Escaping the Merchant Cash Advance Trap

How to refinance MCAs with receivables financing.

Updated October 2, 2026 · 2 min read

Quick answer

Merchant cash advances often carry effective annual costs above 60% and daily withdrawals. B2B companies can frequently refinance MCA debt with lower-cost invoice factoring or AR financing.

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Why MCAs are expensive

Factor rates of 1.2–1.5 repaid over months equal very high annualized costs.

Refinancing options

Factoring can pay off MCA balances and release blanket liens.

Avoiding stacking

Never take a second MCA to pay the first — it compounds the problem.

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Written and reviewed by the National Invoice Factoring funding team — specialists in receivables and trade finance since 2009.

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