How to become an MCA broker (ISO)

A merchant cash advance is the purchase of a share of a business's future receivables for a fixed amount, repaid by daily or weekly remittances. The funder sets a buy rate; the ISO can usually sell the deal at a higher sell rate, and the difference, plus a base commission, is the ISO's pay in points. If you are new to the product itself, the free Learn track on merchant cash advances covers the math and the players.

Most ISOs make their money on volume and renewals: a merchant who pays down an advance is often eligible to renew, and the ISO who placed the first deal is usually paid again. That is why record keeping matters more than it looks on day one.

There is no federal license for MCA brokers. Several states now regulate sales-based financing, and some reach brokers directly (as of October 12, 2026):

• Texas: providers and brokers of commercial sales-based financing must register with the OCCC through NMLS by December 31, 2026 (HB 700).
• Virginia: sales-based financing brokers must register with the State Corporation Commission; funders tell their ISOs the same.
• Connecticut: commercial financing providers and brokers register with the Department of Banking.
• Missouri: commercial financing brokers register and post a $10,000 surety bond.
• Georgia, Florida and Kansas: no registration, but brokers may not take advance fees from merchants.
• New York: providers give the disclosures and must state how and by whom the broker is paid.
• California: AB 2116, signed in 2026, brings commercial financing brokers under California Financing Law licensing from July 1, 2028.

Calling and texting merchants is regulated too; see the rules section of MCA leads. Our disclosure laws guide has the state-by-state disclosure detail.

Each funder you send deals to will want a signed ISO agreement, plus your entity documents and a W-9. Start with five to ten funders that cover different credit tiers: a couple for strong files, a few for mid-tier paper, and one or two that take higher-risk deals or later positions. Read every agreement for:

• Commission terms: the base points, the maximum upsell, and when you are paid (on funding, or after the first remittances).
• [Clawbacks](/glossary/clawback): how long after funding a default can take your commission back, and whether it is all or part.
• Renewal rights: whether you are paid on renewals of merchants you placed, and for how long.
• Non-solicitation and non-circumvention: what you may not do with the funder's merchants, and what the funder may not do with yours.
• Compliance duties: the disclosures, consent and state registrations the funder expects you to handle.

Commissions are quoted in points: one point is 1% of the funded amount. Trade press reported in 2016 that most funders let brokers charge 8 to 12 points above the buy rate, with 3 to 8 points typical on high-quality deals and 15 to 20 on lower-quality ones. Treat those as a historical benchmark; current terms vary by funder and are in your ISO agreements. On a $50,000 advance, 10 points is $5,000 before any split with a rep or a sub-ISO.

The ISO commission calculator works out points, upsell and splits for a deal, and the factor rate calculator shows what the same deal costs the merchant. Keep both in view: a deal priced to the ceiling tends to default sooner and renew less.

New ISOs usually combine bought leads with referrals. Exclusive web leads and live transfers fund best but cost the most; aged leads and UCC lists are cheaper and need volume. Whatever you buy, track every lead's source to the funded deal and the commission received, so you know which source pays. MCA leads covers the types, how to vet a vendor and how to measure them, and speed to lead covers the first call.

Funders reward ISOs who send clean files. A standard package is a signed application, the last three to six months of business bank statements (plus the current month to date), the owner's ID and a voided check, with existing positions and stips answered up front. Send each deal only to funders whose box it fits, and record every decline reason so you stop sending the next one to the wrong place. The MCA submission checklist is the full version.

The ISOs who last keep four lists current: leads by source, deals by stage, funders by criteria, and funded deals with expected and received commissions and a renewal date. A spreadsheet works for the first few deals; our Google Sheets layout is a sound starting point. When you add reps, buy leads in volume or work more than a handful of funders, move to an MCA CRM built for ISOs. Ours is $69 per user per month, with the $999 setup fee waived during our introductory offer.