Factoring gives you advanced access to funds from existing invoices, while MCA loans give you money based on an estimate of future sales. If your sales fall short of expectations, you’ll still need to repay that money with an MCA loan.
MCA loans also require access to your bank accounts so they can automatically take out funds on a daily or weekly basis. Even though these loans may be easily available, they often come at a very high cost and can damage your cash flow through immediate paybacks and frequent withdrawals. With factoring, the advances are repaid when your customers pay the invoice.