Most merchant cash advance requirements come down to a few basics: a business bank account showing steady deposits or card sales, some time in business, recent bank statements, a government-issued ID, and a credit score that usually carries less weight than it would for a bank loan. Because a merchant cash advance gives you funds in exchange for a share of your future revenue, typically collected through daily withdrawals from your business bank account, funders care most about how consistently money comes in. Some providers, including Funding Today, offer options for credit scores as low as 500, with no hard credit inquiry to check them.
If you’re weighing an advance, you’re not the only one. In the Federal Reserve’s latest survey of employer firms, 8% reported applying for a merchant cash advance in the prior 12 months, often alongside loans and lines of credit. Being able to qualify, though, doesn’t mean an advance is the right fit for your business.
Below, we walk through what funders check: time in business and monthly deposits, the documents to have ready, and how credit scores and soft versus hard inquiries work. We also explain how to figure out the true cost using the factor rate, total payback, daily remittance and effective APR. Then we compare MCA requirements with term loans, lines of credit and SBA loans, point out red flags to watch for before you sign, and suggest a low-pressure way to see your options.
The short answer: what merchant cash advance funders check
Most merchant cash advance funders focus on how money moves through your business more than on your personal credit history. Before you apply, check whether you can show the following:
- Time in business: how long the business has been operating and bringing in revenue.
- Steady monthly deposits: regular income landing in your account month after month, not one-time spikes.
- Card sales volume: how much you take in through credit and debit card payments, if you accept them.
- Recent business bank statements: these show your deposit history and average balances.
- Government-issued ID: to confirm who owns the business and who is signing.
- A business bank account: the account where your deposits come in and where payments are usually collected.
Why revenue comes first
A merchant cash advance works differently from a traditional loan. As the Federal Trade Commission describes it, MCA providers fund a business in exchange for a share of its future revenue, usually collected through daily withdrawals from the business bank account. Because repayment comes straight from your incoming sales, funders want to see a consistent pattern of deposits that can support those withdrawals. Your bank statements show that pattern.
Meeting the checklist is a starting point, not a promise
Having every item on this list does not guarantee approval. Each funder sets its own criteria, including how long you need to have been in business, how much monthly revenue it expects and how it weighs credit. Two funders can look at the same file and reach different decisions or offer very different terms.
Funding Today works with small businesses in every state except California. The sections below cover each requirement in more detail, along with how to judge whether an offer makes sense for your business.
Time in business and steady monthly deposits
Funders mainly want to know two things: has your business been operating long enough to show a pattern, and does money come in steadily? The reason is how repayment works. A merchant cash advance is funding provided in exchange for a share of future revenue, usually collected through daily withdrawals from your bank account. So the funder is really asking whether your sales arrive often enough to cover a daily or weekly remittance without draining your account.
Minimums for time in business and monthly revenue vary from funder to funder. No single number applies everywhere. Across all of them, though, consistency counts for more than one big month. Six ordinary months of similar deposits usually tell a clearer story than one record month surrounded by thin ones.
What can look like a warning sign on your statements
- Frequent negative balances: These suggest there may not be room for an added daily withdrawal.
- Repeated overdrafts or returned items: These can signal that cash flow is already stretched.
- Deposits that suddenly drop: A sharp fall raises questions about where revenue is heading.
None of these automatically rules you out. If there’s a reason behind them, such as a one-time equipment repair or a delayed customer payment, be ready to explain it briefly.
If your business is seasonal
Landscapers, tax preparers, holiday retailers and tourist-area shops naturally have strong months and slow months. Don’t hope the dips go unnoticed. Explain your cycle up front: which months are busy, which are slow, and how you’ve covered expenses in past off-seasons. A predictable seasonal pattern is easier to plan around than unexplained swings. It also helps you ask a practical question for your own protection: could you handle the remittance during your slowest stretch, not just your best one?
Documents for a merchant cash advance: bank statements, card sales and ID
Most merchant cash advance files are short. Funders want to see how money moves through your business and who owns it. The exact list varies by funder, but a typical file includes:
- Recent business bank statements: These show your deposits, balances and how steady your revenue is from month to month.
- Card processing statements: If you accept credit or debit cards, these show your card sales volume.
- Government-issued photo ID: For each owner, to confirm identity.
- Your EIN and basic ownership details: Who owns the business and what share each owner holds.
Why a business bank account matters
Your bank statements are the core of an MCA review, so they need to belong to the business. The U.S. Small Business Administration advises opening a business bank account as soon as your business starts accepting or spending money. You can open one once the business has an Employer Identification Number (EIN). The same SBA guidance notes that a merchant services account lets a business accept credit and debit card payments. That account is where your card volume shows up, and it is the record funders look at when they review card sales.
Why mixing personal and business money makes underwriting harder
When personal and business transactions share one account, a funder can’t easily tell which deposits are real business revenue. Grocery runs, transfers from a spouse or personal refunds can blur the picture. That may lead the funder to discount some deposits, ask for more documents or take longer to decide. Clean business statements make your revenue easier to verify. They also make it easier for you to judge whether a daily or weekly payment fits your actual cash flow.
Practical tip: Before you apply, download your statements as PDFs straight from your bank or processor. Make sure every page is included and readable.
Credit score for a merchant cash advance and soft vs. hard inquiries
Your credit score matters, but for a merchant cash advance it is usually one factor among several. Because an advance is repaid from a share of your future sales, many funders look first at your recent deposits and card volume. A thin or bruised credit history does not always rule you out, and a strong score does not guarantee an offer.
How checking your options can affect your credit
The Consumer Financial Protection Bureau explains the two types of credit inquiries:
| Inquiry type | When it happens | Effect on your score |
|---|---|---|
| Soft inquiry | Includes prescreening by prospective lenders | Does not affect credit scores |
| Hard inquiry | Comes from applying for credit | Can affect scores and is visible to others who pull your report |
If you are comparing several providers, this difference adds up. A soft check lets you see where you stand without adding hard inquiries to your report.
What Funding Today checks
Funding Today says it has options for credit scores as low as 500 and does not run a hard credit inquiry to check your options. That means looking costs your score nothing, but it is not an approval. Whether you receive an offer, and on what terms, still depends on your revenue, deposit history and the funder’s review. Before you share details, you can read how Funding Today handles the information you submit.
Ask before you authorize
With any provider, ask one plain question before you sign a consent form: “Will you run a soft or hard credit check, and at what stage?” Some providers start with a soft check and run a hard one only later, before final funding. Get the answer in writing so you know exactly what you are agreeing to.
Qualifying is not the same as affording it: check the true cost
Getting approved only means a funder is willing to advance money. The more important question is whether your daily cash flow can cover the payback and still pay your bills. Before you sign, make sure you understand these four figures.
| Term | What it means in plain words | Why it matters |
|---|---|---|
| Factor rate | A multiplier applied to the amount you receive. It sets the total you owe. | It is not an interest rate, so it can look smaller than the real cost. |
| Total payback | The advance amount multiplied by the factor rate, plus any fees. | This is the full dollar amount that will leave your account. |
| Daily remittance | The amount collected from your bank account each business day, either a fixed sum or a share of sales. | It comes out on slow days too, so test it against your weakest weeks. |
| Effective APR | The total cost expressed as a yearly rate, based on how quickly you repay. | A faster payback on the same fee means a higher APR. This figure lets you compare an MCA with a loan. |
Get every one of these numbers in writing. In one case, the FTC alleged that a merchant cash advance operator misrepresented its terms and fees to small businesses and took more money from their accounts than they had agreed to. A written breakdown gives you something concrete to check against your contract and your bank statements.
Next, estimate your payback and daily remittance with our merchant cash advance calculator. Use your own recent deposits, not your best month. If the daily amount would leave you short on payroll or rent, consider a smaller advance or a different product.
Finally, compare the effective cost with the term loans and lines of credit you may qualify for. An MCA can make sense when speed matters most. Choose it because the numbers work for your business, not because it was the first offer you received.
How MCA requirements compare with loans, lines of credit and SBA loans
A merchant cash advance is one option among several, and most business owners who seek financing look beyond MCAs. In the Federal Reserve’s 2025 Small Business Credit Survey, 38% of employer firms applied for a loan, line of credit or merchant cash advance in the prior 12 months. When MCAs were reported separately, 8% of employer firms had applied for one. The same survey found that applicants went to large banks most often, followed by online lenders and small banks.
The survey also found that the share of applicants who were fully approved stayed below prepandemic levels. Whichever product you choose, approval is never a sure thing. Each lender or funder sets its own standards, and a strong application for one product may not fit another.
What to compare across your options
Before deciding where to apply, compare these four points side by side:
- What the lender reviews: MCA funders tend to focus on your recent deposits and card sales. Term loans, lines of credit and SBA loans may weigh other factors as well.
- Paperwork: Ask each bank or SBA lender for a complete document list up front. Their requirements can differ a lot from an MCA’s bank-statement review.
- Timeline: Ask how long a decision and funding typically take. If your need is not urgent, a slower option with a lower cost may be worth the wait.
- Repayment structure: Check whether you would pay fixed monthly installments, draw and repay a revolving line, or remit a share of revenue.
Matching the product to your timeline and cash flow matters more than which one is easiest to qualify for. For side-by-side breakdowns of cost and structure, see our funding guides comparing MCAs, term loans and lines of credit.
Red flags to watch for before you sign
Most funders deal with business owners honestly, but there are documented exceptions. Knowing the warning signs makes it easier to spot an offer you should walk away from.
What the FTC found in one case
In 2022, the Federal Trade Commission announced that Richmond Capital Group (RCG Advances) and its owner were banned from the merchant cash advance and debt collection industries. According to the FTC, the company:
- Misrepresented terms and fees, so owners received less or paid more than they were led to expect.
- Took money from business accounts beyond what owners had agreed to.
- Threatened owners who could not keep up with payments.
You can use these as a checklist. If a funder’s numbers keep shifting, its answers are vague, or its tone turns aggressive, take that seriously.
Questions to ask directly
- Personal guarantee: Am I personally on the hook if the business can’t pay? Under what circumstances?
- Fees: What fees come out of the advance or get added later? What is the net amount that will reach my account?
- Remittance: What is the exact daily or weekly debit, and can it change if my sales drop?
- Payoff: How and when do debits stop once the balance is paid? Who confirms that it has been paid?
A reputable funder will put these answers in writing.
Read the full agreement first
Read every page before you sign, including the default and collection sections. If something is unclear, ask about it and wait until you get an answer you understand. It’s reasonable to have your accountant or attorney review the contract. A legitimate offer should still be available after a careful review.
A low-pressure next step: see your options
If you’ve checked your numbers and an advance still makes sense for your business, you can see what may be available without much time or commitment. Funding Today offers merchant cash advances from $10,000 to $2,000,000, with funding as soon as 24 hours after signing and an online application you can fill out any time, day or night.
What to expect when you check
- No hard credit inquiry to see options: Funding Today states that checking your options does not involve a hard credit inquiry.
- Options for a range of credit profiles: Funding Today lists options for scores as low as 500.
- No promises up front: Approval, the amount offered, the factor rate and the remittance schedule all depend on your business’s information. None of them are guaranteed.
- Availability: Funding Today serves businesses in every state except California. If your business is based in California, this option isn’t available to you.
Read the fine print first
Before you apply, take a few minutes to read Funding Today’s terms and conditions. If you receive an offer, compare its total payback, holdback percentage and daily or weekly remittance against the other options you’re considering. Only accept it if the payments fit comfortably within your normal deposits. You can decline any offer that doesn’t fit, and you can ask questions before you sign.
Ready to look? See your funding options with a no-cost application at funding-today.com or call (833) 632-3050. You can review what comes back and decide on your own timeline.
Frequently asked questions
What credit score do I need for a merchant cash advance?
There’s no single cutoff across the industry. Each funder sets its own guidelines. At Funding Today, there are options for credit scores as low as 500. Funders usually look more closely at the health of your business revenue than at your score alone.
A lower score can still affect the terms you’re offered. Before accepting any offer, compare the total payback and the size of each remittance against your actual cash flow.
Will checking my merchant cash advance options hurt my credit?
Checking your options with a soft inquiry doesn’t hurt your score. According to the Consumer Financial Protection Bureau, soft inquiries, including prescreening by prospective lenders, do not affect credit scores. Hard inquiries come from credit applications. They can affect your score, and others who pull your report can see them.
Funding Today doesn’t run a hard credit inquiry to check your options. If you’re curious, you can see your funding options with a no-cost application at funding-today.com or call (833) 632-3050.
What documents do I need for a merchant cash advance?
Expect to be asked for recent business bank statements, a government-issued ID and basic details about your business. If you take cards, statements from your card processor help show your sales volume. The SBA notes that merchant services accounts let a business accept credit and debit card payments, and that a business bank account can be opened once you have an EIN.
Having these documents ready ahead of time can make the review go more smoothly.
Do I need a business bank account to get a merchant cash advance?
In practice, yes. Funders review your deposit history to judge your revenue, and repayment is typically drawn from the account where your sales land. A dedicated business account makes that history clear and keeps your personal money separate.
The SBA guidance linked above recommends opening a business account as soon as your business accepts or spends money. If you’ve been running sales through a personal account, consider switching before you apply.
How is a merchant cash advance repaid?
A merchant cash advance isn’t repaid in fixed monthly installments like a typical loan. As the Federal Trade Commission describes it, the funder provides money in exchange for a share of your future revenue, usually collected through daily withdrawals from your bank account.
Before you sign, find out the total payback amount, how much each withdrawal will be and how often withdrawals happen. Then make sure your account can handle those withdrawals on slower days.
Sources
- 2026 Report on Employer Firms: Findings from the 2025 Small Business Credit Survey · Federal Reserve Banks · 2026-03-03
- FTC Action Results in Ban for Richmond Capital and Owner From Merchant Cash Advance and Debt Collection Industries · Federal Trade Commission · 2022-06-01
- What is a credit inquiry? · Consumer Financial Protection Bureau
- Open a business bank account · U.S. Small Business Administration
- Funding Today: Merchant Cash Advances · Funding Today
This article is general information, not legal advice. Laws and deadlines vary by state and change over time; check the linked sources or speak with a licensed attorney about your situation.
