Deposit Frequency
Deposit frequency is the underwriting metric measuring how often the merchant receives business deposits per month — typically 15+ deposit days per month indicates healthy operations, while concentrated or irregular deposit patterns signal underwriting risk.
Why This Matters
Deposit frequency analysis identifies merchants with diversified, consistent revenue versus concentrated, lumpy revenue. A merchant with 20+ deposit days per month from many small transactions presents lower MCA repayment risk than a merchant with 3 large deposits monthly. Frequency analysis helps detect business types that don't fit standard MCA underwriting (project-based contractors with quarterly invoices, seasonal businesses with concentrated revenue periods). Most funders prefer 12-15+ deposit days as minimum threshold; specialty programs accommodate lumpier patterns at premium pricing.
Frequently Asked Questions
Frequently Asked Questions
What deposit frequency threshold is required for MCA?
Most mainstream programs prefer 12-15+ deposit days per month over the trailing 3 months. Below 8-10 deposit days, decline rates rise sharply unless specialty seasonal-business programs are available. Higher frequency correlates with lower repayment risk and better factor-rate pricing.
Why does deposit frequency matter for MCA underwriting?
Frequent deposits indicate diversified revenue base less vulnerable to single-customer or single-event disruption. Concentrated deposit patterns indicate dependency on specific large customers or seasonal cycles that elevate default risk. Daily-payment MCA structures specifically need consistent revenue flow to support payment schedule.