In the fast-paced world of Merchant Cash Advances (MCA), speed matters—but speed alone won’t get a deal funded. Nothing stalls a pipeline faster than hearing, “Not fundable.”
The good news? Most MCA declines are preventable. Whether you’re a merchant needing capital or a broker pushing deals through, knowing what funders look for—and what they reject—can significantly improve your close rate.
Below are the five most common reasons MCA deals get declined—and how to fix them.
1. Too Many Stacked Advances
Why It Gets Declined:
Multiple active advances = high risk. When a merchant has 2–3 positions already, daily ACH pulls can choke cash flow. Even with solid revenue, funders see overleveraging as a path to default.
Example:
A merchant making $30,000/month but paying $9,000 across advances is burning 30% of gross income—before rent, payroll, or inventory.
Fix:
- For merchants: Don’t exceed two stacks; consider consolidation.
- For brokers: Submit a payoff list, use stack-tolerant funders responsibly.
- Tactics: Try reverse consolidations, request smaller amounts, and stay within healthy repayment ratios.
2. Irregular or Low Revenue
Why Funders Decline It:
Inconsistent cash flow signals instability. Revenue below $10,000/month, frequent NSFs, or erratic deposits trigger automatic declines.
Red Flags:
- Revenue dips for multiple months.
- Bank statements with overdrafts or unexplained gaps.
- Multiple accounts splitting deposits.
Fix:
- For merchants: Stabilize sales and avoid overdrafts. Use one account.
- For brokers: Wait for stronger months or explain seasonal dips.
- Bonus tip: Add a short context note for any outliers.
3. Disorganized or Problematic Bank Statements
Why It Gets Declined:
Bank statements are the underwriter’s main lens. Poor formatting or red flags like edited PDFs, cash withdrawals, or duplicate deposits hurt your file.
Funders Don’t Want:
- Screenshots instead of PDFs.
- Unlabeled or inconsistent files.
- Multiple NSF hits or reversals.
Fix:
- For merchants: Use clean, original PDF statements from a single account.
- For brokers: Label files clearly, review statements upfront, and explain any unusual activity.
- Pro move: Use tools like Plaid or DecisionLogic for added trust.
Why Funders Say No:
Some industries are inherently risky due to regulations, volatility, or failure rates. Think construction, trucking, cannabis, adult services, and new restaurants.
What Makes It Risky:
- Delayed payments or unpredictable contracts.
- Legal and reputational concerns.
- High failure rates (e.g., food service).
Fix:
- For merchants: Stay compliant with licenses, keep positive online reviews, and share long-term contracts or proof of steady income.
- For brokers: Work only with lenders open to niche industries and highlight business stability, not just revenue.
5. Sloppy Deal Submissions
Why Good Deals Get Rejected:
A clean deal can still get declined if the submission is messy. Missing docs, no explanations, poor formatting—it signals disorganization.
Common Mistakes:
- Missing statements or outdated licenses.
- No summary or explanation for red flags.
- Photos instead of PDFs.
Fix:
- For merchants: Treat submissions like a resume—organized, complete, and clear.
- For brokers: Include a deal summary, preemptively explain issues, and double-check documents.
Quick Fix Table: Common Declines & Solutions
| Decline Reason | Solution |
| Too many advances | Consolidate or request less funding |
| Irregular revenue | Wait for stronger months, explain seasonal trends |
| Messy bank statements | Submit original PDFs, explain anomalies |
| Risky industry | Use niche lenders, provide documentation |
| Sloppy submissions | Organize files, add summary, verify all info |
Advanced MCA Funding Tips for Brokers
- Know your funders: Each has a different risk appetite.
- Leverage tech: Use Plaid to verify bank data and pre-qualify.
- Don’t shotgun files: Send fewer, better-packaged submissions.
- Educate merchants: Help them understand funder requirements.
Final Thoughts: A Decline Isn’t the End
In MCA, a decline isn’t a dead end—it’s data. Underwriting feedback shows where a file needs work. Did revenue dip? Are NSFs piling up? Is the merchant overleveraged?
Revisit the merchant, clean up the file, and resubmit. Many deals fund on the second attempt with just a few adjustments.
Track previously declined merchants—revisit in 30 to 60 days after revenue improves or financials stabilize. Timing matters. A weak March file may become a strong May approval.
Finally, build relationships with funders. They respect brokers who ask questions, improve over time, and submit clean, well-documented files. If you resubmit a revised file addressing previous objections, you’re not just sending a deal—you’re proving professionalism.
Summary: How to Close More MCA Deals
- Organize files like a pro
- Avoid high-risk behavior like stacking or unverified statements
- Target the right funders for each merchant profile
- Use declines as learning opportunities
A “no” today can be a “yes” tomorrow—with better preparation. The brokers who learn, adjust, and improve will close more MCA deals, build lasting merchant trust, and grow their commissions consistently.
Need help with better MCA deal packaging or lender matching?
Reach out—we’ll help turn declines into deals.
