Merchant Cash Advance Calculator: How Much Does an MCA Really Cost?

person typing on a calculator and a laptop

Last Updated February 27, 2023

A merchant cash advance is a small business financing option that provides quick funding but often comes at a high cost. We’ve put together a calculator to help you better understand how long it may take to pay off an MCA and how much it may cost.

How to Use the Merchant Cash Advance (MCA) Calculator

The MCA calculator helps small business owners better understand the costs associated with taking out a merchant cash advance. To use altLINE’s merchant cash advance calculator, input the following values and then click the “Calculate” button:

  • Merchant Cash Advance Amount: This is the advance amount you expect to receive from an MCA lender.
  • Factor Rate: Similar to an interest rate, this determines how much the merchant cash advance will cost. The factor rate is typically between 1.2 and 1.5.
  • Holdback Rate: This percentage determines how much of each credit/debit card transaction the MCA provider will take until the purchased amount is repaid.
  • Estimated Monthly Credit/Debit Card Sales: This is an estimation of how many credit/debit card sales your business expects to do in a month and is used to estimate how long it will take to repay the loan and your daily payment amount.

Once you click the “Calculate” button, you will receive the following outputs:

  • Total Payback Amount: This is how much you can expect to repay the MCA lender (excluding additional fees).
  • Approximate Days to Repay: This is an estimation of how long it will take you to pay off the total payback amount.
  • Approximate Daily Payment: This is an estimation of how much you can expect to pay the MCA lender each day; however, it is important to note that because the holdback rate is typically a percentage of your credit/debit card sales, the daily payment will fluctuate.