Stacking and payment burden

Positions are not the problem by themselves; payments are. A merchant with two small advances can be safer than one with a single large daily debit. The CRM measures burden as a share of true revenue, the way most underwriters do, so the same deal reads the same way on the statements tab, in the matrix and on every offer.

• StackingStacking means a merchant takes more than one cash advance at the same time, so several funders debit the same bank account and the combined holdback climbs.
• PositionsA position is one open cash advance on a merchant's account, numbered in the order taken: first position, second position and so on.
• HoldbackHoldback is the share of a merchant's revenue that goes to repaying a cash advance, either a fixed split of card sales or the effective share taken by fixed ACH payments.

existing holdback %   = existing monthly advance payments / monthly true revenue x 100
room for new payment  = (amber line % x revenue - existing monthly payments) / business days
combined holdback %   = (existing monthly payments + new monthly payment) / revenue x 100

Example: revenue $72,000 a month, one advance at $220 a day, so $4,620 a month. Existing holdback is 4,620 / 72,000 = 6.4%. With the amber line at 15%, room for a new payment is (10,800 - 4,620) / 21 = $294.29 a business day. An offer at $359.18 a day goes past it, and its combined holdback is 16.9%: amber.

• `Bank statements` tab: tiles for Positions, Existing MCA / mo, Holdback (colored by your lines) and Room for new payment per business day.
• Risk flags under those tiles: 3+ existing positions and Existing holdback at or above 25%, alongside the NSF, negative-day, declining-revenue and low-balance flags.
• Match matrix: the Holdback column checks lenders' holdback rules, and the recommended amount is capped by payment room.
• Offer dialog: the Affordability box shows Holdback (this offer) and Combined with existing, with a badge: Comfortable, Tight or Over limit.

1. 1Go to Settings → Organization, section Deal math defaults.
2. 2Set Affordability amber at (default 15%) and Affordability red above (default 25%), both as combined holdback of revenue.
3. 3Check Business days per month (default 21). Lenders with their own convention override it.
4. 4Click Save changes.

The amber line also sets the room-for-new-payment figure. The red line is the default target the matcher uses for the recommended amount when a lender has no holdback rule of its own. Only the account owner can change these settings.

When the new advance pays off existing positions, switch each one to Pay off with the new advance and enter the total in the offer's Payoffs. The positions drop out of the count and the existing payments, so lender limits and the combined holdback reflect the merchant after funding, and the net to merchant shows the cash that is actually left.

• Check the statements for advance debits you were not told about before trusting the position count.
• A merchant already in red rarely gets better with another position. Consider a consolidation or a longer term.
• Keep notes on why you went ahead with a heavy stack in Major issues on the Underwriting tab.