If your business does at least $10,000 a month in deposits, you can find an MCA funder. Below that, the funder pool shrinks fast — most won't write the deal at any factor.
$25,000 a month is where the standard funders start to engage. $50,000 a month opens the Tier 1 pool. Above $100,000 a month, you have access to the strongest factor rates and the largest advance sizes.
What "revenue" actually means in MCA underwriting
Funders don't look at your accountant's revenue figure or your tax return top-line. They look at monthly bank deposits — the total of credits hitting your business operating account each month, with a few items stripped out:
- Inter-account transfers between your own accounts get backed out.
- Loan or advance proceeds from another funder don't count.
- Refunds and chargebacks reversed in are netted to zero.
- Returned items get backed out of the deposit total.
The functional revenue number is usually 10-20% lower than the raw "credits" line at the top of your statement. Plan accordingly when you're sizing what you can ask for.
Revenue tier breakdown
Here's how funders categorize files by monthly revenue:
- $8K–$10K/month: very tight. A small handful of specialty funders will look. Factor rates 1.45+, advance capped at $15,000.
- $10K–$25K/month: Tier 3 zone. Standard funders engage. Factor rates 1.35-1.45, advance typically capped at $30,000.
- $25K–$50K/month: Tier 2 zone. Most funders compete for the file. Factor 1.30-1.40. Advance up to $60,000-$75,000 typical.
- $50K–$150K/month: Tier 1 zone. Best factor rates available (1.25-1.35). Advance up to 1x of monthly revenue typical.
- $150K+/month: Premium zone. Largest advances ($250K-$2M), best factor rates. Senior underwriter looks at the file.
The advance-to-revenue ratio
The math underwriters run is: how much daily payment can the merchant absorb without defaulting? They size the advance so the daily debit lands at roughly 8-12% of average daily deposits.
Concrete example: $50K/month in deposits is about $2,300 per business day. A 10% holdback equivalent is $230/day. At a 1.30 factor over 7 months (~150 business days), that's a $34,500 payback, or a $26,500 advance. Round numbers, but that's the math.
What if revenue is below $10K/month
Three honest options:
- Wait 60-90 days and grow into eligibility. If your revenue is climbing, two more months of higher deposits can flip you from declined to standard zone.
- Look at non-MCA products. SBA microloan up to $50K, online term loan, equipment financing, business credit card. Different products have different floors.
- Combine accounts. If you run multiple business accounts and your $7K/month is just from one, consolidating to a single operating account can show $15K+/month consistent.
The mistake to avoid: don't apply at $7K/month against your better judgment. Multiple declines on a low-revenue file create UCC-record noise that hurts you when you do qualify in 90 days.
Sources & References
- Bank denial and small business credit access figures cited in this piece are derived from the Federal Reserve Small Business Credit Survey. Approval rates for small business credit applications at large banks have ranged from approximately 13%-31% across recent survey years, depending on bank category and reporting period.
- Small business finance landscape and lending program data: SBA Office of Advocacy.
- Merchant cash advance industry standards and disclosure practices: Small Business Finance Association (SBFA).
- Commercial financing disclosure regulations referenced (NY FAIR Act, CA SB 1235/666/362, VA, UT) are summarized from the published statutes; consult counsel for specific compliance application.