Pricing
At Merchant Funding Advance we understand that every business is unique, and so is our approach to merchant cash advance pricing. We tailor the pricing to your specific business and its performance. There are no fixed monthly payment terms or hidden costs. You simply repay when you make sales to your customers using your card machine.
Eligibility Criteria
Has your business been trading long enough?
As a general rule, we recommend a minimum trading history of three months. It's important to have a history of customer transactions through your merchant card terminal, also known as a PDQ machine.
Is your business turnover sufficient?
Different lenders have varying requirements. Some accept smaller monthly turnover figures, such as £1000, while others consider businesses with a turnover of over £5000 per month plus.
Calculation of Merchant Cash Advances
Once you meet the eligibility criteria, our lenders will offer you an amount generally equivalent to your average monthly card transactions. For example, if your business has a monthly card sales turnover of £10,000, most lenders will offer a cash advance of £10,000. In some cases, lenders may even provide slightly more than your card takings. The specific amount depends on various factors related to your business’s financial health.
Cost of Merchant Cash Advance
Like any business lender, our merchant cash advance providers need to cover costs. They calculate the repayment amount by multiplying the loan amount by a 'factor rate.'
What is a factor rate?
A factor rate is a percentage figure. Let's use the example above. Suppose your business is eligible for a £10,000 cash advance. Lenders may offer a factor rate ranging from 1.1 to 1.5. Consider a factor rate of 1.4. It's straightforward: the loan value (£10,000) is multiplied by the factor rate (1.4), resulting in a repayment value of £14,000.
Repayment Calculation
Repayments are calculated based on a percentage of your card sales. For instance, if the repayment rate is 10%, when you make a £100 sale and the customer pays via your card machine, £10 (10% of the sale) is repaid from your merchant cash advance to the lender. This repayment is usually processed in real-time via the card processor. It’s important to note that cash sales are generally not considered for repayment—only a portion of your card sales.
Additional Charges
Our lenders are committed to transparency, and we assure you that there are no hidden charges or fees.
