How Much MCA Debt Is Outstanding in the US Right Now

The number is not reported in any official database. The industry is not required to disclose its origination volume. The estimates are pieced together from court filings, industry surveys, and the complaints of millions of small business owners who are making daily payments on obligations they did not fully understand when they signed.

The merchant cash advance industry does not report origination data to any federal or state regulatory agency. There is no MCA equivalent of the FDIC’s quarterly banking reports or the Federal Reserve’s loan data. The industry’s size is estimated, not measured. The estimates come from industry trade groups, financial research firms, legal databases, and the limited reporting of publicly traded funders.

The Estimates

Industry estimates suggest that the MCA market originates between $15 billion and $20 billion annually in the United States. Some estimates are higher, reflecting the difficulty of capturing the full market including smaller, regional funders that do not participate in industry surveys. The outstanding balance at any given time — the total amount of MCA obligations currently being repaid through daily withdrawals — is estimated at $10 billion to $15 billion or more.

These numbers have grown significantly over the past decade. The market was estimated at $3 billion to $5 billion in annual originations in 2010. The growth to $15 billion to $20 billion represents a tripling or quadrupling of the market in roughly ten years. The growth trajectory has been consistent, interrupted only briefly by the pandemic in 2020 before resuming.

Who Carries the Debt

MCA debt is concentrated in industries with high cash flow volatility and limited access to traditional banking: restaurants, retail, construction, trucking, healthcare, salons, e-commerce, and service businesses. The typical MCA borrower is a small business with $200,000 to $2 million in annual revenue, fewer than 20 employees, and limited collateral. The borrower has typically been declined by at least one traditional lender before turning to the MCA market.

Stacking — carrying multiple simultaneous MCAs — is widespread. Industry data suggests that a significant percentage of MCA borrowers carry two or more advances simultaneously. Each additional advance increases the total outstanding balance and the daily withdrawal obligation, compounding the financial pressure on the business.

Geographic concentration follows small business density. New York, California, Florida, Texas, New Jersey, and Illinois account for a disproportionate share of MCA originations, reflecting both the concentration of small businesses and the concentration of MCA broker activity in those states.

Why the Number Matters

The scale of the MCA market matters because it quantifies a systemic financial risk to the small business economy. Billions of dollars in high-cost, short-term obligations are being serviced through daily withdrawals from businesses operating on thin margins. The aggregate daily drain on small business cash flow is substantial. When a meaningful percentage of these obligations default — and default rates in the MCA industry are estimated at 20% to 30% or higher — the consequences ripple through the businesses, their employees, their vendors, and their communities.

The number also matters for the regulatory and legal response. A $20 billion industry operating largely outside the regulatory framework deserves regulatory attention proportional to its size. The state disclosure laws, AG enforcement actions, and court decisions that are beginning to address MCA practices are responses to a problem whose scale is now impossible to ignore.

DEFENSE TEAM SPOTLIGHT

Todd Spodek

Lead Attorney & Founder

Featured on Netflix's "Inventing Anna," Todd Spodek brings decades of high-stakes criminal defense experience. His aggressive approach has secured dismissals and acquittals in cases others deemed unwinnable.

NY Bar Admitted Multi-State Licensed Federal Courts

Meet the Full Team

For the individual business owner, the number provides context. You are not alone. Millions of businesses are carrying MCA debt. Tens of thousands have defaulted. Thousands have settled. Hundreds have successfully challenged their agreements in court. The legal tools, the settlement strategies, and the recovery pathways described throughout these articles are not theoretical. They are being used by business owners across the country, in every industry, in every state.

The data gap is itself a problem. The absence of reliable, publicly reported data on the MCA market makes it difficult for regulators to assess the industry’s impact, for researchers to study borrower outcomes, and for policymakers to design appropriate interventions. The CFPB’s Section 1071 rule will begin to close this gap by requiring MCA companies to report origination data. But until the rule is fully implemented, the market’s true size and its impact on small businesses remain matters of estimation rather than measurement.

What is not estimated is the human toll. Behind every MCA default statistic is a business owner who took an advance to keep the business alive and found that the advance was killing it. Behind every stacking statistic is a business owner who took a second and third advance because the first one created a gap that had to be filled. Behind every effective APR calculation is a cost that the business owner did not understand when they signed. The numbers are abstract. The impact is personal. And the scale of the impact — millions of businesses, tens of billions of dollars — makes MCA debt one of the most significant and underreported financial issues affecting the American small business economy.