Many businesses require funding to assist them with cash flow, but fixed loan repayments can be difficult for some with unpredictable incomes.
Merchant cash advance is a loan that can help businesses in these circumstances if they take card payments above a set level. Merchant cash advance loans are paid through a small percentage of card sales, so it is a flexible loan that matches your business’ income.
Below we have explored some of the leading UK merchant cash advance loan providers.
Companies are ranked in no particular order.
| Company | Min Loan Amount | Max Loan Amount | Max Term | |
|---|---|---|---|---|
| 365 Business Finance | £5,000 | £200,000 | 10 months (renewable) | |
| Capify | £5,000 | £500,000 | Not stated | |
| iwoca | £1,000 | £50,000 | Not stated | |
| Liberis | Not stated | Not stated | Not stated | |
| Merchant Money | £5,000 | £500,000 | Not stated | |
| Nucleus Commercial Finance | £3,000 | £2 million | Not stated | |
| YouLend | £500 | £1 million | Not stated |
1. 365 Business Finance
- Offers merchant cash advance also known as business cash advance
- Unsecured finance solution
- Minimum loan of £5,000
- Maximum loan of £200,000
- No fixed monthly payments
- Repayments taken from a small percentage of debit and credit card payments
- Flexible repayment that matches your income
- No security or business plan needed
- Approval within 24 hours
- Get a quote online or call them to discuss your needs
Website 365 Business Finance Merchant Cash Advance
Read the full 365 Business Finance review
2. Capify
- Offers merchant cash advance to retailers, pubs, bars, restaurants and more
- Suitable for any business accepting credit and debit card payments
- Minimum loan of £5,000
- Maximum loan of £500,000
- Daily repayments taken from your incoming card payments
- Only a small percentage of takings is used
- Doesn’t impact your cash flow and works with the peaks and troughs of your business income
- Available to businesses and sole traders trading for over 6 months and at least £6,000 in card payment per month
- Dedicated account manager
- Call them to apply
Website Capify Merchant Cash Advance
Read the full Capify review
3. iwoca
- Offers repayments based on your revenue
- Pay a fixed fee only with no interest
- Minimum loan of £1,000
- Maximum loan of £50,000
- Funding available in 24 hours
- Link up your bank account for ease of payments
- Allows up to 2 times your month turnover
- Need to cover a minimum of 12.5% of the total cost every 3 months
- Apply online
- Highly rated on Trustpilot
Website iwoca Merchant Cash Advance
Read the full iwoca review
4. Liberis
- Offers a revenue-based payment model
- Suitable for small businesses
- Provided through global partners
- Must have monthly card takings over £2,500
- You need to have been trading for over 4 months
- Repay through card payments
- Card payments need to be through selected acquirers
- Most applications receive funds within 48 hours
- Single fixed cost rather than interest
- Apply through a Liberis partner
Website Liberis Merchant Cash Advance
Read the full Liberis review
5. Merchant Money
- Transparent merchant cash advance
- Up to 100% of your average monthly card turnover
- Minimum loan of £5,000
- Maximum loan of £500,000
- Factor rate starting at 1.15
- Loans available in 24 hours
- Top-ups offered after 4 months
- Works with all card terminal providers
- Automated process
- Apply online
Website Merchant Money Merchant Cash Advance
Read the full Merchant Money review
6. Nucleus Commercial Finance
- Offers business cash advance
- Borrow up to 175% of your monthly card revenues/sales
- Minimum loan of £3,000
- Maximum loan of £2 million
- Flexible repayments that match your revenue
- Fixed agreed cost no interest
- No hidden fees
- Fast decisions
- To be eligible you need to be registered in England or Wales and trading for over 4 years
- Apply online
Website Nucleus Commercial Finance Merchant Cash Advance
Read the full Nucleus Commercial Finance review
7. YouLend
- Revenue-based financing
- Open to card merchants
- Minimum loan amount of £500
- Maximum loan amount of £1 million
- Repayments taken from card sales
- Fee is a fixed amount
- Percentage of daily sales is automatically taken to repay the loan
- Fast decision on loans
- Can be embedded into online sales in 7 days
- Highly rated on Trustpilot
Website YouLend Merchant Cash Advance
FAQ
How does a merchant cash advance loan work?
Merchant cash advance loans are very different to other business financing options as they do not have regular fixed repayments or interest rates like traditional loans.
Merchant cash advance offers a loan that is repayable through the card payments that your business receives and a small percentage from those payments is taken as the repayment amount.
The repayment percentage is normally taken automatically and paid to the lender and the balance of the payments will be paid to the borrower. An agreed fixed amount is set at the beginning of the loan as the fee.
As the repayments are based on the card transactions the amount repaid will fluctuate with the income of your business making it a sustainable amount that doesn’t adversely impact business cash flow.
To be eligible for merchant cash advance you will need to be taking card payments at a level that meets the lenders criteria and you may need to use specific card payment providers depending on the lender.
How much can I borrow?
The amount you can borrow through merchant cash advance varies depending on the lender and will depend on the amount of card transactions processed during a month.
Some lenders offer loans from as low as £500 and go as high as £2 million. One lender states that they offer 175% of monthly card sales as a loan.
How much will a merchant cash advance loan cost?
Most lender do not state how much a merchant cash advance loan costs, but they all charge a one-off fee that is agreed at the beginning of the loan. There are no interest rate charges just the fixed fee.
How long can I borrow money for?
There is no fixed term for merchant cash advance loans as the loan is repaid through the card payments which can fluctuate on a monthly basis so it is difficult to predict exactly how long the loan will take to repay and the length of time will vary for each company.
Most providers do not state a maximum term but do cap the loan amount to a realistic amount that will be recovered within 6-12 months maximum.
How to apply for a merchant cash advance loan?
Most lenders will allow you to apply online for a merchant cash advance loan or you can contact them by phone to discuss your needs further.
Many providers offer a fast process for approving merchant cash advance loans so that businesses can access funding quickly.