Every Term, in Two Sentences.
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Average daily balance
The average amount held in the business bank account across the days of a month. Funders read it beside deposits: two businesses with the same sales get different offers when one keeps a cushion and the other runs near zero. Read more
Confession of judgment
A document in which a business owner agrees in advance that a funder can obtain a court judgment if the business defaults. Several states restrict their use, so read any agreement that contains one carefully before signing. Read more
Cost of capital
What the funding costs in dollars: the payback amount minus the amount funded, plus any fees. On a $50,000 advance with a $67,500 payback amount, the cost of capital is $17,500. Read more
Debt service coverage ratio
A business's net operating income divided by its yearly debt payments. Lenders use it on term and SBA loans to check that the business earns enough to carry the new payment beside what it already owes. Read more
Deposits
The money that lands in the business bank account each month, less transfers between your own accounts, loan proceeds and refunds. It is the number most funding is sized on. Read more
Draw
Money taken from a line of credit. Interest runs only on what has been drawn and is still outstanding, and repaid amounts can be drawn again. Read more
Equipment financing
A loan to buy a vehicle, machine or buildout in which the equipment itself is the collateral. The business repays it in fixed payments and owns the equipment at payoff. Read more
Estimated APR
The cost of funding expressed as a yearly rate, so offers with different terms and structures can be compared. Every Batch Capital offer shows it beside the factor rate, because the same factor repaid faster costs more per year. Read more
Factor rate
The number a merchant cash advance's payback amount is set by: the advance times the factor. Factors on our panel ran 1.25 to 1.50 as of September 28, 2026. Read more
Hard inquiry
A credit check recorded on a credit report when a lender reviews credit to make a lending decision; it can lower a score for a while. Checking options with Batch Capital uses a soft inquiry instead. Read more
Holdback
On a merchant cash advance repaid from card sales, the percentage of each day's card settlements that goes to the funder until the payback amount is reached. The payment rises and falls with sales. Read more
Line of credit
A set limit a business can draw from, repay and draw again, paying interest only on what is outstanding. It fits a cash gap that comes back, like payroll ahead of slow receivables. Read more
Merchant cash advance
A purchase of part of a business's future sales: the funder pays a lump sum now and collects a fixed payback amount from sales. It is not a loan, and its cost is set by a factor rate rather than an interest rate. Read more
Negative day
A day the business bank account closes below zero. Across our panel, up to 5 a month is workable as of September 28, 2026. Read more
NSF (returned item)
A payment the bank refused because the account did not have the funds. Across our panel, up to 5 a month is workable as of September 28, 2026; more narrows the funders who will look at a file. Read more
Payback amount
The fixed total a merchant cash advance collects: the advance times the factor rate. It does not grow with time, which is why paying early saves money only when the agreement offers an early payoff discount. Read more
Position
Where an advance sits among the funding a business already carries: the first advance is the first position, the next is the second. Every existing position is subtracted from what a new payment can be. Read more
Reconciliation
A provision in many merchant cash advance agreements that adjusts the fixed remittance to match actual sales when revenue falls. Ask whether an agreement includes one and how to request it before signing.
Remittance
The scheduled daily or weekly payment that repays a merchant cash advance from the business account. Its size is set by the payback amount and the term. Read more
Renewal
New funding offered partway through an existing advance or loan, usually after a stretch of on-time payments. A renewal that pays off the old balance means the cash you receive is less than the headline amount.
SBA 7(a) loan
The Small Business Administration's general loan program: up to $5 million for working capital, equipment, real estate or buying a business, per the SBA, over terms up to 10 years, or 25 for real estate. Read more
SBA 504 loan
The SBA program for real estate and major equipment: up to $5.5 million at a fixed rate, per the SBA, over 10, 20 or 25 years. Read more
Soft inquiry
A credit check that lets a funder see a credit file without the check affecting the score. Batch Capital's quiz and application use one. Read more
Stacking
Taking several merchant cash advances at once, each with its own remittance. It is the fastest way to strain cash flow, and every funder sees it on the statements. Read more
Term loan
A lump sum repaid in fixed payments, usually monthly, over a set term, with its cost stated as an interest rate and an APR. It fits a planned investment with steady deposits behind it. Read more
Time in business
How long the business has been depositing revenue in its own bank account. Our panel's floor is 3 months, with 6 typical, as of September 28, 2026. Read more
UCC filing
A public notice, filed with the state under the Uniform Commercial Code, that a funder or lender has a claim on certain business assets or receivables. Other funders check for UCC filings before they fund.
Underwriting
The review a funder or lender does before making an offer: bank statements first, then time in business, credit and what the money is for. It sets whether a file is funded, how much and at what cost. Read more
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