[Olderguy]

The reason they just "get a 4th" is because they are part of the 99 out of the 100 businesses who won't qualify for anything else.

That's because most brokers probably just peddle MCA's to make money and push a guy when he's down, aside from your comment to do otherwise.. A merchant should be reviewing his financial situation and thinking about better options when he gets his first MCA. That's what should happen and probably will happen when this industry gets regulated.

[OC Funder]

That's because most brokers probably just peddle MCA's to make money and push a guy when he's down, aside from your comment to do otherwise.. A merchant should be reviewing his financial situation and thinking about better options when he gets his first MCA. That's what should happen and probably will happen when this industry gets regulated.

I reject the notion that merchants only take MCAs when they're desperate, uninformed, or can't qualify for anything else. Speed, structure, frequently no liens... they're are several reasons why an MCA might work better than less expensive forms of financing. If a broker chooses to only offer cash advances that's their prerogative and they shouldn't be shamed for it if they're being honest about it. If they're baiting with fake lines of credit and other nonsense that's a different story, but otherwise there's nothing unethical about selling this product and it's odd that you insist that it is (here of all places).

[Michael I]

I reject the notion that merchants only take MCAs when they're desperate, uninformed, or can't qualify for anything else. Speed, structure, frequently no liens... they're are several reasons why an MCA might work better than less expensive forms of financing. If a broker chooses to only offer cash advances that's their prerogative and they shouldn't be shamed for it if they're being honest about it. If they're baiting with fake lines of credit and other nonsense that's a different story, but otherwise there's nothing unethical about selling this product and it's odd that you insist that it is (here of all places).

fully agree with this

[mistamca]

That's because most brokers probably just peddle MCA's to make money and push a guy when he's down, aside from your comment to do otherwise.. A merchant should be reviewing his financial situation and thinking about better options when he gets his first MCA. That's what should happen and probably will happen when this industry gets regulated.

You do realize that a vast majority of business owners are financially illiterate but NOT dumb. I own a fractional CFO company as well & most owners just do not get it. Regulation is not going to fix that side of it. Aside from fraud, most owners know exactly what they are doing. They believe that their inconsistent revenue is temporary, covid effects are temporary, costs are going to go down, their profit margin is higher, or a heavy chunk of A/R is going to get paid out in 45 days, etc.

What happens when they are wrong? Cash flow is crushed and they need to take another advance or loan. This process repeats until you have an extremely overleveraged individual.
Look at all the high-risk industries and see what they have in common

[Yankeeman07]

"heavy chunk of A/R is going to get paid out in 45 days, etc. What happens when they are wrong" ?

A true MCA, this would not be an issue - a MCA is the purchase of "Future Receivables" - since no one can predict the future - it will
take a bit longer for repayment.

One of the advantages of credit card split funding - they daily repayment is flexible