What is a Merchant Cash Advance?
A merchant cash advance (MCA) is a form of business funding where a lender advances a lump sum against a business's future credit and debit card sales. Repayment is taken as a percentage of daily card takings — meaning repayments flex with revenue rather than being fixed. MCAs are among the fastest business finance products available in the UK but typically carry a higher cost than traditional loans. Seven Hills Capital Group will always compare the full market before recommending an MCA.
How Merchant Cash Advance works in practice
A lump sum advanced against your future credit and debit card sales. Repayments flex with your revenue, making it ideal for businesses with fluctuating daily takings.
How it works
The lender assesses your average monthly card takings
An advance is made — typically 100–150% of your average monthly card revenue
Repayment is taken as a fixed percentage of daily card sales — typically 10–20%
On high-revenue days you repay more; on quiet days you repay less
The advance is fully repaid when the total agreed amount has been collected
Who It Is Right For
- MCAs are suited to businesses with strong card-based revenues — hospitality, retail, food and beverage, leisure and entertainment.
- They are particularly useful for businesses that need fast access to cash and can tolerate a higher cost of finance in exchange for speed and flexibility.
Pros
- Fast approval — often within 24–48 hours, one of the fastest UK business finance products
- Repayments flex with revenue — quieter trading periods mean automatically lower repayments
- No fixed monthly repayment date — reduces pressure during slow periods
- No security or assets required in most cases
Things To Consider
- Higher cost than traditional business loans — factor rates rather than annual interest rates
- Only available to businesses with significant and consistent card revenue
- Daily repayment deduction can impact cash flow in tighter periods
- Total cost can be difficult to compare directly with traditional loan APRs — always check the total repayable
Why Use Seven Hills Capital Group
MCA pricing varies significantly between providers. Factor rates, retrieval rates and total repayable amounts differ considerably across the UK market. Seven Hills Capital Group will always compare the full cost of a merchant cash advance against alternative products — including working capital loans and invoice finance — to ensure an MCA is genuinely the right product for your situation.
Frequently Asked Questions
How is a merchant cash advance repaid?
Repayment is taken as an agreed percentage of your daily card takings — deducted automatically. On days with high card revenue you repay more; on quiet days you repay less. There is no fixed end date — the advance is fully repaid when the total agreed amount has been collected.
How much can I borrow with a merchant cash advance?
Most MCA providers advance between 100% and 150% of your average monthly card revenue. If your business takes £30,000 per month in card payments, you could typically access £30,000–£45,000. Seven Hills Capital Group will identify the maximum advance available based on your actual card processing data.
How quickly can I get a merchant cash advance?
A merchant cash advance is one of the fastest UK business finance products. Many providers can approve and fund within 24–48 hours once card processing data is verified. We will go straight to the right provider for your card revenue profile.
What is a factor rate and how does it affect the total cost?
MCA providers charge a factor rate rather than an interest rate. A factor rate of 1.25 on a £20,000 advance means you repay £25,000 in total. The equivalent APR can be significantly higher than traditional business loan rates — always check the total repayable amount before committing.
Is a merchant cash advance right for my business?
An MCA may be right if you have strong card revenue, need fast access to cash, and can accept a higher cost of finance. If time allows, a business line of credit or working capital loan will typically be cheaper overall. Seven Hills Capital Group will always compare the full market before recommending a merchant cash advance.
Not sure if Merchant Cash Advance is right for your business?
Our team will tell you honestly in one conversation whether this is the right product for your situation — and if not, what is.