Industry Funding Guide — Electrical Contractors

Electrical Contractor Funding:
Fast Capital for Electricians

Quick Answer

Licensed electrical contractors can access $15,000–$500,000 in MCA funding based on bank deposits, not accounts receivable. Minimum: 500 FICO, decision in 2–4 hours, one application reaches 40+ funders. Repayment is a daily percentage of deposits, closing the gap between finishing a job and getting paid.

Commercial invoices take 30–90 days to clear. Payroll is every week. Panel upgrade inventory has to be purchased before the job starts. T.A.G. works with licensed electrical contractors — residential, commercial, and industrial — to close the gap between when the work happens and when the money arrives.

$15K–$500K
Typical advance range
500 FICO
Minimum credit score
2–4 hrs
Decision timeline
40+ funders
One application

What Electrical Contractors Use Funding For

Every one of these situations is fundable the same week you apply — no tax returns required.

  • Accounts Receivable Bridge A $180,000 commercial tenant improvement is 60% complete. The GC owes you $90,000 due in 45 days. Payroll is in 5 days. An MCA lets you pay your crew now and repay from the GC deposit when it lands.
  • Pre-Job Inventory Large panel upgrade contracts require wire, conduit, breakers, and disconnects purchased before the first crew day. Funders advance against your deposit history — not the contract value — so you get cash before materials are staged.
  • Service Vehicle Purchase or Repair A van breakdown stops service calls immediately. Fleet vehicles for electrical contractors are major productive assets — an MCA can fund a replacement vehicle purchase or a major repair within 24–48 hours of approval.
  • Hiring Journeymen and Apprentices Winning a multi-unit residential or commercial contract means scaling your crew before revenue arrives. MCA funding bridges the first 30–60 days of new labor costs while the project ramps up.
  • Test Equipment and Tools Infrared cameras, thermal imagers, conduit benders, cable pullers, and generator sets are expensive but essential. One MCA advance covers a full equipment upgrade without equipment-specific financing or liens.
  • Seasonal Revenue Gaps Residential electrical work slows in winter months in cold-weather markets. MCA funding helps established electrical companies maintain payroll, insurance, and vehicle payments during predictable slow seasons without laying off skilled workers.

Qualification Requirements

MCA for electrical contractors is based on deposit volume — not FICO score alone, not credit history alone.

Time in Business
6+ months
Minimum operating history. Most applicants have 1–3 years in business.
Monthly Deposits
$10,000+
Average monthly bank deposits across all business accounts. Higher deposits = larger offers.
Minimum FICO
500
Personal credit score. Tax liens, prior bankruptcy, and bank turndowns are individually reviewed.
Bank Statements
6 consecutive months
All pages of the 6 most recent months. Minimum $4,000+ ending balance each month.
NSF Tolerance
≤ 6/mo
Non-sufficient fund events are reviewed individually. Under 6 NSFs per month is generally acceptable.
Industry
All Electrical
Residential, commercial, industrial, specialty (low-voltage, solar, EV charging) all eligible.

MCA vs. Other Funding Options for Electrical Contractors

Electrical contractors have several financing options. Here is how they compare on the criteria that matter most in the field.

Factor MCA (T.A.G.) Fastest SBA Loan Bank Line of Credit
Time to Funds 24–48 hours 60–120 days 30–90 days
Credit Requirement 500 FICO minimum 650–680 FICO typical 640–700 FICO typical
Revenue Minimum $10,000/month deposits $250,000–$500,000/year $250,000–$500,000/year
Collateral Required None (UCC-1 on receivables) Yes — business assets, real estate Often yes — receivables or assets
Tax Returns Required No Yes — 2–3 years Yes — 1–2 years
Approval Rate ~80%+ for qualified applicants ~50% of complete applications ~45% of applicants
Best Use Case Payroll bridge, AR gap, fast equipment Long-term equipment, real estate Ongoing working capital needs
Cost Structure Fixed factor rate (1.15–1.49) Interest rate (6–11%) + fees Interest rate (Prime + 2–4%)

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How Electrical Contractor MCA Repayment Works

MCA is not a loan. Understanding how it actually works helps you evaluate whether it fits your cash flow model.

The Factor Rate

Instead of an interest rate, MCA uses a factor rate — a multiplier applied to the advance amount to determine total repayment. For electrical contractors, factor rates typically range from 1.15 to 1.49. At a 1.25 factor rate, borrowing $60,000 means a total repayment of $75,000.

The Holdback

Repayment happens via daily or weekly ACH debits — the "holdback" — typically set at 10–20% of your average daily deposits. If your business deposits $3,000/day on average, your daily holdback would be $300–$600. On days with lower deposits, the same fixed amount is debited — which means repayment pace varies with your actual revenue flow.

Real Repayment Example

An electrical contractor advances $50,000 at a 1.30 factor rate. Total repayment: $65,000. With a 15% holdback on $2,500/day average deposits, the daily debit is $375. At that pace, the advance repays in approximately 173 business days (~8.5 months). If the company has a strong month and deposits increase, repayment accelerates proportionally.

No Fixed Term

Unlike a term loan, MCA has no fixed maturity date. If business slows and deposits drop, the daily debit amount is still fixed — but you can discuss modifying the holdback percentage with T.A.G. if your cash flow requires adjustment.

Revenue Patterns That Affect Electrical Contractor Funding Amounts

MCA underwriters look at trailing deposit averages — not contract values or projected revenue. Here is how to position your application for the largest possible offer.

Residential Electricians

Residential electrical work — service upgrades, panel replacements, new construction wiring — is typically paid at job completion or within 5–10 days of invoice. Residential contractors often have cleaner, more consistent deposit patterns than commercial contractors, which translates to lower factor rates and easier approvals. A residential electrician averaging $25,000/month in deposits would typically qualify for $18,000–$37,000.

Commercial Electricians

Commercial electrical contractors working on tenant improvements, retail buildouts, or industrial facilities operate on net-30 to net-90 invoice cycles. Deposits may be lumpy — large amounts arriving infrequently. Underwriters recognize this pattern and evaluate the 3-month average rather than any single month. Apply when 3 months of strong deposit history are on file — ideally after completing a major project and receiving payment.

Government and Public Works Contractors

Electrical contractors working on public school, hospital, municipal, or federal projects may have longer payment cycles (60–120 days from invoice). These contracts are stable and low-risk, but the AR gap is significant. MCA is well-suited to bridge public works AR gaps — and having a signed government contract on file can support a larger advance. T.A.G. review underwriting individually for contractors with substantial public work.

Mixed Residential and Commercial

Many electrical companies serve both markets. Residential work generates consistent daily deposits; commercial jobs create large lump deposits on completion. This mixed profile is common and well-understood — mixed-book contractors often qualify for advances toward the higher end of the range because underwriters can see multiple revenue streams in the bank statements.

Frequently Asked Questions — Electrical Contractor Funding

Specific answers for licensed electricians, EC companies, and specialty contractors.

  • Electrical contractors typically qualify for $15,000 to $500,000. The specific offer is based on 75–150% of your trailing 3-month average monthly deposits. A company averaging $40,000/month in bank deposits would typically qualify for $30,000–$60,000. Companies depositing $100,000+/month commonly see offers in the $100,000–$300,000 range. Same-day applications received before noon can fund the same business day.
  • Yes. The minimum FICO is 500. MCA underwriters primarily evaluate your business bank statement deposit volume and consistency — not your personal credit score. Tax liens, bank turndowns, and prior bankruptcies are individually reviewed and do not automatically disqualify you.
  • Three items: (1) a completed one-page business application, (2) 6 consecutive months of business bank statements — all pages including blank pages, (3) a voided business check. No tax returns, no business plan, no financial projections required. Government contract documentation can optionally be provided to support a larger offer.
  • Most electrical contractors receive an approval decision within 2–4 hours during business hours. Funds are deposited within 24–48 hours of contract signing. Complete applications submitted before noon are eligible for same-day funding. The full timeline from application to funds in account is typically 1–3 business days.
  • Yes. Bridging accounts receivable gaps between project completion and GC payment is one of the most common uses for electrical contractors. Commercial invoices on net-30 to net-90 terms create predictable cash flow gaps. An MCA can be drawn immediately to cover payroll and overhead while waiting for the GC invoice to clear, with the holdback repaying from deposits as payments arrive.
  • Electrical contractors typically see factor rates between 1.15 and 1.49. A 1.25 factor rate on a $50,000 advance means repaying $62,500 total. Factor rates depend on business age, deposit consistency, existing advances, and credit profile. Companies with 2+ years in business and consistent deposits typically qualify for rates of 1.15–1.25.
  • Yes, with at least 6 months of operating history and $10,000+ in average monthly deposits. Newer electrical businesses may see lower maximum advance amounts but qualify for the same programs. A newly licensed EC who immediately began generating solid deposit volume — from residential service or small commercial — can qualify within their first operating year.
  • MCA does not require hard collateral like equipment, real estate, or receivables pledged directly. Most MCA agreements file a UCC-1 financing statement on business assets, which establishes the funder's priority position on future receivables. This is a standard legal notice — not a lien against physical property. T.A.G. discloses all UCC filings before any contract is signed.
  • Yes, in many cases. Second-position MCA is available for electrical contractors who already have an outstanding advance but have strong ongoing deposit volume. T.A.G. evaluates existing positions and remaining balance against current deposit trends. Not all funders offer second-position advances — but within T.A.G.'s network of 40+ funders, second-position options are commonly available.

Related Contractor Funding Resources

Other funding pages for electrical contractors and related trades.

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