MCAs are neither saviors nor villains. They’re tools. Powerful ones. Dangerous ones if misunderstood.
Advantages
- Speed: Capital when banks say “come back in six weeks”
- Accessibility: Thin credit files? Prior issues? Still possible.
- Revenue-Based Repayment: Slower sales = smaller payments
- Use of Funds: No restrictions (marketing, payroll, inventory, repairs)
Disadvantages
- Cost: MCAs are expensive. Period.
- Cash Flow Pressure: Daily debits can sting
- Stacking Risk: Multiple MCAs can spiral fast
- No Early Payoff Discount (Often): You owe the purchased amount, not a balance
Hard truth:
MCAs solve short-term liquidity problems, not broken business models.
If you need an MCA to survive month after month, the problem isn’t financing—it’s margins, pricing, or operations.