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ClearValue Lending

Cash today against tomorrow's sales — funded in 24–48 hours.

Revenue-Based Financing (Merchant Cash Advance) — Fast Working Capital for Small Businesses

A lump-sum advance against future sales, repaid daily or weekly as a percentage of revenue or a fixed ACH debit. Fast, revenue-led, broadly accessible — but expensive if mispriced.

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At a glance

Amount

$5,000 – $500,000

Term

3 – 18 months (most commonly 6 – 12)

Pricing

Factor rate 1.18 – 1.55 (≈ 30 – 110% effective APR depending on term)

Time to fund

24 – 48 hours after signed contract

Qualifications

500+ owner FICO, 6+ months in business, $10,000+ monthly business deposits

Revenue-Based Financing key terms at a glance

Typical amount

$5,000 – $500,000
Rate

Factor rate 1.18 – 1.55

Approx. effective APR ≈ 30% – 110%
Term

3 – 18 months (most commonly 6 – 12)
Funding speed

24 – 48 hours after signed contract
Best for

Cash today against tomorrow's sales — funded in 24–48 hours.
Source: ClearValue Lending funding-partner network — illustrative ranges, see product page for detail · as of 2026-08-02. Illustrative ranges — actual terms depend on lender review of your full file.
See your Revenue-Based Financing options

See Your Approval Odds Across Financing Products

Heuristic approval-likelihood estimate per product based on your business profile — no hard credit pull, no commitment, takes 10 seconds. Final approval is the lender's decision after underwriting your full file. Estimates below are shown as Approval Likelihood by Product.

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Network-typical eligibility floor

Files at or above these thresholds typically have the broadest lender access. Below doesn't mean declined — the lender decides on the full file.

Product FICO Time in business Revenue
Revenue-Based Financing 500+ 4+ months $8K+ monthly deposits
  • Revenue-Based Financing: Bank-statement-led underwriting; FICO weighted least vs other products.

What to assemble before applying

Network-typical document requirements. Faster files have these ready on Day One.

Revenue-Based Financing

  • Business bank statements — Most recent 3 months
  • Voided business check — For ACH setup
  • Owner photo ID — Driver's license or passport
  • Business entity proof — Articles, EIN letter, or LLC certificate
  • Business bank statements — 4-6 months for stronger pricing
+ may be requested
  • Business debt schedule — If multiple existing positions
  • Voided check from a second account — If splitting deposits

Lender-specific stipulations may add to this list. Have the required items ready at intake to start the underwriting clock.

How an MCA priced at a 1.28 factor actually looks

$50,000 advance at a 1.28 factor over 9 months

Advance amount
$50,000
Factor rate
1.28
Total payback
$64,000
Cost of capital (dollars)
$14,000
Term
~189 business days (≈ 9 months)
Daily ACH debit
≈ $339 per business day
Effective APR (illustrative)
≈ 60%

Why this matters: Same factor rate over 18 months instead of 9 would price closer to 30% effective APR — term length, not factor, drives the comparable rate.

What underwriters actually weight

Deposit consistency

Three months of deposits within a tight band signal stable revenue and unlock better factor rates.

Average daily balance

Strong end-of-day balances tell the funder the daily debit won't break cash flow.

Existing position stack

A clean stack (one or no open MCA) is the single biggest underwriting lever — stacking is the most common decline reason.

Time in business

6+ months is the floor; 12+ months and 24+ months tier into materially better pricing.

Typical files we route to Revenue-Based Financing

Illustrative scenarios drawn from the lender partner network — not specific customer data. Your actual options depend on your file.

Northeast restaurant, 14 months TIB

Situation

$25K inventory + payroll gap before a banner holiday weekend after a slow shoulder month.

Typical match

Short-term revenue-based advance with a daily ACH debit sized to ~8% of trailing deposits — file priced mid-range factor on consistent statements.

Speed

Funded 36 hours after signed contract.

Illustrative — not specific applicant data

Southeast retail boutique, 8 months TIB

Situation

$15K to take advantage of a same-week supplier discount that exceeded the cost of capital.

Typical match

Smaller advance, 6-month term, weekly ACH instead of daily — fit a thin-deposit file that wouldn't have passed a daily-debit underwriter.

Speed

Offer next business day; funded inside 48 hours.

Illustrative — not specific applicant data

Midwest e-commerce operator, 18 months TIB

Situation

$75K to refresh inventory ahead of Q4 — bank line declined for thin profitability.

Typical match

Revenue-based advance against card processing receivables — fixed daily holdback as a percentage of card sales, not ACH.

Speed

Approval within 24 hours; funded inside 3 business days.

Illustrative — not specific applicant data

How Revenue-Based Financing funding moves

Three steps from application to funded. ClearValue Lending handles intake + matching; the funding partners make the offer and funds.

1

Submit 3–6 months of bank statements

Plus a voided business check, owner photo ID, and basic business info (EIN, time in business, industry). Strong files add a debt schedule.

2

Receive an offer in 1–3 business days

Network funders price the file against deposit consistency, FICO, time in business, and existing positions. We surface the strongest legitimate match.

3

Funds wire after signed contract

Most signed contracts fund inside 24–48 hours. ACH debit or card holdback schedule kicks off the next business day.

How an MCA is structured

Three numbers define every MCA:

  • Advance amount — the cash you receive up front (e.g., $50,000)
  • Factor rate — the multiplier applied to the advance to determine total payback (e.g., 1.28)
  • Term / payback schedule — how the payback is collected (e.g., daily ACH for 9 months at $339/business day)

On a $50,000 advance at a 1.28 factor over 9 months: total payback is $64,000, collected as ~$339 per business day across 189 business days. The cost in dollars is $14,000. Translated into a comparable APR, that's roughly 60% effective APR — not because lenders are lying, but because factor rates and APR are different math. Always run the conversion before signing.

Who actually qualifies

Partner-network minimums for an MCA — across most lenders we work with — sit around 500+ owner FICO, six months in business, and $10,000+ in monthly business deposits (consistent across at least three months of statements). Stronger files (12+ months in business, $25k+/month, 600+ FICO) get materially better factor rates. The single biggest pricing lever is deposit consistency, not credit score.

When an MCA is the right tool

MCAs are misused more often than they're abused. The cleanest use cases are short, ROI-positive uses of capital where the time value of speed matters more than the cost: filling a same-week inventory order from a major customer, replacing equipment that's idling production, taking advantage of a supplier discount that exceeds the cost of capital. Long-horizon uses (build-out, vehicle purchases, seasonal stockpiling for next year) belong in cheaper products if you qualify for them.

What to watch for in the contract

Three contract terms have outsized impact: the holdback or daily debit amount (relative to your actual daily deposits), the reconciliation clause (whether you can request a payment recalculation if revenue dips), and any confession of judgment language (banned in New York commercial transactions since 2019, but still exists in some out-of-state contracts). Read these end to end. A reputable broker explains them line by line before you sign.

Regulatory + market context

  • MCAs are legally structured as the purchase of future receivables, not loans — which is why TILA (Truth in Lending Act) APR disclosure rules don't apply the way they do to consumer credit. — CFPB Regulation Z
  • Eleven states — California (SB 1235), New York (AB 10118), Virginia, Utah, Georgia, Connecticut, Florida, Kansas, Louisiana, Missouri, and Texas — now require commercial financing disclosures including APR-equivalent figures on small business MCAs. — California DFPI
  • New York banned out-of-state confessions of judgment (COJs) in 2019 under CPLR §3218 after CFPB and journalist investigations exposed predatory COJ-enforcement patterns in second-position MCAs. — NY Civil Practice Law & Rules §3218
  • Federal Reserve Small Business Credit Survey 2025 report (published March 2025, covering 2024 survey data) confirms MCAs remain among the most-used non-bank financing products but carry the highest effective cost — driving continued CFPB and state regulator attention. — Fed SBC Survey 2025 (2024 data)

Frequently asked questions

What credit score do I need for an MCA?
Most MCA lenders in our network approve at 500+ owner FICO. Lower scores are possible with strong deposit history (12+ months in business and $20,000+ in monthly business deposits), but pricing reflects the additional risk.
How fast can an MCA fund?
Most approved MCAs fund within 24–48 hours of a signed contract. Files with clean documentation (3 months of business bank statements, photo ID, voided check) move fastest.
What's the difference between a factor rate and APR?
A factor rate is a multiplier — 1.28 on a $50,000 advance means $64,000 total payback. APR is annualized cost. The same factor rate produces very different APRs depending on term length: 1.28 over 9 months is roughly 60% APR, but 1.28 over 18 months is roughly 30% APR. Always convert before signing.
Is an MCA a loan?
No. An MCA is the legal purchase of a portion of your future receivables. That structural difference is why MCAs aren't governed by traditional lending APR-disclosure rules and why pricing uses a factor rate instead of interest.
What does 'stacking' mean and why is it risky?
Stacking is taking out a second (or third) MCA while a first is still active. It's risky because each new daily debit compounds the cash-flow drag on the business — most files that fail underwriting at our network are over-stacked, not credit-impaired.
Can I pay off an MCA early?
Some MCAs offer prepayment discounts (often 5–15% off the remaining payback). Many do not — the full factor-rate payback is owed regardless of how fast you repay. Confirm this in writing before signing.
What documents do I need to apply?
For most MCAs: three months of business bank statements, a voided business check, owner's driver's license, and basic business information (EIN, time in business, industry). Stronger files may also include YTD profit & loss and a current debt schedule.

Best fit

  • Businesses with strong daily/weekly revenue but thin credit
  • Time-sensitive opportunities (inventory, equipment fix, opportunity capital)
  • Owners turned down by banks who don't fit traditional underwriting
  • Industries with revenue but seasonal swings (restaurants, retail, e-commerce)

Probably not the right tool if

  • Long-horizon investments where a longer, cheaper loan is available
  • Businesses with thin daily cash flow that can't absorb daily/weekly debits
  • Owners who already carry a cash advance and would be stacking
  • Operators who haven't run the math against an APR-priced alternative

Industries that lean on this product

Related guides

What is a Merchant Cash Advance (MCA)?

What an MCA is, why businesses use it, how repayment works, and how it differs from a traditional bank loan — the short version.

Read guide →

Factor Rate vs APR: How to Compare Business Loan Offers (2026)

Two offers, two different pricing conventions. Here's the math to translate factor rates into APR so you can compare apples to apples.

Read guide →

When to Choose an MCA Over a Bank Loan

MCAs cost more than bank loans on paper. Here's when speed, qualification, and flexibility actually make them the right call.

Read guide →

5 Signs of a Predatory Lender

Predatory lenders are common in small business finance. These five tells are how you spot them before signing.

Read guide →

Why Stacking Loans Can Destroy Your Business

Stacking — taking a second MCA on top of an existing one — is the fastest way to compound a cash flow problem into a crisis. Here's the math.

Read guide →

Quick answers

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Editorial disclaimer: This page is for educational purposes and is not financial, legal, or tax advice. Rates, fees, qualification requirements, and product availability are illustrative ranges that vary by lender, market conditions, and individual business profile. ClearValue Lending is a funding platform; all financing is subject to lender partner approval and terms. Actual approval, amount, and pricing depend on lender review. Always read your contract end to end and verify specific numbers before signing. ClearValue Lending is compensated by the funding lender on closed transactions.

https://clearvaluelending.com/business-loans/mca

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