MERCHANT CASH ADVANCES
Funding shaped around
your card sales.
Explore a merchant cash advance for your business, with repayments linked to an agreed share of your card sales. We’ll help you understand the options and the next steps.
PDQ Funding is a broker, not a lender. Funding is subject to assessment and terms.
BUSINESS FUNDING, EXPLAINED
What is a merchant
cash advance?
A merchant cash advance, also called a business cash advance, is an alternative funding option for businesses accepting debit and credit card payments. It provides an upfront sum for business needs such as stock, equipment, refurbishment, development or working capital.
Sometimes searched for as a “merchant loan”, it works differently from a conventional business loan: repayments are linked to an agreed share of future card sales, rather than simply a fixed monthly instalment. The exact payment arrangements are set by the lender.
As eligible card sales rise or fall, the amount collected changes. This may help align repayments with seasonal trade, but it does not remove cash-flow pressure or the need to understand the full commitment.
ILLUSTRATIVE EXAMPLE
A £100 card sale.
With an agreed repayment percentage of 10%:
- Card payment
- £100
- Repayment to the lender
- £10
- Remaining for your business*
- £90
Illustration only, not an offer. The 10% is a share of sales, not an interest rate. Actual costs and terms depend on the lender. *Before card-processing fees.
YOUR NEXT BUSINESS STEP
What could the funding support?
Stock & supplies
Plan for stock purchases or a seasonal increase in demand.
Equipment
Explore funding for machinery, tools or business equipment.
Premises
Consider improvements to your shop, salon or workspace.
Working capital
Explore options for managing day-to-day business costs.
HOW MUCH CAN I BORROW?
Funding around your
business and card turnover.
Enquiries can be made for amounts from £5,000 to £300,000, subject to lender availability, assessment and your business circumstances. This is an indicative range, not a guaranteed offer.
The lender looks at your recent card sales, trading history, funding needs and existing commitments. An advance may be linked to average monthly card receipts; the percentage offered varies, so receiving 100% of a month’s card takings is not guaranteed.
We can discuss your needs in an initial conversation. Confirmation of the amount available follows the lender’s assessment, rather than a guaranteed one-hour decision.
What shapes an offer?
- Recent card turnover and consistency of sales
- How long your business has been trading
- The amount requested and intended use
- Existing finance and the lender’s criteria
A future top-up is a separate funding decision, not an automatic entitlement.
UNDERSTAND THE COMMITMENT
How much will it cost?
A cash advance is generally offered with an agreed total repayment amount. The factor rate is one way of expressing this total: multiplying the funding amount by the factor rate gives the illustrated repayment amount.
In this example, £27,000 × 1.28 = £34,560. The difference is £7,560, before any additional charges that might apply. A factor rate of 1.28 is not an APR or an annual interest rate.
The collection percentage determines how much is taken from card sales; it does not tell you the total cost. Compare the full amount repayable, likely repayment period, fees and obligations when considering alternatives.
The figures, explained.
ILLUSTRATIVE COST EXAMPLE
| Funding amount | £27,000 |
|---|---|
| Factor rate | 1.28 |
| Total repayment | £34,560 |
| Difference | £7,560 |
Illustration only, not an offer or representative rate. Confirm all fees, guarantees and repayment conditions in your individual agreement.
REASONS TO CONSIDER A CASH ADVANCE
Flexibility, with the details made clear.
Sales-linked repayments
Collections can rise and fall with card sales, which may suit seasonal businesses. The agreed percentage still reduces the income available for other costs.
A personal conversation
Discuss your plans with a point of contact. If a cash advance does not fit, we can explore whether another funding option may be more suitable.
Practical applications
Lenders often focus on trading and card-sales information. A detailed business plan may not be needed, but documentation requirements vary.
Clear next steps
Providing complete information helps the assessment progress. Decisions and release of funds depend on the lender; 24-hour approval or funding within 48 hours cannot be guaranteed.
COULD IT FIT YOUR BUSINESS?
How can I get a cash advance?
Sole traders, partnerships and limited companies can enquire. Merchant cash advances are designed for businesses that take regular card payments, with lenders reviewing recent sales and trading history.
As an initial guide, six months of trading and more than £5,000 in monthly card sales may be relevant to some lenders. These are not universal criteria or a promise of eligibility; requirements vary by provider and product.
The lender may ask for recent bank and card-sales statements to understand average turnover and existing commitments. PDQ Funding helps with the enquiry and introduction; the lender makes the decision.
Useful details for your enquiry
- Your business name and how long you’ve been trading
- Your average monthly card sales
- How much funding you need and what it’s for
- Recent bank and card-sales statements, if requested
THE PRACTICAL DETAILS
Repayments, security and future funding.
How are repayments collected?
For a card-sales-based arrangement, an agreed percentage is collected through the payment arrangements set up with the lender or card processor. Collections reduce the outstanding balance until the agreed total is paid. Check the agreement for collection frequency, settlement timing and any minimum-payment requirements.
What happens during quieter trading periods?
When collections are calculated as a percentage of card sales, lower sales produce a smaller collection and higher sales a larger one. This can change the time taken to repay. Do not assume a fixed repayment period or that all obligations stop if sales fall; review the lender’s terms.
Are cash sales and invoices included?
A card-sales-based arrangement usually collects from eligible card receipts. Cash takings and invoice payments are not the basis of that card-sales calculation, but other collection methods or obligations may apply under the agreement. Confirm the exact scope with the lender.
Is it unsecured or free of personal guarantees?
Some cash advances are described as unsecured because they do not require a charge over a specific business asset. That does not automatically mean there is no personal guarantee or other obligation. Check all security and guarantee terms before accepting.
Can I get a top-up?
Some lenders may consider additional funding after part of an advance has been repaid. A top-up is not automatically available after four months; it depends on trading, repayment history and a fresh assessment. Review the new total cost and commitments.
How long does repayment take, and can I track it?
The repayment period depends on the product, sales performance and agreement. Any estimate, including a period of up to 24 months, should be confirmed by the lender. Some providers offer an online account to track collections and the outstanding balance; availability varies.
HOW TO GET STARTED
From your enquiry to a lender decision.
01
Send your enquiry
Tell us about your business and the amount you need using our online form.
02
Discuss the options
We review your enquiry, explain the next steps and introduce you to a lender where appropriate.
03
Review the terms
The lender assesses your information. If there is an offer, review the amount, costs and obligations.
04
Decide and proceed
If you accept and checks are complete, the lender arranges funding and the agreed repayment setup.
UK BUSINESS FUNDING · PDQ FUNDING
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your next business step?
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PDQ Funding is a broker, not a lender. Funding is subject to the lender’s assessment and terms.