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Merchant Qualification Calculator

Score merchant qualification across deposits, credit, industry, and position count to estimate approval tier and max offer.

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How Does MCA Qualification Work?

MCA qualification is a multi-factor scoring process that determines whether a funder will approve a merchant and at what terms. Unlike bank loans that gate on credit score and collateral, MCA underwriting weighs bank deposit volume most heavily (40-50% of the decision), followed by time in business (15-20%), industry risk (10-15%), existing positions (10-15%), and owner credit score (10-15%). A merchant with $60K/month in deposits and a 550 credit score can get approved where a bank would decline them. However, the credit score affects the tier placement -- the same deposits with a 700+ score gets a lower factor rate and higher funding multiple. Run all five factors through here to get a predicted approval tier, max offer, and factor rate range before you ever submit to a funder.

How to Use This Calculator

Enter deposit and business history data

Use verified data from bank statements, not what the merchant tells you. Funders will pull statements and verify. Submitting inflated numbers wastes everyone's time and damages your credibility.

Add credit score and industry

Owner personal credit score (not business credit) is used by most MCA funders. Industry affects the risk tier and consequently the factor rate and maximum offer.

Note existing positions

Each additional position reduces the max offer and increases the factor rate. First position deals get the best terms. Third+ position deals face significantly limited options and higher costs.

Key Concepts

A/B/C/D Paper

Industry shorthand for merchant quality tiers. A-paper: strong deposits, high credit, first position. B-paper: moderate with some weaknesses. C-paper: significant risk factors. D-paper: high risk, often only specialty funders will consider.

Qualification Tier

The risk category a funder assigns based on the underwriting score. Tier determines the factor rate, max funding multiple, and term length. Higher tiers mean better terms for the merchant.

Negative Days

Days the bank account had a negative balance. Funders count these from the last 3 months of statements. More than 5 negative days is a red flag. More than 10 often results in decline.

Expert Insights

Pre-Qualifying Saves Everyone Time: Submitting unqualified merchants wastes funder underwriting resources and hurts your approval ratio. Funders track your approval rate -- brokers below 40% get lower priority and worse terms. Use this calculator to pre-qualify before submission. If a merchant scores below C-tier, either address the weaknesses (reduce existing positions, wait for more business history) or use a specialty funder that targets that profile.

The Credit Score Paradox: Many brokers assume low credit means no deal. In MCA, a 520 credit score with $80K/month in deposits is a fundable deal at B or C tier. The deposits prove the business generates revenue regardless of the owner's personal credit history. Conversely, a 750 credit score with $12K/month in deposits is a hard decline because there is not enough revenue to support a meaningful advance. Deposits always trump credit in MCA underwriting.

Frequently Asked Questions

There is no universal minimum. Some funders approve merchants with scores as low as 450-500 if deposits are strong. Most funders require a minimum of 500-550 for first position. For second and third positions, some specialty funders work with 480+. Below 450 limits options to a handful of high-risk funders.

Most funders require a minimum of 4-6 months in business with 3 months of bank statements. Startups under 6 months have very limited options and typically cap at 0.5x monthly revenue with high factor rates (1.40+). Some funders specialize in startup MCA but the terms are expensive.

An active (not discharged) bankruptcy is a near-universal decline. A discharged bankruptcy more than 12 months ago is workable with most funders -- the MCA is structured as a purchase of future receivables, not a loan, so it operates differently under bankruptcy law. However, expect a higher factor rate and lower max offer.

Results are estimates for educational purposes only. Actual amounts may vary based on your specific financial situation, market conditions, and other factors. This calculator does not constitute financial advice.