Free calculator
Merchant Cash Advance APR Calculator
A factor rate hides the real cost. Enter the offer and see the APR, so you can compare it to a bank loan on the same scale.
Common questions
How do I convert a factor rate to APR?
You need the advance amount, the factor rate, and how fast you pay it back. Multiply the advance by the factor to get the total payback, split it into the daily or weekly payments, then solve for the yearly rate that makes those payments equal the advance. This calculator does that math for you.
What is the APR of a 1.35 factor rate?
It depends on the payback period. A 1.35 factor paid back in daily payments over 6 months is about 126% APR. Over 12 months it is about 63%. Over 3 months it is well over 200%.
Why is the APR so much higher than the factor rate?
Because you start paying it back the next business day. On average you only hold about half the money for half the term, but you pay the full fee. That makes the yearly cost far higher than the factor suggests.
Is this the exact APR on my offer?
It is a close estimate that assumes equal payments and no extra fees. Origination fees, holdbacks that change with sales, and early payoff terms all change the real number. Ask the provider for the APR in writing; some states now require them to disclose it.