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.
Director, FundBiz
Oliver leads FundBiz's specialty finance comparison and matching engine. With a background in UK commercial finance, he oversees lender partnerships, eligibility logic and post-decline routing.
Last reviewed: 26 April 2026
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
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.
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.
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.