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Merchant Cash Advance Fees & Costs

When shopping around for a Merchant Cash Advance (MCA), it is important to keep several factors in mind, including fees and added costs. 

Here’s a quick breakdown of some common fees and costs:

  • Factor rate. An MCA is not a loan — it does not accrue interest and there is no APR. However, it does bear what we call a factor rate, which will fluctuate from funder to funder. All MCAs have a factor rate, so the best way to ensure you’re getting the best rate is by shopping around. Be careful, though, as many funders out there will pull your credit score in order to get you a quote, which could damage your score. To find out if a funder plans to pull your credit, simply ask them — they are legally required to tell you.
  • “Underwriting” or “origination” fees. Some funders and brokers will charge various fees for underwriting or origination, sometimes as much as $2,000 or $3,000. This is deducted from the funding amount you receive, and you will still be required to pay the full payback amount. The funders that take part in this unethical practice are not always upfront about the fees being charged until after you have accepted the MCA, so it’s important to stay informed and ask questions before accepting the advance
  • Commission. Keep an eye out for the commission amount your broker receives. At Elevate Funding, when we bump up broker commission, it does not come out of your pocket. Their commission bonuses do not compromise our valued clients getting the best rates possible. However, many other funders allow for “upselling” — which effectively means they charge you more so that your broker will receive a higher commission. 
  • Funding fees. Funding fees are the costs the funder incurs while helping you get funding — this typically includes the use of 3rd party vendors. We keep these fees simple, though. For advances over $6,500, we charge a flat $500 fee, which covers your ACH/Lockbox. We even waive this fee for advances under $6,500, and we charge no fees for clients making payments directly from a supported credit card processor.
    Recently, upon completing a competitive analysis, we found that many of our competitors are charging 7% or 8% of the advance amount in funding fees — so if your advance is $20,000, that would be $1,500 in funding fees. That’s pretty steep if you ask us!

So how do you know if your MCA offer is a good rate and that the fees being charged are within reason? Shop around, and be sure the funder you ultimately choose is reputable. 

When you select us as your funding provider, you are placing a safe bet on your financial future. With each working capital offer, we provide an information sheet that outlines exactly what you’re paying and what fees are being charged. We strive for transparency and an excellent customer experience, and it shows. Ninety-three percent of our active clients say they are very satisfied with our service, and 98% say they can rely on us.

We want to see you succeed, and we will do everything in our power to work with you on your specific needs. We know small business, and we’re here to help.

If you need funding and wish to speak to someone now, please call us at 888-382-3945 or click here to send us an inquiry. One of our teammates will get back to you as soon as they are available.


Revenue-Based Finance is formerly and alternatively known as Merchant Cash Advance, or MCA.