5 Best Merchant Cash Advance Companies for Small Businesses

Small Business
April 30, 2022

Small business owner on the phone with a cash advance company.

The cost of funding your business is always a concern, and it can be difficult for small business owners to find the right source. A merchant cash advance (MCA) provides a quick way for entrepreneurs who need money fast, but they should only use this option as their last resort because these loans carry high interest rates that will quickly add up if you’re not careful with how much time elapses between payments.

Trying different lenders in order to get something appropriate without going through long processes? In this article, we talk about five companies we think may work best for small businesses.

Best Merchant Cash Advance Direct Lenders To Consider

If you’re looking for the best merchant cash advance companies, be sure to compare different lenders very carefully. There are tons of predatory providers in this space, so make sure that before signing any agreement with them thoroughly vet your options.

Our five picks below should help make things easier.

1. Lendio

  • Loanable Amount: $5,000 to $200,000
  • Time in Business to Qualify: at least 6 months
  • Repayment Terms: up to 2 years
  • Estimated APR: 18% and up
  • Funding Speed: at least 24 hours from approval
  • Collateral Required? Not specified
  • Restrictions On Use? None
  • Free Quote? Yes

Lendio is the best option for small businesses because it only requires $2,500 in monthly credit card transactions and funding can be requested as soon as 24 hours. They also offer alternative business financing options that would otherwise be much more expensive than a merchant cash advance. To qualify for merchant funding, your business should be operating for at least six months, have a minimum of $2,500 in monthly credit card sales, and be in sound financial health.

2. National Funding

  • Loanable Amount: $5,000 to $500,000
  • Time in Business to Qualify: at least one year
  • Repayment Terms: up to 18 months
  • Estimated APR: 30% to 150%
  • Funding Speed: at least 24 hours from approval
  • Collateral Required? No
  • Restrictions On Use? None
  • Free Quote? Yes

National Funding is best for businesses that have been in operation for at least one year and have a credit score of at least 550. To qualify for merchant funding, your business should be operating for at least a year, have at least $3,000 per month in credit card transactions, and have no open bankruptcy issues. 

3. PayPal Working Capital

  • Loanable Amount: at least 35% of your annual PayPal sales
  • Time in Business to Qualify: must have a PayPal Business or Premier account for at least 3 months
  • Repayment Terms: a percentage of each sale, minimum payment required every 90 days
  • Estimated MCA fees: 10% to 30% of daily PayPal sales, plus a flat fee (depending on PayPal sales history and loan amount)
  • Funding Speed: 5 minutes (loan decision can take up to 7 days in limited cases)
  • Collateral Required? No
  • Restrictions On Use? None

To qualify for merchant funding via PayPal Working Capital, you should have a PayPal Business or Premier account for at least three months and process a minimum of $20,000 in annual PayPal sales (or projected to do so) for Premier accounts or $15,000 for Business accounts. Generally, it does not require documentation, as the loan decision will be based on your PayPal activity, but the lender may ask for additional proof of business or income in certain cases. 

4. Fora Financial

  • Loanable Amount: $5,000 to $750,000
  • Time in Business to Qualify: at least 6 months
  • Repayment Terms: 4 to 18 months
  • Estimated Annual Percentage Rate (APR): 35% to 175%
  • Funding Speed: at least 72 hours from approval
  • Collateral Required? No
  • Restrictions On Use? None
  • Free Quote? Yes

Fora Financial is one of the top merchant cash advance providers because it offers a wide range of funding options for businesses of all sizes, but it’s also the most expensive option on this list. You can borrow anywhere from $5,000 to $750,000 with repayment terms of 4 to 18 months. To qualify for merchant funding, your business should be operating for at least six months, have a minimum of $5,000 in monthly credit card sales, and have no open bankruptcies.

5. CAN Capital

  • Loanable Amount: $5,000 to $250,000
  • Time in Business to Qualify: at least 3 years
  • Repayment Terms: up to 13 months
  • Estimated APR: 35% to 200%
  • Funding Speed: at least 2 business days from approval
  • Collateral Required? Not specified
  • Restrictions On Use? None
  • Free Quote? Yes

CAN Capital is one of the top merchant cash advance companies for businesses that need a large amount of funding. You can borrow anywhere from $5,000 to $250,000 with repayment terms of up to 13 months. To qualify for merchant funding, your business should be operating for at least three years, have less than $175,000 in outstanding tax liens or judgments, have a personal guarantor FICO score of at least 600, and have no open or dismissed bankruptcy in the last 2 years.

3 Things You Should Know About MCA Companies Before Diving In

It may be tempting to jump into what merchant cash advance direct lenders offer but bear in mind the following before you sign anything:

1. Merchant cash advances are not loans.

This is an important distinction to make because it means that merchant cash advance providers do not follow the same regulations as banks or other lending institutions. For that reason, merchant cash advance companies can charge much higher interest rates as well as fees for their services.

2. Merchant cash advances are not for businesses in financial trouble.

If your business is struggling to make ends meet, a merchant cash advance is not the solution you’re looking for. In fact, it might make your financial situation worse because the interest rates are typically high and the repayment terms can be difficult to meet.

3. Merchant cash advance providers are not all created equal.

Just like with any other type of business, there are good merchant cash advance providers and bad ones. It’s important to do your research and make sure you’re working with a reputable provider before you agree to anything.

Need An Easier, Friendlier Financing Alternative To MCAs? Consider LendThrive

MCAs are expensive and can be difficult to repay, which is why they might not be the best option for small business owners. If you’re looking for a more affordable and manageable financing alternative, consider LendThrive.

LendThrive is a leading online provider of fixed rate business loans. We provide funding support in a way that is considerate of what small business owners need, with low interest rates, flexible repayment terms, and no hidden fees.

What’s more, our application process is simple and straightforward, so you can get the funding you need without all the hassle. You can get as much as $150,000 in as fast as 24 hours. To learn more about what we have to offer, check out our website or apply for a business loan today.

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