T.A.G. Business Funding is an independent MCA ISO (Independent Sales Organization). As an ISO, we receive and review merchant cash advance offers from multiple funders for each merchant application. This study is based on offers reviewed and processed through our ISO operation between January 2025 and June 2026.
Because we work with multiple funders simultaneously for each application, our data reflects actual offered factor rates across the funder landscape — not list rates or advertised ranges. This includes offers from Tier 1 funders (largest, most competitive), Tier 2 funders (mid-market), and Tier 3 funders (higher-risk specialists).
All data is anonymized and aggregated. No individual merchant data is disclosed. Industry categories follow the standard MCA underwriting classification system used by major funders.
Industries covered: Restaurant/Food Service, HVAC/Contractor, Retail, Trucking/Transportation, Auto Repair, Healthcare/Medical, Beauty/Salon, Food Truck/Mobile Food, Roofing, Bakery/Food Production
Credit tiers: 500–549, 550–599, 600–649, 650–699, 700+
Advance sizes: Under $25K, $25K–$75K, $75K–$150K, $150K+
Geographic coverage: Nationwide (United States)
Factor rates vary by industry primarily because funders price based on revenue predictability and historical default rates. Industries with consistent, verifiable daily card or deposit volume receive lower rates. Seasonal or volatile industries pay more.
| Industry | Factor Rate Range | Average Factor Rate | Avg Advance Amount | Approval Rate | Risk Tier |
|---|---|---|---|---|---|
| Healthcare / Medical | 1.10 – 1.35 | 1.22 | $67,300 | 71% | Low |
| Auto Repair | 1.15 – 1.40 | 1.26 | $22,800 | 65% | Low–Mid |
| Restaurant / Food Service | 1.15 – 1.40 | 1.27 | $32,400 | 64% | Mid |
| Bakery / Food Production | 1.18 – 1.40 | 1.28 | $19,600 | 62% | Mid |
| HVAC / Contractor | 1.18 – 1.42 | 1.29 | $48,700 | 67% | Mid |
| Roofing | 1.20 – 1.42 | 1.30 | $44,100 | 65% | Mid |
| Retail | 1.20 – 1.45 | 1.31 | $28,100 | 59% | Mid–High |
| Trucking / Transportation | 1.22 – 1.48 | 1.33 | $41,200 | 61% | Mid–High |
| Beauty / Salon | 1.22 – 1.45 | 1.32 | $18,400 | 57% | Mid–High |
| Food Truck / Mobile Food | 1.25 – 1.50 | 1.36 | $14,800 | 54% | High |
Source: T.A.G. Business Funding ISO deal flow, January 2025 – June 2026. All figures represent averages across funder offers received per application. Individual offers may vary.
Credit score is a secondary underwriting factor for most MCA funders — revenue consistency and bank statement health are weighted more heavily. However, credit score meaningfully affects factor rate, particularly at the extremes. Borrowers below 550 FICO typically receive offers 0.20–0.25 higher than those above 700.
| FICO Score Range | Factor Rate Range | Average Factor Rate | Effective APR (6-mo term) | Notes |
|---|---|---|---|---|
| 700 and above | 1.10 – 1.22 | 1.15 | ~33% | Best terms; Tier 1 funder access |
| 650 – 699 | 1.18 – 1.30 | 1.24 | ~52% | Competitive offers; most Tier 1–2 funders |
| 600 – 649 | 1.25 – 1.38 | 1.31 | ~68% | Mid-tier funders dominant; solid revenue required |
| 550 – 599 | 1.32 – 1.45 | 1.38 | ~84% | Tier 2–3 funders; revenue quality critical |
| 500 – 549 | 1.38 – 1.50 | 1.43 | ~98% | Minimum approval threshold; Tier 3 funders only |
Effective APR estimates assume a 6-month (approximately 130 business day) repayment term. Actual APR varies based on term length. Shorter terms result in higher effective APR.
In our file pool, credit score was ranked 3rd in underwriting weight — behind (1) average monthly deposit volume and (2) bank statement consistency. A business with 620 FICO and strong, consistent revenue often receives better offers than a 680 FICO business with irregular deposit patterns. The bank statements matter more than the score.
Advance size and factor rate have an inverse relationship: larger advances attract more funder competition and typically reflect more established businesses, resulting in lower factor rates. Very small advances under $25,000 carry the highest rates because they represent less revenue to funders relative to underwriting cost.
| Advance Size | Factor Rate Range | Average Factor Rate | Typical Holdback % | Typical Term |
|---|---|---|---|---|
| Under $25,000 | 1.28 – 1.50 | 1.38 | 15–20% | 3–5 months |
| $25,000 – $75,000 | 1.18 – 1.38 | 1.27 | 12–16% | 4–8 months |
| $75,000 – $150,000 | 1.15 – 1.35 | 1.24 | 10–14% | 6–12 months |
| $150,000 and above | 1.10 – 1.30 | 1.20 | 8–12% | 9–18 months |
Holdback percentages reflect the daily or weekly percentage of bank deposits withheld for MCA repayment. Term estimates are illustrative — actual term depends on holdback % and revenue volume.
Based on our ISO deal flow, funder underwriting decisions weight these variables in roughly the following order of importance:
Weight estimates based on ISO deal flow observation and funder feedback. Not a statistical regression — represents practitioner judgment on relative weighting.
Existing advance positions (stacking) had the largest single-variable impact on factor rate in our data. A business with an existing active MCA typically received offers 0.08–0.15 higher than an identical business with no existing position. In some cases, stacking disqualified the application entirely at Tier 1 funders.
Approval rate is the percentage of applications submitted by T.A.G. that resulted in at least one fundable offer. A declined application means no funder offered terms — not necessarily that the merchant is ineligible permanently.
Approval rate = applications with at least one fundable offer / total applications submitted in that industry category. Does not reflect whether the merchant accepted the offer.
Based on our ISO deal flow, here is what a competitive MCA offer looks like for a qualified borrower in 2026 — and what a subprime offer looks like that should be scrutinized before accepting:
Factor rate: 1.15 – 1.28
Holdback: 10–14% of daily deposits
Term: 6–10 months
No prepayment penalty
Single funder position
Same-day approval, 48–72hr funding
No undisclosed ISO fee above 5%
Factor rate: 1.40+
Holdback: 20%+ of deposits
Confession of judgment clause
Daily payment above 25% of avg daily revenue
Renewal pressure before first position is 50% paid
Undisclosed ISO fee stacked in payoff
Second or third position stacking required
Factor rates in the MCA market are influenced by macro credit conditions, funder capital availability, and post-pandemic small business default patterns. Based on our ISO experience across this period:
| Period | Avg Factor Rate (All Industries) | Market Context |
|---|---|---|
| 2022 | 1.33 | Post-COVID risk premium; elevated defaults in restaurant/retail drove rates up |
| 2023 | 1.31 | Normalization; funder competition increased; Tier 1 began re-entering lower FICO bands |
| 2024 | 1.29 | Competitive market; multiple funders competing for quality files drove rates toward lower range |
| 2025 | 1.28 | Continued normalization; inflation impact on small business cash flow increased volume |
| H1 2026 | 1.29 | Slight uptick in early 2026; economic uncertainty caused some Tier 1 funders to tighten |
Overall factor rates have compressed by approximately 0.04 points since 2022, reflecting increased funder competition and improved underwriting data availability. The market remains favorable for qualified borrowers — a 2026 quality applicant receives meaningfully better terms than a comparable applicant would have in 2022.
Journalists and researchers may use this data freely with attribution to T.A.G. Business Funding and a link to this page. For questions about methodology or data requests, contact us directly.
