MCA Calculator is an online tool to help business owners better understand the cost of a merchant cash advance. It uses inputs to calculate total payback amounts and estimated daily payments. It also includes innovative built-in validation tools to improve TVC and give users confidence in their determinations.
Merchant cash advances differ from traditional business financing options in that they don’t carry interest rates, and repayments are based on a percentage of sales rather than a fixed term length.
Amount Advanced
A merchant cash advance is a type of business financing that allows you to sell your future receivables for an immediate lump sum. The MCA calculator provides the information needed to understand the true cost of an MCA. This includes the total advance amount, factor rate (expressed as decimal or percentage), holdback percentage, and estimated sales volume.
Unlike traditional loans, MCAs do not have fixed interest rates and repayment terms are determined by a percentage of your daily credit card and debit sales. As such, the structure of an MCA can create cash flow challenges for businesses with volatile or seasonal sales. Our MCA calculator can help you estimate what your payments may look like on a daily or weekly basis, depending on your preference. This will also give you an idea of how long it may take to repay the full amount of your merchant cash advance. To get started, simply enter your desired advance amount and the associated values into our MCA calculator.
Payback Amount
A merchant cash advance (MCA) is a type of financing that allows a business to borrow money in exchange for a percentage of its daily credit card and debit card sales. This type of financing is different from traditional loans because it uses a variable amount to repay, meaning your payment may fluctuate day-to-day depending on your business’s performance.
The MCA Calculator is an easy-to-use tool that helps businesses understand the cost and repayment structure of this unique form of financing. Input a few basic numbers and the calculator will provide a clear picture of what your payments will look like on a daily basis until you pay back the entire amount advanced by the MCA lender.
The MCA Calculator takes into account several important variables such as the total advance amount, factor rate (expressed as either a decimal or a percentage), holdback percentage (the percentage of your daily sales that the funding company will take until you pay off the advance), estimated monthly sales volume and any additional fees or charges.
Approximate Daily Payment
MCA calculators allow business owners to see the true costs of financing, weigh benefits against costs and compare offers from different lenders. By entering in the terms and conditions of each offer (including factor rate, holdback percentage, estimated monthly credit and debit sales, and one-time fees) you can estimate how long it will take to repay your advance – including all of the additional charges and interest — and determine whether an MCA is a good fit for your business’s financial capabilities and goals.
Merchant cash advances differ from traditional business loans in that they don’t carry fixed interest rates and are repaid with a percentage of the company’s daily credit card or debit card sales, or an estimated ACH payment (based on average weekly sales). Experimenting with different advance amounts, factor rates, terms and remittance frequencies with this online calculator will help you understand what to expect when considering an MCA.
Approximate Days to Repay
A merchant cash advance is a type of financing that allows you to sell future credit card sales in exchange for immediate capital. The MCA Calculator tool estimates payment metrics like daily payments, percent of total credit card sales and cents on the dollar cost to help you assess the offer and make an informed decision.
MCA fees are based on a factor rate, which differs from the more familiar percentage-based interest rates used in consumer lending. Input the advance amount and factor rate into the MCA Calculator to estimate the payback amount, and then enter the estimated credit card sales volume to calculate the daily and weekly payments.
Understanding the costs and impact of a merchant cash advance is essential for business owners. With the right information, entrepreneurs can budget effectively and make informed decisions that align with their financial goals. In addition, MCA Calculator provides valuable insights for funding brokers and their clients, enabling them to better understand the terms of an offer and compare it to other options.
