Funding Conversion
Funding conversion measures the rate at which approved MCA submissions actually result in funded deals — the critical late-stage sales funnel metric capturing merchant commitment, closing capability, and competitive performance.
Why This Matters
Funding conversion rate calculation: funded deals / approvals over period. Industry benchmarks: 50-70% funding conversion at strong operations, 30-50% at weaker operations. Common reasons for approval-without-funding: merchant accepting competitor offer, merchant losing capital need urgency, merchant unable to complete final documentation, contract terms exceeding merchant expectations, or merchant becoming uncomfortable with structure during funding call. Strong funding conversion requires fast funding execution (preventing competitor displacement), proper merchant expectation setting throughout sales process, and skilled funding team handling final concerns.
Frequently Asked Questions
Frequently Asked Questions
Why do approved deals fail to fund?
Top reasons: merchant accepts competitor offer (40%), merchant capital need resolved (20%), merchant uncomfortable with terms (20%), and operational issues like documentation problems (20%). Each cause requires different intervention.
How can ISOs improve funding conversion?
Speed (close approval-to-funding gap, eliminating competitor opportunity), expectation setting (ensure merchant understands terms before approval), and funding team training (handling last-minute objections, building closing momentum during funding call).