CAPITAL · WORKING CAPITAL
MCA & Working Capital
Merchant cash advance (MCA) is a short-duration, revenue-based financing product for operators whose deposit history is stronger than their tax returns. It is faster and more accessible than a bank line — and meaningfully more expensive. We place MCA when the timing and math work, and we tell clients honestly when they should wait for an LOC instead.
How we work this product
Factor rate, holdback percentage, and total cost of capital are disclosed in writing before the client signs any offer. We will not process a deal until the operator has confirmed they understand the effective annualized cost and the repayment mechanics. This is both our policy and, in several states (CA, NY, UT, VA), a legal requirement we comply with uniformly across all jurisdictions.
Typical terms
| Parameter | Typical range |
|---|---|
| Advance size | $25K – $1M |
| Term | 4–18 months (revenue-adjusted) |
| Factor rate | 1.15 – 1.45 |
| Holdback | 7% – 20% of daily deposits |
| Minimum monthly revenue | $20,000 |
| Minimum time in business | 6+ months |
When MCA is the right tool
- Bridging a documented revenue event (new contract, seasonal ramp, payer reimbursement delay).
- Funding in days, not weeks, when the opportunity cost of waiting exceeds the cost of capital.
- Operators with strong deposit history but tax returns that don’t reflect the current run-rate.
When it isn’t
- Covering structural losses. MCA accelerates the failure; it doesn’t fix the business.
- Equipment purchases — lease the equipment instead, match the term to the asset life.
- Any situation where an LOC is available within 10 business days.
State availability
We are actively placing MCA in most U.S. states. We do not currently place MCA in California, Utah, Virginia, or Connecticut due to state-specific commercial financing regulation. If you are in one of these states, please see our Lines of Credit and Equipment Leasing services.
Frequently Asked Questions
What is a merchant cash advance (MCA)?
A merchant cash advance provides a lump sum of capital in exchange for a percentage of future revenue. Unlike a traditional loan, repayment adjusts based on your practice’s incoming payments, making it more flexible during slower periods. MCAs are commonly used for short-term funding needs like equipment purchases, office renovations, or bridging cash flow gaps.
How is working capital different from a business loan?
Working capital funding is designed to cover day-to-day operational expenses rather than specific asset purchases. It provides liquidity to manage payroll, supplies, rent, and other recurring costs. Business loans typically fund specific purposes with fixed repayment schedules, while working capital solutions offer more flexibility in how the funds are used.
Can medical practices qualify for working capital financing?
Yes. Medical practices often qualify for favorable working capital terms because they have predictable revenue streams from insurance reimbursements. Lenders view healthcare practices as relatively low-risk borrowers. Practice Management Consultancy works with funding partners who specialize in healthcare to help practices access capital quickly and at competitive rates.
How quickly can I receive working capital funding?
Many working capital products can be funded within 24 to 72 hours of approval, making them ideal for urgent needs. The application process is typically straightforward, requiring basic financial documentation and several months of bank statements. Practice Management Consultancy streamlines this process by pre-qualifying practices and matching them with the right funding source.