MCA Calculator: True Cost, APR & Daily Payment

How this calculator works

A merchant cash advance isn't a loan and doesn't carry an interest rate — it uses a factor rate (usually 1.15 to 1.55) applied to the advance to determine total payback. That structure hides the annualized cost. The APR your offer really carries depends on how fast you pay it back:

• Payback = advance × factor
• Net funded = advance − origination/wire/ACH fees deducted at close
• Total cost = payback − net funded
• Effective APR ≈ (total cost ÷ net funded) × (365 ÷ days to payoff) × 100

A $50,000 advance at 1.35 factor with 3% fees, paid in 6 months, nets you $48,500 and costs $19,000 — that's an effective APR near 78%, not the "35%" a rushed broker might imply. Stretch the same deal to 12 months and the APR drops to ~39%. The single biggest lever on true cost is term length, not factor.

What to compare before you sign

1. Two or three MCA offers side-by-side — different funders quote wildly different factors for the same file.
2. MCA vs a business line of credit — a $50k LOC at 18% APR that you draw and repay costs a fraction of a same-size MCA. Full comparison here.
3. MCA vs SBA — if you can wait 2–6 weeks and clear the underwriting box, SBA prices at 10–13% APR. Compare terms.
4. Prepayment discount — some funders discount the factor if you pay early; many don't. Ask in writing before you sign.

When an MCA actually makes sense

Short-cycle, high-ROI use cases: buying inventory that turns in 30–60 days, funding a job with a signed contract, bridging a known receivable, or covering a seasonal spike in demand. The math works when your incremental gross profit on the capital exceeds the total cost — not the APR. If you're borrowing $50k to cover payroll with no offsetting revenue lift, an MCA will make the cash-flow hole deeper. In that case, a line of credit or SBA is the right call.

For more on how MCA pricing actually gets set, read factor rates explained, or see when an MCA is worth it.