Working Capital for Restaurants
Food cost inflation, a broken walk-in, or a slow month can strain a restaurant's cash flow fast: and margins are already thin. MCA advances against your POS/deposit history so you're not waiting weeks on a bank while perishables spoil and payroll comes due.
Restaurants with 6+ months of operating history, $4,000 to $6,000+/month in deposits, and a 500+ FICO qualify for MCA. Daily POS deposits (Toast, Square, Clover) create the consistent deposit pattern underwriters evaluate. Most restaurants qualify for $8,000 to $100,000, funded once the provider approves your file.
Restaurant tip: Make sure all POS deposits (Toast, Square, Clover, Aloha) flow into one dedicated business bank account, not split across a personal account or multiple accounts, to maximize your qualifying deposit average.
A restaurant comparing a bank/SBA term loan to a merchant cash advance is weighing speed and thin-margin accessibility against lower headline cost. Here is how they compare when a walk-in fails or food costs spike overnight.
At a Glance
Need capital fast for an equipment failure or cost spike: MCA, with funding timing set by the funding provider after review. Have strong financials and 2+ years to plan a renovation: a term loan is the lower-cost path.
| Feature | Merchant Cash Advance (MCA) | Traditional Term Loan |
|---|---|---|
| Approval basis | Average monthly POS/deposit history, 500+ FICO, 6+ months in business | Credit history, financials, collateral, 2+ years in business |
| Time to funding | Set by the funding provider after review | 2 to 8 weeks depending on lender |
| Repayment | Daily/weekly holdback as a % of POS deposits: scales with sales volume | Fixed monthly payment regardless of a slow week |
| Collateral | None: a UCC-1 is filed against future receivables | Often required (equipment or real estate lien) |
| Best fit | Equipment failures, cost spikes, thin-margin operators needing speed | Established restaurants planning a renovation or expansion months out |
Illustrative examples built from typical underwriting profiles for this industry: not records of specific named customers or guaranteed outcomes. Actual approval amount, timeline, and rate depend on your own bank statements and profile.
Yes. MCA has no minimum credit score cutoff beyond a 500+ FICO floor: revenue and deposit consistency matter more than credit score. A restaurant with a 530 FICO and strong, consistent POS deposits often qualifies for better terms than one with a higher score but inconsistent deposits.
Most restaurants qualify for 75% to 150% of average monthly deposits. A restaurant averaging $20,000/month in POS deposits typically qualifies for $15,000 to $30,000. Amounts scale with deposit volume, time in business, and FICO.
The 6-consecutive-month window captures both peak and slower months, giving underwriters a realistic full-cycle average rather than only your best month. If your restaurant has a genuine seasonal pattern, apply right after your strongest stretch so those deposits are part of the window.
Yes. MCA proceeds have no restriction on use within the business: covering a temporary spike in food costs, a bulk buy-in before a price increase, or a supplier deposit are all common uses.
No. Ghost kitchens, food trucks, and delivery-only concepts qualify the same way as a sit-down restaurant: underwriting looks at business bank deposit history, not physical format.
Three items: (1) most recent 6 consecutive months of business bank statements: all pages; (2) one-page application with business name, EIN or SSN, monthly revenue estimate, and ownership info; (3) government-issued ID. No tax returns, no menu review, no collateral.
One-page application, 6 consecutive months of bank statements, funded once the provider approves your file. No collateral required.
Or call/text: 330-238-3003
T.A.G. Business Funding
500 FICO minimum. Bank declines OK. Revenue matters more than credit score. Decision timing is set by the funding provider after review.
500 FICO minimum · $4K to $6K+/month revenue · Funding timing is set by the funding provider after review
