Merchant cash advance (MCA)
A UK merchant cash advance is a lump-sum business loan repaid as a fixed percentage of your daily card-machine takings. Repayment scales with sales, so busy days repay more and quiet days less. Typical UK tickets run £3,500 to £500,000, factor rates 1.10 to 1.45, repaid over 6 to 12 months. Best fit for hospitality and retail with evidenced card flow above £5,000 per month. Same-day decisions; funding inside 5 days.
At a glance
- Ticket size
- £3,500 to £500,000
- Typical factor rate
- 1.10 to 1.45
- Term equivalent
- 6 to 12 months (variable)
- Repayment
- % of daily card takings
- Decision
- Same day to 48 hours
- Funding
- Same day to 5 days after decision
- Personal guarantee
- Usually required (some no-PG options)
- Soft search
- Yes at quote stage
Founder & Managing Director, Muswell Rose, FundBiz
Adam is the founder and managing director of Muswell Rose and a founder of Best Business Loans Ltd, the company behind FundBiz. His background runs through commercial finance, mortgages and fintech, including as managing director of an invoice finance business. He oversees FundBiz's specialty finance comparison and the logic behind how businesses are matched to lenders.
Last reviewed: 26 April 2026
How it works
You take a lump sum (the "advance"). Repayment is a fixed percentage of every card-machine transaction, taken at source by the acquirer or via a daily direct debit, until the agreed total (the advance multiplied by the factor rate) is paid. A £50,000 advance at factor 1.30 means you repay £65,000 in total.
The term is variable: when sales are strong, repayment finishes faster; when sales dip, the term stretches. There is no fixed end date, which is the model's defining feature.
Who it fits
- Hospitality (restaurants, pubs, cafés, hotels with strong card-payment flow).
- Retail (bricks-and-mortar shops, high-traffic e-commerce with strong gateway flow).
- Service businesses with card-machine acceptance (salons, gyms, mobile beauty).
- Borrowers with credit-history blemishes that make mainstream term-loan acceptance unlikely.
Who it does not fit
- B2B service businesses with bank-transfer or invoice-based revenue.
- Businesses with low or sporadic card-machine flow (under £5k a month).
- Borrowers prioritising rate over speed: term loans are materially cheaper.
Lenders we route to
Capify, 365 Business Finance, Liberis, YouLend. Each has a different sweet spot on ticket size, sector specialism and credit-history tolerance. The matcher uses your monthly card volume, sector and credit profile to rank likelihood of approval. Not sure MCA is the right product? Compare business finance options side by side first.
FAQ
What is a merchant cash advance?
A merchant cash advance is a lump-sum business loan repaid as a fixed percentage of your daily card-machine takings. Repayment scales with sales: busy days repay more, quiet days less.
Is MCA cheaper than a term loan?
Usually no. Factor rates of 1.20 to 1.45 over typical 6-12 month terms work out to effective APRs of 30-90 percent. MCA is faster and more accessible than a term loan, not cheaper.
What card volume do I need to qualify?
Most UK MCA lenders want at least £5,000 to £10,000 a month in card-machine takings, evidenced by 3-6 months of statements. Lower volumes are accepted by smaller direct lenders but at higher factor rates.
Alternatives to weigh up
If your income comes through more than the card machine, revenue-based finance works the same way against total turnover rather than card takings alone. Online sellers should look at e-commerce funding, and where you can meet the criteria an unsecured business loan is usually materially cheaper than an advance. If the need repeats rather than being one-off, a revolving credit facility charges only for the days you draw, and a fixed lump sum over 3 to 18 months is compared on our short term business loans page.
Run the numbers first
MCA pricing uses a factor rate, not an APR. Convert your offer to a comparable annualised cost, then check your working-capital cycle to see how the daily-takings split lands against your float.
Apply
Open MCA eligibility checker →Last reviewed: 26 April 2026.