Franchise owners with $4,000-$6,000+/month in bank deposits and a 500+ FICO can access $10,000 to $500,000 via MCA, depending on deposit volume. The franchise brand affiliation itself doesn't affect approval: only the franchisee's business bank statements matter. Before applying, review your franchise agreement for debt restrictions; some FDDs require franchisor approval for new financing.
Unique Cash Flow Challenges for Franchisees
Franchisees face cash flow pressures that independent business owners don't:
- Royalty payments: Fixed percentage of revenue (typically 4-8%) regardless of profitability
- Marketing co-op contributions: Mandatory brand fund contributions (typically 1-4% of revenue) that must be paid regardless of local advertising ROI
- Equipment mandates: Franchisors periodically require equipment upgrades (new POS systems, equipment refreshes, remodel requirements), and these aren't optional
- Brand-mandated inventory: New product launches, seasonal menu changes, required inventory stocking levels
- Franchise renewal fees: Multi-year agreement renewal fees that come due on schedule
These obligations create predictable cash demands that don't flex with the business's own cash flow. When a slow month coincides with a royalty payment or equipment mandate, franchisees face a crunch that working capital solves efficiently.
Best Uses for Franchise Working Capital
Check Your Franchise Agreement First
Important: Review Your FDD and Franchise Agreement
Some franchise agreements restrict franchisees from taking on additional debt or require franchisor approval. MCA is a purchase of receivables (not technically a loan), but many franchise attorneys advise treating it like debt for FDD compliance purposes. Review Item 6 and Item 9 of your FDD, and your franchise agreement's financial covenants section, before applying. If in doubt, ask your franchise attorney for a 30-minute review.
Funding Amounts by Franchise Type
| Franchise Category | Typical Monthly Deposits | Typical MCA Range |
|---|---|---|
| Single QSR unit (fast food) | $80,000-$200,000 | $70,000-$280,000 |
| Single fitness/gym franchise | $30,000-$80,000 | $25,000-$110,000 |
| Service brand (cleaning, pest control) | $20,000-$60,000 | $15,000-$85,000 |
| Auto service franchise | $40,000-$120,000 | $35,000-$165,000 |
| Retail franchise | $25,000-$80,000 | $20,000-$110,000 |
| Multi-unit operator (3+ units) | $200,000+ | $150,000-$500,000 |
Qualification Requirements
Fund Your Franchise Operation
No collateral. No hard pull during initial review. 500 FICO minimum. Review begins as soon as your file is complete.
Check My RateFAQ
- Does the franchisor find out about my MCA?
- Not directly from us. We don't notify franchisors, and MCA is not typically reported to the major business credit bureaus in the same way that bank loans are. However, if your franchise agreement requires franchisor disclosure of new financing, that obligation is yours to fulfill, so review your agreement.
- I'm in my first year of franchising. Am I too new?
- The 6-month minimum still applies. If you opened 4 months ago, wait another 2 months and apply with 6 months of statements. If your first year is going well and deposits are strong, you may actually be a very strong candidate, since franchises often have faster revenue ramp-ups than independent businesses due to the brand and training support.
- Can I get MCA alongside an SBA franchise loan?
- Most SBA loan agreements prohibit taking on additional significant debt without SBA approval. MCA's status as a "purchase of receivables" rather than a loan means some SBA borrowers can use MCA, but this is SBA-agreement specific. Consult your SBA lender before applying. The situations to avoid MCA guide covers this as well.