How to Choose Between These Products
The table above compares eight funding products side by side, but the “best” one depends entirely on which variable matters most to your situation right now: speed, cost, credit requirements, or funding amount. Use the filters above to narrow the list to what you’d actually qualify for, then weigh the remaining options against these three questions:
- How fast do you actually need the money? If it’s an emergency (payroll tomorrow, a time-limited inventory deal), speed usually has to win even if it costs more.
- Can your cash flow absorb daily or weekly repayment? MCAs and revenue advances repay automatically from your bank account or card sales — that works for businesses with steady daily revenue, but can strain seasonal or lumpy-revenue businesses.
- Is this a recurring need or a one-time gap? A revolving line of credit costs more to set up but pays for itself if you’ll need capital access repeatedly; a term loan or advance is simpler for a single, defined use of funds.
How “Cost” Is Measured Differently Across These Products
One of the most common points of confusion when comparing offers is that these products don’t quote cost the same way, which makes a side-by-side “which is cheaper” comparison misleading unless you convert everything to the same basis.
MCA and revenue-based advance products quote a factor rate (e.g., 1.15–1.49) — a fixed multiplier applied once to your advance, not an annualized rate. Bank products quote APR, an annualized percentage. A 1.35 factor rate repaid over 6 months is roughly equivalent to a 70% APR — always convert factor rates to an annualized basis before comparing against a bank loan or credit line. Our factor rate calculator does this instantly.
Invoice factoring is quoted as a flat fee percentage per invoice, which also needs to be annualized based on how long the invoice takes to collect — the same logic used in our invoice factoring calculator above.
Common Comparison Mistakes to Avoid
Assuming the cheapest option is always the best one
An SBA loan at 10-15% APR looks dramatically cheaper than an MCA at a 70% APR-equivalent — but if funding takes 60 days and you need it in 3, the “cheap” option isn’t actually available to you right now. Speed and cost are both real constraints.
Ignoring repayment structure when comparing daily-debit products
Two products with identical cost can feel completely different in practice if one debits daily and the other debits weekly or monthly — daily ACH repayment requires much tighter day-to-day cash flow management.
Not checking whether you actually qualify before comparing
Use the credit score filter above first. Comparing an SBA loan (640+ credit typically required) against your actual 580 credit score wastes time — filter to what you’d realistically qualify for, then compare within that set.
Frequently Asked Questions
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