Commercial finance terms, in plain English

A broader term that usually refers to merchant cash advance, but can occasionally be used for revenue-based finance too. On Merchant Business Loans, business cash advance refers to the MCA product unless otherwise stated.

A common informal term for merchant cash advance or PDQ cash advance. Technically not a loan, the product is a purchase of future card receivables with a fixed repayment amount, but the term is widely used by business owners looking for funding based on their card machine takings.

The percentage of daily card sales automatically collected by the funder until the fixed cost is fully repaid. Typically 10 to 22 percent, default around 15 percent. Replaces older industry terminology like holdback. The percentage stays the same throughout the life of the advance.

The total amount the business repays for a merchant cash advance (MCA), stated upfront at the point of agreement. Expressed as a multiplier of the advance, for example an advance of £50,000 with a fixed cost of 1.25 means the business repays £62,500 in total. Replaces older industry terminology like fixed cost. The fixed cost does not change based on how long the advance takes to repay.

A commercial finance product where a business receives an upfront lump sum in exchange for a fixed, agreed repayment amount, collected as a small percentage of the business's daily card sales. Not a loan. The repayment amount is fixed at the start (the fixed cost), and the daily collection continues until that amount is repaid. Best suited to businesses with consistent card-based revenue. Also known as PDQ cash advance, card machine loan, business cash advance, card sales advance.

Another name for merchant cash advance. PDQ (Process Data Quickly) is the long-standing UK term for the card terminal machine found at the till point. A PDQ cash advance uses the business's PDQ terminal sales data to underwrite and collect a funding advance. Same product as a merchant cash advance, same mechanics, different terminology more commonly used in hospitality and independent retail.

A commercial finance product where repayments flex with business revenue rather than being fixed. Repayments are taken as a percentage of incoming revenue (not just card sales), so repayment amounts rise and fall with the business's actual takings. Different from MCA in that the total repayment is not fixed at the start, it is governed by the revenue share percentage and the funding period.