With a merchant cash advance, you can get a lump sum for your business and repay it using a percentage of your future sales. Merchant cash advance companies may use various names for this type of financing, but the structure remains the same — after you receive the funds, the company deducts a fixed percentage of your debit and credit card sales or an amount based on an estimate of your monthly revenue.
If you're considering a merchant cash advance, it's important to know your options. This type of financing can be expensive so you want to find a reliable provider that can offer fair terms.
CNBC Select rounded up the best merchant cash advance companies fit for various situations to help you find the right option for you. (See our methodology for more information on how we choose the best merchant cash advance companies.)
Best for flexible funding
Credibly
Types of loans
Long-term loans, working capital loans, business line of credit and merchant cash advance
Better Business Bureau (BBB) rating
A+
Loan amounts
$5,000 to $400,000
Terms
3–15 months
Minimum credit score needed
500+
Minimum requirements
Must have been in business for at least six months and have average monthly revenue of at least $15,000
Terms apply.
Pros
- Offers multiple options for small business financing
- Can get approved within four hours
- Low minimum credit score requirement
- Provides loan amounts of up to $400,000
- Funds deposited as soon as the same business day
- Considers overall business health as an approval criteria
Cons
- Requires an average monthly revenue of at least $15,000
Who's this for? Credibly stands out for its flexibility. The eligibility criteria are pretty lenient, and you'll need minimal documentation to apply, including a signed receivables purchase agreement, business mortgage statement or lease agreement, government-issued photo ID of all owners and business bank statements from the previous three months. Once you get the advance, you can use it for any business purpose.
Standout benefits: Credibly reviews applications within one business day. Once approved, you'll get the funds deposited into your bank account in as little as 24 hours. You can also get a discount for early repayment.
Best for established businesses
Libertas Funding
Types of loans
Term loans, merchant cash advance
Better Business Bureau (BBB) rating
A+
Loan amounts
Up to $5 million
Terms
3–24 months
Minimum credit score needed
625 for term loans, 650 for merchant cash advance
Minimum requirements
Must be a U.S. citizen or permanent resident with a U.S.-based business, minimum 2 years in business, 625 personal FICO score, $100,000 in average monthly deposits for term loans; $150,000 in monthly revenue and a 650 FICO score for merchant cash advance
Terms apply.
Pros
- Same-day financing available
- No prepayment penalties
- Provides financing of up to $5 million
Cons
- High eligibility requirements
Who's this for? Libertas Funding can be a good option if you own an established business and need access to a large amount of cash. You can get up to $5 million through revenue-based funding and get the money the same day. However, you must demonstrate at least $150,000 in monthly revenue and have a FICO score of at least 650, which are relatively high requirements for this type of financing.
Standout benefits: Libertas Funding provides flexible estimated remittance frequency options. You may also be eligible for renewal. There are no prepayment penalties — on the contrary, you can get a discount of 10% to 25% if you repay early.
Best for comparing options
Lendio
Types of loans
Term loans, business acquisition loan, equipment financing, business line of credit, SBA loans, business cash advance, commercial mortgage, startup loan
Better Business Bureau (BBB) rating
A+
Loan amounts
Up to $5 million
Terms
Vary by loan type and lender
Minimum credit score needed
Vary by loan type and lender
Minimum requirements
Vary by loan type and lender
Terms apply.
Pros
- Wide selection of loan types
- Ability to receive and compare multiple offers
Cons
- Varying times to receive funds, depending on the loan type
Who's this for? When shopping for a financial product, it's wise to compare various options. Lendio makes this process easy by connecting you with multiple lenders. To get a business cash advance through Lendio, you'll fill out a quick online application and receive loan matches from a network of over 75 lenders. Lendio's funding managers can help you weigh the pros and cons of each option.
Standout benefits: Once approved, you can get funded in as little as 24 hours. And eligibility requirements aren't too strict: you'll need a credit score of at least 500, $10,000 in monthly revenue and three months in business.
Best for bad credit
Fora Financial
Types of loans
Small business loan, revenue advance
Better Business Bureau (BBB) rating
A+
Loan amounts
$5,000 to $1.5 million
Terms
Up to 15 months
Minimum credit score needed
500
Minimum requirements
Be in business for at least six months; have $15,000 per month in revenue; no open bankruptcies
Terms apply.
Pros
- Offers higher funding amount compared to other lenders
- Considers lower credit scores
- Approval and funding in 24 to 48 hours, according to the lender's website
- Borrowers can increase loan amount after paying back at least 60% of the original loan amount
- Offers a prepayment discount
Cons
- Short loan term of just 15 months
Who's this for? Fora Financial allows qualifying business owners to borrow up to $1.5 million with a revenue advance. According to the company's website, bad personal credit won't necessarily disqualify you — Fora considers the overall health of your business. The minimum credit score to qualify is only 500.
Standout benefits: Fora Financial doesn't require a hard credit pull when you apply — it will perform one at funding. After you pay off at least 60% of the original amount, you can increase the borrowed amount. Additionally, you can get a discount for early repayment.
More on our top merchant cash advances
Credibly
Credibly is a digital platform specializing in funding solutions for small and medium-sized businesses. Besides merchant cash advances, Credibly offers a wide range of financing options, from term loans and working capital loans to invoice factoring and business lines of credit.
Available amounts
Up to $400,000
Minimum requirements
500 credit score, six months in business, $15,000 in average monthly bank deposits
Loan terms
3 to 15 months
Remittance frequency options
Daily
Libertas Funding
Libertas Funding is an online fintech company that provides financing to small and medium-sized businesses. Its products include term loans and merchant cash advances. The business term loans are issued by WebBank.
Available amounts
$50,000 to $5 million
Minimum requirements
$150,000 monthly revenue, 650 personal FICO score
Loan terms
3 to 12 months
Remittance frequency options
Daily, weekly, bi-weekly or monthly
Lendio
Lendio is a lending marketplace for small business owners. It works with a network of more than 75 lenders to provide a wide range of financing solutions, such as term loans, equipment financing, SBA loans, business loans for startups and more. Loan repayment terms can be as long as 36 months, which is longer than many competitors.
Available amounts
$5,000 to $2 million
Minimum requirements
$10,000 monthly revenue, 500 credit score, three months in business
Loan terms
3 to 36 months
Remittance frequency options
May vary by lender
Fora Financial
Fora Financial is an online lender with an A+ Better Business Bureau (BBB) rating that offers term loans and merchant cash advances. It works with small-business owners even with bad credit, considering the businesses' overall health.
Available amounts
$5,000 to $1.5 million
Minimum requirements
Six months in business, $15,000 in monthly gross sales
Loan terms
Not advertised
Remittance frequency options
Daily or weekly
FAQs
Is a merchant cash advance worth it?
If your business is struggling with cash flow and doesn't qualify for other types of financing, a merchant cash advance may be worth considering. Note, however, that this product may come with costly fees and high APRs.
Does a merchant cash advance affect your credit?
Generally, a merchant cash advance won't directly impact your credit since this type of financing isn't technically considered a loan.
Are merchant cash advances bad?
A merchant cash advance can help you in a cash-flow crisis — but it can also put you in a cycle of debt due to aggressive frequent payments and potentially high financing costs.
Are merchant cash advances secured?
A merchant cash advance doesn't require collateral, meaning it's not secured.
Bottom line
If traditional small business loan options don't work for you, a merchant cash advance can be an alternative. Like personal cash advances, this type of financing can come with high costs so make sure to review the terms carefully. Additionally, compare offers from multiple merchant cash advance companies to ensure you get a fair deal.
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Why trust CNBC Select?
At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every small business loan review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of small business loan products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics. See our methodology for more information on how we choose the best merchant cash advance companies.
Our methodology
To determine our picks for the best merchant cash advances, CNBC Select analyzed several U.S. merchant cash advances offered by both online and brick-and-mortar companies.
We compared each cash advance on a range of features, including:
- Minimum and maximum loan amounts
- Length of term
- Remittance frequency options
- Credit score needed
- Application requirements
- Streamlined application process
- Fund disbursement
- Customer support
- Better Business Bureau rating
- Customer reviews, when available
The rates and fee structures for small business financing are subject to change without notice, and they often fluctuate per the prime rate.
To take out a merchant cash advance, companies may conduct a hard credit inquiry and request a full application, which could require both personal and business proof of income, identity verification, proof of address and more.
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