Partner Zone

Merchant Cash Express (“MCE”) works closely with a small group of Independent Sales Organisations (“ISO”). The typical profile of an ISO is a company engaged in the provision of asset based lending products either as a principal or a broker. The asset based products will include debenture finance, leasing, factoring and invoice discounting. This background fits well in terms of selling the MCE product: the Business Cash Advance.

Business Cash Advance (BCA).

A  Business Cash Advance is a form of factoring. Unlike traditional factoring the BCA involves the sale and purchase of future assets rather than an existing asset. The product is defined as a “True Sale”. MCE purchases from a merchant a Specified Percentage of that merchant’s card receivables. This includes both credit and debit cards.

The price at which MCE purchases those card receivables is the Purchase Price. The sum of the card receivables that MCE purchases is the Purchased Amount. The Purchased Amount is calculated multiplying the Purchase Price by a Factor Rate. The maximum BCA that MCE will advance is typically equivalent to one month’s card turnover.

Example:

• On average merchant turns over £10,000 in card sales per month.

• MCE approves an advance of £10,000 – the Purchase Price.

• A Factor Rate of 1.4 is applied to the Purchase Price. 1.4 x £10,000 = £14,000 – the Purchased Amount.

• Merchant is advanced £10,000 under the terms and conditions of a Sale and Purchase Agreement.
• MCE takes a Specified Percentage of each card batch made by the merchant which in this case is 20%.
• Over time the collection of the Specified Percentage will reach £14,000 - the Final Date, at which point the contract (Sale and Purchase Agreement) will expire. 

Points to Note :

• All contracts contain bespoke pricing; both the Factor Rate and Specified Percentage vary from contract to contract.
• Over 70% of contracts renew.
• Min and Max BCA at present is £3,500 and £100,000.

MCE pays commission to ISOs for each initial advance and on renewals subject to the agreement entered into by MCE and the ISO.

For more information please call on 0845 082 6087 or via the Contact Us form.