Merchant Cash Advance Deal Tracking Metrics

Copyright 2013. Five Components, Inc. All Rights Reserved www.mcasuite.com

MCA Suite Deal Tracking Metrics

August 2013

Use Case: Single MCA Deal

Contractual Stage §  Funder funds Merchant for $1,000 at a 1.22 factor (payback $1,220). §  Funder charges $50 administrative fee for processing the Cash Advance. §  Funder’s actual out of pocket cash for the Deal is: $950, which is the what

Funder stands to lose if Merchant defaults immediately. §  Funder is expected to pay $50 commission for funding the Merchant.

Post-Funding Stage §  Merchant repaid: $555. §  Amount outstanding for the deal is: $665. §  Funder paid $25 in commission. §  Cash exposure is: $395, Funder stands to lose this amount if Merchant

defaults. §  Expected Deal Revenue (to make from the deal) is $220 §  Net Deal Revenue (minus expenses) is $245 (because only $25 of the $50

commission has been paid to a third party)

Copyright 2013. Five Components, Inc. All Rights Reserved 2

New Deal Tracking Labels & Definitions For Single Deals


Total cash advance given to the Merchant

Commission owed to a third party

Expected revenue from the deal

Actual revenue from the deal

Commission paid to a third party Total unpaid principal

from Merchant on the current deal

Single Deal Tracking Equations


Net Advance Amount (it will be different in a refinance deal)

Sum of All Scheduled Payable Commission

Expected Payback [minus] Net Advance Amount [minus] Scheduled Payable Commission

Actual Expected Payback [minus] Net Advance Amount [minus] Commission Paid

Sum of All Settled Commission

Net Advance Amount [minus] Amount Repaid

Use Case: MCA Deal Refinance

Original Deal §  $1,000 for $1,220 with an administration fee of $50 ($950 cash). §  Merchant repaid $555 of the $1,220 (Amount Outstanding: $665). §  Cash exposure is: $395 ($950 minus $555)

Refinance Scenario §  Merchant asking for another $1,000 at 1.22 factor. §  Funder funds Merchant for another $1,000 with a $45 administrative fee

($955 new money infusion). §  Funder’s cash exposure after funding the refinance is $1,350 ($955 of the

new money plus $395 from the Original Deal). §  Consolidated Deal Revenue (revenues from both deals) is: $656.30

($411.30 for the current deal plus $245 from the previous deal)


Newly Refinanced Deal That Include Balance From Previous Deal


Total cash advance given to the Merchant at the time of funding (new cash infusion plus exposure from previous deal)

Principal owed from previous deal (before refinance)

The new cash infusion provided to the Merchant

Total cash exposure including refinanced deals

Total revenue for all deals including refinanced deals

Total unpaid principal from Merchant on the current deal

Newly Refinanced Deal:

New cash infusion minus administrative fees

Refinanced Deal Tracking Equations


Amount Requested [minus] Administrative Fees

Pulled from previous deal at the time of refinance

The new cash infusion provided to the Merchant

Total cash exposure including refinanced deals

Total revenue for all deals including refinanced deals

Actual Expected Payback [minus] Net Advance Amount [minus ]Commission Paid [minus] Amount Outstanding from Previous Deal

Net Advance Amount [minus] Amount Repaid

MCA Suite Contact Information

To learn more about MCA Suite and how we can improve your merchant cash advance operations, please contact us for a demo:

www.mcasuite.com

[email protected]

twitter.com/MCASuite


Date post:	26-Jan-2015
Category:	Economy & Finance
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Merchant Cash Advance Deal Tracking Metrics

Economy & Finance