RBF vs MCA
Revenue-based financing vs merchant cash advances for US businesses
Revenue-Based Financing at 1%–18% (discount fee) against Merchant Cash Advances at 15%–40% (factor fee), compared across 37 US providers on cost, term, speed, and eligibility.
For US businesses with recurring or card-based revenue comparing two revenue-linked structures.
| Dimension | Revenue-Based Financing | Merchant Cash Advances |
|---|---|---|
| Published cost | 1%–18% | 15%–40% |
| What the cost measures | Discount fee | Factor fee |
| Typical term | 0 months to 2 years | 3–18 months |
| Fastest published funding | Same day | 24 hours |
| Lowest published FICO minimum | Not published | 600 |
| Median published revenue floor | $120,000 | $120,000 |
| Shortest published trading history | 3 months | 4 months |
| Providers compared | 17 | 20 |
| Provider | Product | Published cost | What it measures | Term | Funding speed | Published criteria |
|---|---|---|---|---|---|---|
| Payability | Revenue-Based Financing | 1%–2% | Discount fee | 1–7 days | Same day | Requires at least 3 months in business. |
| PayPal Working Capital | Revenue-Based Financing | 1%–12% | Discount fee | Auto | 24 hours | Requires $15,000+ in annual revenue and an existing PayPal biz business banking relationship. |
| Settle | Revenue-Based Financing | 1%–6% | Discount fee | 30–120 days | 24–48 hours | Published criteria do not state a minimum revenue, trading history, or credit score. |
| Wayflyer | Revenue-Based Financing | 2%–8% | Discount fee | 6–12 months | 24–72 hours | Requires $240,000+ in annual revenue. |
| 8fig | Revenue-Based Financing | 4%–10% | Discount fee | 6–12 months | 48 hours | Requires $100,000+ in annual revenue. |
| Stripe Capital | Revenue-Based Financing | 4%–8% | Discount fee | Auto | 1–2 business days | Requires an existing Stripe business banking relationship. |
| Viably | Revenue-Based Financing | 5%–12% | Discount fee | Variable | 1–3 business days | Published criteria do not state a minimum revenue, trading history, or credit score. |
| Amazon Lending | Revenue-Based Financing | 6%–16% | Discount fee | 12 months | 1–5 business days | Published criteria do not state a minimum revenue, trading history, or credit score. |
| Bitty Advance | Merchant Cash Advances | 15%–30% | Factor fee | 3–12 months | 24–48 hours | Requires at least 4 months in business and $60,000+ in annual revenue. |
| Credibly | Merchant Cash Advances | 15%–35% | Factor fee | 6–15 months | 24–48 hours | Requires at least 6 months in business and $180,000+ in annual revenue. |
| Fora Financial | Merchant Cash Advances | 15%–35% | Factor fee | 4–15 months | 24–48 hours | Requires at least 6 months in business and $180,000+ in annual revenue. |
| Libertas Funding | Merchant Cash Advances | 15%–32% | Factor fee | 6–18 months | 48 hours to 1 week | Requires at least 2 years in business and $600,000+ in annual revenue. |
| Mulligan Funding | Merchant Cash Advances | 15%–35% | Factor fee | 4–18 months | 24–48 hours | Requires at least 1 year in business and $120,000+ in annual revenue. |
| Rapid Finance | Merchant Cash Advances | 15%–38% | Factor fee | 3–18 months | 24–48 hours | Requires at least 1 year in business and $120,000+ in annual revenue. |
| Fundkite | Merchant Cash Advances | 18%–38% | Factor fee | 3–15 months | 24–48 hours | Requires at least 6 months in business and $120,000+ in annual revenue. |
| Headway Capital MCA | Merchant Cash Advances | 18%–35% | Factor fee | 4–15 months | 24–48 hours | Requires at least 1 year in business, $50,000+ in annual revenue and a 600+ FICO score. |
These costs are quoted on different bases and are not directly comparable
- Discount fee
- Charged per invoice or trade cycle rather than per year. A fee that looks small can annualise into a much larger number when cycles repeat through the year.
- Factor fee
- A fee on the total advanced, not an annual rate. Because it is charged in full over a repayment period shorter than a year, the equivalent annualised cost is materially higher than the number shown.
What actually separates them
Both repay as a share of income rather than on a fixed schedule, which is why they are often conflated. The practical differences are in what they are priced against, how long they run, and which businesses they are built for. Revenue-based facilities are generally aimed at recurring-revenue businesses and priced as a fee on the advance repaid over a defined period; merchant cash advances are aimed at card and point-of-sale revenue and repaid as a share of daily receipts.
Repayment velocity is the difference that matters operationally. A structure that takes a percentage of daily card receipts withdraws cash continuously, while one that remits monthly against subscription revenue leaves the operating account intact between payments. Two facilities with similar published fees can put very different pressure on working capital.
- Revenue-Based Financing: 1%–18% (discount fee)
- Merchant Cash Advances: 15%–40% (factor fee)
- Revenue-Based Financing term: 0 months to 2 years
- Merchant Cash Advances term: 3–18 months
Why the headline numbers cannot be compared directly
The two products are quoted on different bases, which is the most common source of error when businesses weigh them against each other. The cost of revenue-based financing is quoted as a discount fee: Charged per invoice or trade cycle rather than per year. A fee that looks small can annualise into a much larger number when cycles repeat through the year. The cost of merchant cash advances is quoted as a factor fee: A fee on the total advanced, not an annual rate. Because it is charged in full over a repayment period shorter than a year, the equivalent annualised cost is materially higher than the number shown.
Set side by side without that context, 1%–18% and 15%–40% appear to be the same kind of quantity. They are not. Converting either into a comparable annualised figure requires the drawn amount, the actual repayment period, and the full fee schedule — none of which appear in a published range. Any comparison that skips this step will reach a confident conclusion that happens to be wrong.
- Discount fee: Charged per invoice or trade cycle rather than per year. A fee that looks small can annualise into a much larger number when cycles repeat through the year.
- Factor fee: A fee on the total advanced, not an annual rate. Because it is charged in full over a repayment period shorter than a year, the equivalent annualised cost is materially higher than the number shown.
When each one fits
Revenue-based financing tends to fit businesses with predictable recurring revenue — subscription, contracted, or platform-based — where the provider can underwrite against a stable forward run rate and repayment can be scheduled against it.
A merchant cash advance tends to fit businesses whose revenue arrives as high-frequency card or platform receipts, where there is no contracted forward revenue to underwrite and speed is the priority.
Before choosing between them
For both, the published fee is charged on the advance and repaid over a period well short of a year, so the annualised cost is materially higher than the headline figure. Model the effect on weekly operating cash, not just the total repaid.
Caplift's assessment compares structures on a consistent basis using the business's own figures rather than published ranges, and produces a readiness view alongside it. Caplift is not a lender and does not approve, originate, or guarantee financing — the decision remains with the business and its advisors.
Common questions
Questions businesses ask
Is revenue-based financing cheaper than merchant cash advances?
The published figures — 1%–18% for revenue-based financing and 15%–40% for merchant cash advances — are quoted on different bases and cannot be compared directly. Discount fee and factor fee measure different things over different periods, so the smaller number is not reliably the cheaper facility.
Which funds faster, revenue-based financing or merchant cash advances?
The fastest published timeline is same day for revenue-based financing and 24 hours for merchant cash advances. Published timelines assume a complete file and exclude the preparation time before submission, which is usually the larger part of the calendar.
Which has easier eligibility requirements?
Across the providers compared here, the lowest published FICO minimum is not published for revenue-based financing and 600 for merchant cash advances. Published minimums gate consideration only — approval depends on the whole file, and an easier published threshold usually corresponds to a higher cost or a tighter structure elsewhere.
Does Caplift lend or earn a fee from either product?
No. Caplift Financial Inc. is software and is not a lender. Providers are compared from published information, inclusion is not an endorsement, and appearing here does not indicate a commercial relationship with Caplift.
About this data, and its limits
- Figures are drawn from Caplift's Q1 2026 lender catalogue review and are indicative, not quotes. Curated from named US lenders; confirm individual terms before relying on them.
- Compared across 17 revenue-based financing providers and 20 merchant cash advances providers that publish indicative pricing. The provider table below shows the lowest-cost eight from each product; the full sets appear on the individual product guides.
- Inclusion is not an endorsement, a recommendation, or an offer, and does not indicate a commercial relationship with Caplift. Pricing and criteria change without notice — confirm current terms directly with the provider before relying on them.
- Caplift compiles this information to the best of its ability from publicly available provider material, but does not guarantee that it is accurate, complete, or current, and accepts no liability for decisions made in reliance on it. Figures may be out of date or incorrect. Verify anything you intend to act on directly with the provider.
- Caplift Financial Inc. is not a lender and does not approve, originate, or guarantee financing. Nothing on this page is legal, financial, tax, accounting, or investment advice, and it should not be treated as a substitute for advice from a qualified professional who knows your circumstances.