Merchant cash advance calculator: see the true cost before you sign
Find out what an advance really costs: the total payback, the cash you actually receive, an approximate APR and how the payments fit your monthly deposits. Answer a few quick questions and we’ll email you a detailed report.
- About 2 minutes
- No credit check
- Free report by email
Check the cost of an offer
Have an offer? Use its numbers. Still shopping? Pick the closest options.
Your numbers update as you answer. Your report adds the APR, cash-flow fit and loan comparison.
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- Free, no obligation
Your emailed report includes
- Total payback, total cost and what you pay for every $1 you receive
- An educational APR estimate (not an official disclosure)
- How the payments fit your deposits, plus a 20% sales-drop test
- A side-by-side with SBA 7(a) loan rates and bank-loan benchmarks
- Questions to ask before you sign any offer
How to calculate the cost of a merchant cash advance
Advances are priced with a factor rate instead of an interest rate. These six building blocks are the same kinds of figures commercial financing disclosures typically cover, so you can compare any offer yourself. Only the written disclosure delivered with a specific offer is official.
Total payback
funding amount × factor rate$50,000 × 1.30 = $65,000
Cash you receive
funding amount − fees taken out at funding$50,000 − $1,250 (a 2.5% fee) = $48,750
Total cost
total payback − cash you receive$65,000 − $48,750 = $16,250. Upfront fees count as cost.
Payment
total payback ÷ number of payments$65,000 ÷ 126 business days = $515.87 a day
Share of deposits
monthly payments ÷ average monthly depositsAbout $10,833 a month ÷ $60,000 = 18.1%
Approximate APR
the yearly rate at which your payments equal the cash you receivedAbout 120% in this example. Repaying faster raises it.
Worked example: $50,000 at a 1.30 factor rate, 2.5% fee, 6 months
| Daily payments | Weekly payments | |
|---|---|---|
| Number of payments | 126 | 26 |
| Payment | $515.87 | $2,500.00 |
| Total payback | $65,000 | $65,000 |
| Cash you receive | $48,750 | $48,750 |
| Total cost | $16,250 | $16,250 |
| Approximate APR | 120.4% | 117.5% |
Assumes 21 business days a month and equal payments. APR uses the actuarial method in Regulation Z, Appendix J, which New York and California also use for the estimated APR on sales-based financing. This is an educational estimate, not a disclosure under any state or federal law.
Why the same factor rate can mean very different APRs
A factor rate is the total cost over the whole advance. An APR is a yearly rate, so the faster you repay, the higher it climbs. Here is a $50,000 advance at a 1.30 factor rate with no fees. The total cost is $15,000 in every column.
| Payback period | 3 months | 6 months | 9 months | 12 months | 18 months |
|---|---|---|---|---|---|
| APR, daily payments | 217% | 109% | 73% | 55% | 37% |
| APR, weekly payments | 207% | 107% | 72% | 54% | 36% |
Shortcuts like dividing the cost by the number of days understate the APR, because they ignore that you repay as you go. That’s why the calculator solves for the rate instead.
What to compare an offer against
A merchant cash advance buys speed and easier qualifying. These public figures show what that costs next to other financing.
| Benchmark | Rate or range | As of | Source |
|---|---|---|---|
| SBA 7(a) maximum variable rate, $50,000 or less | 13.50% | Oct. 2026 | U.S. SBA, prime + 6.5 |
| SBA 7(a) maximum variable rate, $50,001 to $250,000 | 13.00% | Oct. 2026 | U.S. SBA, prime + 6 |
| SBA 7(a) maximum variable rate, $250,001 to $350,000 | 11.50% | Oct. 2026 | U.S. SBA, prime + 4.5 |
| SBA 7(a) maximum variable rate, over $350,000 | 10.00% | Oct. 2026 | U.S. SBA, prime + 3 |
| Median rate on banks’ new small-business term loans | 6.7% to 7.0% | Q2 2026 | Kansas City Fed |
| Average short-term loan rate owners reported | 8.2% | Sept. 2026 | NFIB |
| Merchant cash advance factor rates | About 1.10 to 1.50 | 2026 | Federal Reserve research and industry surveys |
| Merchant cash advance cost as a share of the advance | Often 20% to 50% | — | FTC staff |
SBA maximums are based on the 7.00% prime rate in effect since September 17, 2026, and move when prime changes. Source: U.S. Small Business Administration.
Eight terms to read in any merchant cash advance offer
Two offers with the same factor rate can cost very different amounts once these terms kick in.
- ReconciliationIf payments are a fixed daily or weekly amount, can you ask to lower them when sales drop? How often, with what documents and how fast?
- Early payoffIs there a discount for paying the balance early, or does the full payback come due either way?
- FeesWhich fees come out at funding, such as origination or underwriting, and which recur, such as ACH or monthly fees?
- RenewalsIf new funding pays off an old balance, are you charged again on the part you hadn’t repaid yet?
- StackingDoes the contract forbid other financing while it’s open, and what happens if you take some?
- SecurityIs there a UCC lien, a personal guarantee or a confession of judgment?
- DisputesDoes the contract require arbitration, and where would a dispute be heard?
- DisclosuresNew York, Utah, Virginia, Georgia, Florida, Texas and other states require funders to disclose costs before you sign. Ask for that disclosure.
Merchant cash advance calculator questions
How do you calculate the cost of a merchant cash advance?
Multiply the funding amount by the factor rate to get the total payback. Then subtract the cash you actually receive, which is the funding amount minus any fees taken out at funding. What’s left is the total cost. For example, $50,000 at a 1.30 factor rate is $65,000 in payback; with a $1,250 fee taken out, you receive $48,750, so the advance costs $16,250.
How do I convert a factor rate to an APR?
You need more than the factor rate. The APR depends on how much cash you receive, how many payments you make and how often. The calculator solves for the yearly rate at which your payments equal the cash you received, using the actuarial method from Regulation Z, Appendix J, the same method New York and California use for the estimated APR on sales-based financing.
Why is the APR so much higher than the factor rate?
A factor rate is the total cost for the whole advance, no matter how long it lasts. An APR is a yearly rate. Because most advances are repaid in months, and you start repaying right away, the yearly rate is far higher. A 1.30 factor rate repaid daily over 6 months works out to an APR of about 109%.
What is a good factor rate for a merchant cash advance?
Most merchant cash advances are priced at factor rates of about 1.10 to 1.50. Lower is better, but compare offers by total cost, the cash you actually receive and whether the payments fit your deposits. Your rate depends on your revenue, time in business, credit and industry, and each funder sets its own price.
How is the daily payment on a merchant cash advance calculated?
For a fixed daily payment, divide the total payback by the number of business-day payments. A $65,000 payback over 126 business days is about $515.87 a day. If your advance takes a percentage of card sales instead, the payment is that percentage of each day’s sales, so it rises and falls with your sales.
Does using the calculator affect my credit?
No. The calculator only does math on the numbers you enter. It doesn’t pull your credit or submit an application. If you ask to talk with an advisor, checking your options still doesn’t involve a hard credit inquiry.
Is the report an offer of financing?
No. The report shows estimates based on your numbers so you can compare offers. Funders set their own approval criteria, prices and terms, and the APR in a funder’s disclosure may differ from this estimate, especially on short terms.
What happens after I submit the calculator?
We email your detailed report to the address you entered, usually within a few minutes. If you chose to talk with an advisor, a Funding Today advisor will contact you during business hours. If you chose report only, we won’t call you.
Let us shop it against other funders
One application reaches multiple funders, and it costs nothing to apply. Bring your numbers and we’ll show you how they stack up.
Sources and methodology
- Regulation Z, Appendix J: annual percentage rate computations
- New York 23 NYCRR Part 600: commercial finance disclosures
- Texas Finance Code chapter 398: commercial sales-based financing
- Federal Reserve: Uncertain Terms, what small-business borrowers find online
- Federal Trade Commission staff perspective: Strictly Business forum
- Federal Reserve Bank of Kansas City: Small Business Lending Survey, Q2 2026
- NFIB Small Business Economic Trends, September 2026
- U.S. Small Business Administration: 7(a) loans
The calculator assumes equal payments, 21 business days a month and 52 weeks a year. Its approximate APR solves for the actuarial rate and is accurate to within a few hundredths of a point of an exact calculation. Results are estimates for comparison only, not an offer of financing. Funding Today is a business funding broker, not a lender.