competitive when compared to other providers. The best MCA providers should also have a combination of flexible loan terms and easy qualification requirements.
Here are the six best merchant cash advance companies:
- Lendio: Best overall for rates, terms, and multiple loan options
- Credibly: Best for low starting factor rates
- GoKapital: Best for high-risk industries
- Libertas Funding: Best for high-revenue businesses seeking flexible repayment options
- Fora Financial: Best for newer businesses with large funding needs
- Reliant Funding: Best for low-revenue businesses
Best Merchant Cash Advance Companies At a Glance
Lendio: Best Overall for Rates, Terms & Multiple Loan Options
Why We Like Lendio
We selected Lendio as the overall best MCA company because of its combination of competitive rates, easy qualification requirements, and long repayment terms. As the only broker on our list, you’ll also be able to choose from multiple financing options.
It has a network of over 75 different lenders. With just a single application, you’ll have access to see all of the options you’re eligible for. This is beneficial for you as a borrower as it saves you time from having to apply separately to multiple lenders. It can also improve your chances of landing a loan approval. If you’re unsure of which option to choose, you can get guidance from a dedicated funding specialist on the Lendio team.
One downside of working with a business loan broker like Lendio, however, is the fact that you may not know the exact terms or qualification requirements until after you submit a loan application.
You’ll find Lendio’s MCA product on its website labeled as a business cash advance. This is targeted at businesses with lower credit scores, limited credit histories, and companies that need funds quickly. Repayments must be made daily, with the minimum payment amounts calculated based on a fixed daily percentage of your credit card sales.
As part of submitting an application, you should prepare to provide at least four to six months of business bank statements or receivables. Visit the Lendio website to complete the online application, a process that you should be able to complete in under 15 minutes.
Credibly: Best for Low Starting Factor Rates
Why We Like Credibly
Credibly has the lowest starting factor rates in our guide, making it a good option if you’re looking to save money on MCA fees. With that being said, borrowers should know that the best rates often require excellent qualifications, and meeting the minimum criteria listed above likely won’t be enough to get the best advertised rates.
In addition to the factor rate charged for an MCA, Credibly charges a one-time underwriting fee of 2.5% of your advance amount. You’ll also have to pay a monthly administration fee of $50 until the balance of the MCA is fully paid.
Getting an MCA with Credibly requires minimal documentation. You can qualify by providing a signed receivables purchase agreement, your business lease agreement, government-issued photo identification, and business bank statement for the past three months. Funding requests over $100,000 will require your most recent business tax return.
Credibly allows MCA funds to be used for nearly any business-related purpose. Some examples include costs for equipment, inventory, or payroll expenses.
To apply, visit the Credibly website. Online applications can be completed in under 10 minutes, and you can expect an initial response within 24 hours. If you are approved, funds can then be sent to your bank account within 24 hours.
GoKapital: Best for High-risk Industries
Why We Like GoKapital
If you have been having trouble getting funding due to the industry you operate in, GoKapital may be able to help. It states that all industries qualify for financing—and this includes cannabis, funeral homes, and those involved in firearm sales.
One potential downside with GoKapital is that its funding speeds are slightly slower than the other lenders we’ve selected for this guide. However, it is competitive when it comes to its rates, terms, and qualification requirements. For instance, it offers the largest funding amount out of the MCA companies we chose, has no restrictions on what funds can be used for, and has flexible eligibility criteria that even allows funding for businesses with active tax liens.
Another benefit of getting an MCA with GoKapital is the flexibility to make payments on a weekly basis, rather than daily. This can help your business cash flow depending on when you receive income from sales and other sources of revenue.
The provider does not list a minimum amount of revenue your business must earn to be eligible. However, it does state that approvals can be made for up to 50% to 150% of your average monthly sales. To apply or learn more, visit the GoKapital website.
Libertas Funding: Best for High-revenue Businesses Seeking Flexible Repayment Options
Why We Like Libertas Funding
Libertas Funding can offer some of the most flexible repayment terms available. While many of the best merchant cash advance lenders require payments to be made daily, Libertas Funding may allow you to make payments on a weekly, bi-weekly, and even monthly basis. This is something that can help your business from a cash flow perspective.
As with most MCAs, the rate and pricing you get will depend on your business qualifications and characteristics. This can include the industry you are in and your time in business, personal credit score, business credit, and business finances.
Getting an MCA with Libertas Funding can be more difficult, as it has the highest requirements for credit score and revenue. With that said, eligible businesses can get perks that are not found at most other companies. In addition to the flexible repayment schedules mentioned previously, you could get a prepayment discount of up to 25% by paying off your balance more quickly. Renewal options are also available.
To apply or learn more, visit the Libertas Funding website.
Fora Financial: Best for Newer Businesses With Large Funding Needs
Why We Like Fora Financial
Fora Financial can offer the largest funding amount with the shortest time in business requirement, making it our pick for newer businesses that need more funds. With just six months’ time in business, you could get an advance as high as $1.5 million.
With this provider, funds from its cash advance product can be used for nearly any business expense. Some examples include buying equipment, purchasing more inventory, and conducting renovations to office space. Popular industries Fora Financial works with include those in services, construction, restaurants, retail, and medical fields.
It offers you the ability to borrow additional funds once you’ve paid at least 60% of the original loan. This makes it a good option if you have recurring needs for additional funding. As an incentive to pay off your balance more quickly, prepayment discounts are also available.
If you’re uncertain about whether you’ll qualify, you can apply with no negative impact on your credit score. Fora Financial only conducts a soft credit inquiry at the time of the initial application, and a full check is only done upon approval. To apply, visit the Fora Financial website.
Reliant Funding: Best for Low-revenue Businesses
Why We Like Reliant Funding
Out of the individual providers on our list, Reliant Funding has the lowest annual revenue requirement. It also requires just six months’ time in business, making it a viable option for newer businesses that may not yet have large streams of revenue.
With it, you can work with a dedicated account manager. This individual’s role is designed to not only understand your needs to ensure an MCA is the right choice but to also provide you with personalized recommendations and guide you through the lending process to get you funded as quickly as possible.
Paying back a Reliant Funding MCA can be done on a daily or weekly basis. By comparison, most other MCA companies limit you to daily repayments. There are no restrictions on what business purpose you can use the funds for. Another benefit of working with Reliant Funding is the ability to get more funding once you have paid off 50% of the original balance owed.
To learn more, you can visit the Reliant Funding website and contact the company using its toll-free number. It also accepts online applications with no upfront costs, credit checks, or obligation to accept any loan offer.
How We Chose the Best Merchant Cash Advance Companies
The best merchant cash advance lenders were selected using the following criteria:
- Factor rates, fees, and estimated APRs
- Application, approval, and funding speed
- Flexibility of repayment terms and repayment schedules
- Qualification requirements, such as credit score, revenue, and time in business
- Availability of discounts, such as prepayment discounts
- Funding amounts offered
- Customer reviews and ratings
Alternatives to a Merchant Cash Advance
In most cases, MCAs should be considered a last resort for business owners who cannot get approved for other types of financing as it’s an expensive form of financing. If you need to get a small business loan, you should also consider the following types of business loans:
- Accounts receivable (A/R) financing: This type of loan allows you to borrow against invoices you have issued to clients but haven’t yet been paid. It can cost as little as 0.25% per week and provide up to $5 million in funding. You can view our list of the best A/R financing companies to find the lender best suited for your funding needs.
- Invoice factoring: Although similar to A/R financing, invoice factoring has your clients pay the outstanding invoices to a factoring company instead of to your business. You can typically get an advance of up to 80% of the invoice amount. Once the factoring company receives payment, it’ll distribute the funds to you, minus its fees. For more details, you can read our guide on how invoice factoring works.
- Working capital loan: These loans can give you the funding needed to cover daily expenses such as payroll, rent, and other operational costs. Working capital loans can be structured in different ways, including term loans and lines of credit. You can view our recommendations for the best working capital loans to get started.
- Small business line of credit: This is a revolving line of credit that you can access on an as-needed basis. Repayment terms are usually less than 24 months, and qualified businesses can get credit limits of up to $250,000 or more. For more details, you can read our guide on what a business line of credit is and how it works.
- Small business credit card: Credit cards can be a good option for small and medium expenses. Credit limits are commonly issued between $5,000 and $25,000 and up, with some providers offering introductory rates as low as 0%. See our roundup of the best small business credit cards for options.
Frequently Asked Questions (FAQs)
An MCA company is a provider that offers a business financing product, allowing companies to receive a lump-sum advance payment in exchange for a fixed percentage of their daily credit card receipts. MCAs are an expensive form of credit and should only be used as a last resort by businesses that cannot qualify for other forms of financing.
The factor rate charged by an MCA company plus any one-time or recurring fees will determine your total cost of borrowing funds. You can take your factor rate and multiply it by the amount of your advance to determine how much you must pay back for the advance to be considered paid in full.
An MCA should be used as a last resort. This is because it is a very expensive form of financing, with APRs often exceeding 100%, and MCAs also rarely offer early payment discounts. Since MCA companies expect payment to be made quickly, it can negatively impact your business cash flow.
An MCA is an expensive form of financing. Before choosing to get an MCA, consider using our MCA calculator to see how much it would cost, and consider the alternatives we’ve mentioned above. If you’ve decided that an MCA is right for you, the providers listed in this guide can provide competitive rates, terms, and a high level of customer service.