What Is Revenue-Based Financing? How It Works vs a Term Loan or Line of Credit

Diagram of revenue-based financing: a lump sum upfront, then business revenue, then a remittance percentage until the total payback is reached. Labels below read Funded amount, Total payback, Remittance %.

Quick answer: Revenue-based financing (RBF) is a lump sum repaid as a share of future sales or deposits until a set total is paid, not as a fixed monthly loan payment. For Main Street businesses, RBF and a merchant cash advance (MCA) are the same product family. A factor rate sets the total payback; a … Read more