How do you calculate the real cost of a merchant cash advance?

Multiply the advance amount by the factor rate to get the total payback. The difference between the payback and the advance is your total cost (the fee). To find the true APR, you also need the repayment term, because the same dollar cost over a shorter term is a much higher annual rate.

What is a factor rate on an MCA?

A factor rate is a multiplier, usually between 1.1 and 1.5, applied to the advance. A $50,000 advance at a 1.40 factor rate means you repay $70,000 total — a $20,000 cost. Factor rates are not interest rates and usually translate to a much higher APR.

Why is an MCA's APR so high?

Because MCAs are repaid quickly (often 4–12 months) with fixed daily or weekly payments, the cost is compressed into a short window. A 1.40 factor over 9 months can equal an APR well over 70–90%, far above term loans or lines of credit.

How can I get out of an expensive merchant cash advance?

Common options include refinancing or consolidating into a lower-cost term loan or line of credit, depending on your revenue and credit. Axiant Partners matches businesses with lenders that may offer lower-cost financing than a typical MCA.

Merchant Cash Advance Calculator: See the Real APR

A factor rate hides the true cost of a merchant cash advance. Enter your advance, factor rate, and term to see the real APR, total fees, your daily or weekly payment — and how much a lower-cost option could save you.

Advance Amount ($)

Factor Rate Usually 1.1–1.5. Your total payback = advance × factor.

Estimated Term (months) How long until it's paid off.

Payment Frequency

Compare to a loan at this APR (%) Typical term loan / line of credit for comparison.

—

Estimated true APR

—

Total cost (fees)

Total payback—

Cost per $1 borrowed—

Estimated payment—

Number of payments—

Paying too much for an MCA?

We match businesses with lenders that may offer lower-cost term loans and lines of credit — and help you refinance or consolidate an expensive advance.

Get Matched With Lower-Cost Financing →