Business and merchant cash advances

With a business or merchant cash advance, you can leverage tomorrow’s potential today. Get the capital you need to reinvest and grow your business.




As Soon As 24 Hours


3-36 months


As Low as 1.08

What is a business cash advance?

A business cash advance is a form of funding that offers businesses quick access to funds by borrowing against the money they will make. That borrowed money is then repaid through a fixed daily percentage. This type of funding may also be easier for some new businesses to obtain than traditional small business loans might be.

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How a business cash advance works.

The repayment process for a cash advance differs from that of a normal loan or even a credit card. Instead of making monthly set payments, your lender will withdraw a “fixed daily percentage” — a preset amount — from your account daily. The daily payments are used to repay the amount of the advance plus the factor rate of the funding.

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What is a merchant cash advance?

A merchant cash advance is a form of business financing that provides an advance on a business’s future credit card sales. Cash advances are repaid automatically through a percentage of the business’s daily credit card deposits.

Since merchant cash advances are flexible and carry no restrictions on how they can be used by the borrower and tend to fund quickly, they’ve often been used by businesses facing unexpected, cash-crunch emergencies.

How does a merchant cash advance work?

Once a business has received the advance from the financier, repayment begins. Each day, the lender will withhold the agreed-upon percentage of the business’s credit card deposits.

There are two ways the repayment of a merchant cash advance can be processed:

  1. Split Withholding Repayment: This method is most popular and permits a financier to take their agreed-upon percentage directly out of a business’s credit card revenue each day.
  1. Lock-box Repayment: The business’s daily deposits go straight to an account overseen by the lender, and each day, the business receives its share of the previous day’s deposits.

Business cash advance vs. merchant cash advance

Functionally, a merchant cash advance is similar to business cash advances, except the small business borrower receives an advance on future credit card sales. A business cash advance is repaid as an automated, fixed daily or weekly withdrawal based on cash flow. 

The lenders we work with primarily offer business cash advances with a few offering the option of a credit card split similar to an MCA. This method permits the financier to take their agreed-upon percentage directly out of a business’s credit card revenue each day.

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Is a business cash advance right for you?

There are some situations where a cash advance might be the RIGHT funding option, like:

  • Businesses with low credit scores
  • Newer businesses with limited credit history 
  • Businesses that need cash quickly
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Minimum requirements for a business cash advance.

If your business doesn’t match some of the qualifiers below, it may be more challenging to receive funding from our lending partners.


500 or higher




3 months

How to apply for a business cash advance.

Sure, you can go the bank route with a long application process and 75% rejection rate. But if you’re looking for financing in this lifetime, Lendio offers a faster, easier application process.

Fill out the 15-minute online application.

It’s secured with bank-grade encryption and SSL technology, so you know your information is safe.

Receive matches.

We pair you with loan options from our network of 75+ lenders. Our dedicated funding managers can help you weigh the pros and cons of each option.

Get funded.

Once you’re approved, you’ll be able to access your capital in as little as 24 hours.

Apply Now

Why use Lendio?


funded through us


lenders in our network


loans funded

“The Lendio process was amazing”

Sterling Hannemann
Co-Owner of Seven Brothers

“Lendio literally saved my business.”

Chloria Chandler
Owner of Bobbee O’s BBQ

Business cash advance FAQs

A business cash advance is an option for startup businesses that may not yet qualify for other types of business financing. Because a business cash advance is repaid based on your business’s income, time in business and other factors that can make securing financing difficult for startups don’t apply. If your startup has a strong income, a business cash advance could be an excellent solution for your fast-capital needs.

Startup loans and business credit cards can also offer accessible financing for startups and may be able to round out your financing plans


The benefits of a cash advance are what make it such a convenient form of funding. Because eligibility is based on the ability to repay the advance, usually the requirements for this type of funding aren’t too strict, making it ideal funding for businesses that are new, have bad credit, or lack collateral. Plus, you can get funding quickly with a cash advance. And, if you have low sales, your payments will stay low too.

The disadvantages of a cash advance though can sometimes outweigh the pros. It can end up costing you quite a bit depending on the factor rate of the cash advance. Plus, there’s no benefit to repaying early like there might be on other funding options. 

Quick to applyHigh cost of capital
Good for borrowers with low creditNo benefit to repaying early
Low revenue = low paymentsFrequent payments

Before taking a cash advance or any funding option, compare it with the other funding options available. Merchant cash advances are a unique form of financing with benefits and drawbacks: 

Merchant cash advance pros

  • Speed of funding: Cash advances are quick to fund and can often provide cash within 24 hours of approval.
  • Not collateralized: Generally, no collateral is required for a merchant cash advance. 
  • Long business history not required: Cash advances are often pitched to newer businesses or businesses with a shorter financial history, although you may be asked to provide 3-6 months of bank statements, receivables, or daily sales records.
  • Won’t appear on a credit report: Due to the unique structure of a merchant cash advance payment, it’s actually considered a sales transaction. This designation means it won’t appear on a credit report.

Merchant Cash Advance Cons

  • Expensive: Merchant cash advances typically have higher rates than other types of business financing. A high rate or longer repayment period due to low sales can result in an overall higher cost of financing. 
  • Not federally regulated: Since merchant cash advances are considered commercial transactions, they lack some of the regulations and requirements associated with other borrowing options.
  • Business credit may still be checked: Some financiers may check credit before approving the advance, which can impact the factor rate of the advance.
  • Doesn’t improve your credit: As mentioned above, due to the unique structure of a merchant cash advance payment, it’s considered a sales transaction and usually doesn’t appear on a credit report. But this means repayment of a merchant cash advance also won’t help build credit history or improve a credit score.

A cash advance can be used for a variety of business expenses. These may include purchasing inventory, covering emergency costs, investing in marketing efforts, managing seasonal sales fluctuations, renovating business premises, or even expanding the business. Essentially, a cash advance provides a flexible solution for any short-term capital needs, offering businesses the ability to handle unexpected costs or take advantage of lucrative opportunities quickly and effectively.

A loan and a cash advance are two different types of financial aid used by businesses, and they come with distinct differences. A loan is a type of debt where a lender, often a bank, provides a lump sum of money upfront, and the borrower repays the amount over a set period with interest. The repayment schedule is usually monthly and the interest rate is typically fixed.

On the other hand, a cash advance is a short-term funding option where the lender provides a lump sum of money that the borrower repays through a fixed percentage of their future sales. Also, instead of an interest rate, cash advances use a factor rate to calculate the total repayment amount. This makes cash advances a flexible, but often more expensive, option than traditional business loans.

Here is how a merchant cash advance generally compares to business credit cards and small business term loans. Note that these qualities can change based on the specifics of the specific financing type and the applicant’s creditworthiness.

Merchant cash advanceBusiness credit cardTerm loan
Credit requirementsLowMediumHigh
Repayment frequencyDaily or weeklyMonthlyMonthly
Maximum financing amount$2 million$100,000$5 million

When choosing a financing option, due diligence is essential. Also, know that funding timelines vary from lender to lender. While many lenders deliver the cash advance to the borrower’s account within 24 hours, a larger merchant cash advance from some lenders could take more than a week to arrive.

Quickly compare financing options from multiple funders.

Applying is free and won’t impact your credit

Talk to a rep at (855) 853-6346
Mon-Fri 7:30am-5pm MST