Merchant Cash Advance Calculator
A merchant cash advance is priced with a factor rate, not an interest rate. See what you repay in total, the daily or weekly payment, how long it should take, and an estimated APR so you can compare it fairly with a loan.
Often between 1.1 and 1.5. A factor rate of 1.3 means you repay $1.30 for every $1 advanced.
The share of each day's card sales that goes to repayment.
An estimate for planning only, not an offer of credit. Your actual rate, terms and payment depend on your business and the lender. Nothing you enter is saved or sent.
See your real numbersYear-by-year breakdown
| Year | Balance paid | Interest paid | Balance left |
|---|
Example
A $50,000 advance at a factor rate of 1.3 means repaying $65,000, so it costs $15,000. Paid back over about eight months in 168 business-day payments of about $387, that works out to an estimated APR of about 82%. The factor rate looks like 30%, but because you repay quickly, from the first day, the yearly cost is much higher.
Factor rate vs APR
A factor rate is a fixed multiple of the advance. It does not shrink as you repay, and the whole cost is due however fast you pay. An APR is a yearly rate on the balance you still owe. That is why a factor rate of 1.3 is not the same as 30% a year: if you repay in eight months, starting the next business day, the yearly equivalent is far higher. The calculator works out that estimated APR so you can compare an advance with a loan or line of credit.
Fixed payments or a holdback
Some advances take a fixed amount every business day or week. Others take a set share of your card sales, the holdback, so you pay more on busy days and less on slow ones. With a holdback, the faster your sales, the sooner it is repaid, and the higher the estimated APR.
When an advance can make sense
An advance is fast and is based on your sales rather than your credit score, which can help when you need money quickly or a bank has said no. Because it usually costs more than a loan, compare the total cost first. Learn more on our merchant cash advances page, or compare with the business loan calculator.
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Frequently asked questions
How do I calculate a merchant cash advance payback?
Multiply the advance by the factor rate. A $50,000 advance at 1.3 is repaid as $65,000, so the cost is $15,000.
How do I convert a factor rate to an APR?
The APR depends on how long repayment takes. The calculator finds the yearly rate at which your daily or weekly payments would repay the advance. The shorter the period, the higher the APR for the same factor rate.
What is a holdback?
The share of your daily card sales that goes to repaying the advance, often 10% to 20%. Payments go up on busy days and down on slow days.
Can I pay off a merchant cash advance early to save money?
Often not. The factor rate fixes the total cost, so paying early may not reduce it unless the agreement includes an early payoff discount. Ask before you sign.
This calculator gives estimates for planning only. It is not an offer of credit, and the results are not financial advice.
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