Friday, June 12, 2026New York · LondonSOFR 5.32Prime 8.50
Capital Desk · OpenVol. VII · No. 26
MCA vs Business Line of Credit.
Both products solve a working-capital problem but they price and behave nothing alike. An MCA is fixed-cost short-term capital. A LOC is revolving capital you draw only when you need it. Picking the wrong one costs 30–60 points of effective APR.
| Dimension | Business Line of Credit | Summit |
|---|---|---|
| Pricing | Prime + 1–6% on drawn balance (10–30% APR) | Factor 1.15–1.49 (~30–80% effective APR) |
| Funding range | $10K – $500K | $5K – $750K |
| Speed to first dollar | 3–7 days | 4–24 hours |
| Credit minimum | 650+ FICO | 500+ FICO |
| Remit | Interest only on drawn balance, monthly | Fixed daily or weekly until receivable is paid |
| Best for | Recurring or unpredictable cash needs over 60+ days | Short defined bridges with payoff inside the remit window |
Verdict
LOC wins on anything you'll carry past 60 days. MCA wins on speed, sub-650 credit, or short bridges where the deal pays off fast. If you don't qualify for the LOC today, take the MCA only as a 30–90 day bridge — then refi into a LOC the moment your file supports it.