MCA Default Rates: What the Published Data Actually Shows
Is there a merchant cash advance default rate? What public data exists, what one funder's SEC filing shows, why rates vary, and what to do if you are behind.
By Shai Tamam · Published · 8 min read
We could not find a published market-wide merchant cash advance default rate, and most funders are private, so they do not report one. The clearest public numbers come from the few funders that file with the SEC. One example is Shopify, which reports delinquency on its own loan and MCA book. In its Form 10-Q for the quarter ended September 30, 2026, Note 6, Shopify reported 91.1% of the gross balance of its loans and merchant cash advances as current and 6.0% as 180 or more days past due.
This page is general information, not legal or financial advice (reviewed Nov 9, 2026).
Last updated: November 13, 2026
Shopify's own loan and MCA book, from its SEC filing (not an industry rate)
What Shopify reported Figure Period Current, share of gross loan and MCA balances 91.1% As of September 30, 2026 30 to 89 days past due 1.5% As of September 30, 2026 90 to 179 days past due 1.4% As of September 30, 2026 180 or more days past due 6.0% As of September 30, 2026 Current / 180 or more days past due, same book 92.0% / 5.7% As of December 31, 2025 Gross loans receivable / gross merchant cash advances receivable $2,226 million / $370 million As of September 30, 2026 Loans and MCAs charged off, net of recoveries $166 million Nine months ended September 30, 2026 Source: Shopify Inc. Form 10-Q, quarter ended September 30, 2026, Note 6, Loans and Merchant Cash Advances (filed November 3, 2026). These are Shopify's figures for its own merchants. They combine loans and MCAs, measure dollars rather than businesses, and are not an MCA market average.
Is there an official MCA default rate?
Not that we could find. Nobody publishes one number for the whole market.
Most MCA funders are private and do not publish loss data. Public figures come from the few funders that file with the SEC, and those figures cover only their own books.
If you see a single MCA default rate quoted without a filing or regulator behind it, treat it as a guess.
What does public funder data show? (Shopify as one example)
Shopify provides loans and merchant cash advances to merchants on its platform. Its Form 10-Q for the quarter ended September 30, 2026 (filed November 3, 2026), Note 6, reports the delinquency status of the gross amount of its combined loan and MCA book:
- Current: 91.1%
- 30 to 89 days past due: 1.5%
- 90 to 179 days past due: 1.4%
- 180 or more days past due: 6.0%
As of December 31, 2025, the same note shows 92.0% current, 1.1% at 30 to 89 days, 1.2% at 90 to 179 days, and 5.7% at 180 or more days past due. Gross balances as of September 30, 2026 were $2,226 million in loans receivable and $370 million in merchant cash advances receivable. Loans and MCAs charged off, net of recoveries, came to $166 million for the nine months ended September 30, 2026.
How Shopify measures this: delinquency is based on the number of days past the contractual or expected repayment date. In the filing's words, "current" represents balances "anticipated to be repaid within 29 days of the contractual repayment dates, or are anticipated to be repaid within 29 days of the expected repayment date."
Keep the limits in mind. This is one company's merchants and underwriting. Loans and MCAs are combined, and MCAs are the smaller part. The shares are of dollars, not businesses. One funder's book on one date is not your odds, and it is not a rate for the MCA industry.
Why do reported MCA default rates vary so much?
- Definitions differ. "Default" in an MCA contract is a list of events (see MCA default and MCA events of default), not a days-late count.
- Delinquency buckets differ. Shopify reports 30 to 89, 90 to 179, and 180 or more days. A 30 days and over figure and a 180 days and over figure are different numbers.
- No fixed due date. Remittance follows sales, so lateness is measured against an expected repayment date.
- Reconciliation. When sales drop, a reconciliation can lower remittance under many agreements, so a slower payer may not be "late."
- Dollars vs deals. A share of balances is not a share of businesses.
- Charge-off timing. Write-offs come later than default.
- Point in time vs lifetime. Today's snapshot is not the share of all advances that ever fail.
- Mix. Books that combine loans and MCAs, or many vintages, blend results.
Two funders can describe the same merchant differently. One calls it default, the other a slow month.
Default vs delinquency vs charge-off: what is the difference?
| Delinquency | Default | Charge-off | |
|---|---|---|---|
| What it means | Behind the contractual or expected schedule, in days | A listed event of default has happened | Funder writes the balance off as a loss |
| Who decides | Schedule or expected date | The agreement | The funder's accounting policy |
| Can it reverse? | Yes, if payments catch up or remittance is reconciled | Sometimes, if cured or waived | Collection can continue; recoveries reported separately |
| Does the debt go away? | No | No | No. A write-off is accounting, not forgiveness |
| Read more | MCA remittance | MCA default | MCA debt collection |
What should I do if I am behind on an MCA?
- Read the default, remittance, and reconciliation sections of every agreement.
- Build remittance-to-date from bank statements and compare it to the funder's figure.
- If sales dropped, ask in writing whether reconciliation is allowed. See MCA reconciliation.
- Save every notice with the date you received it.
- Talk to the funder before a debit bounces, if you can. See MCA pre-default options.
- If today's pace cannot work, see MCA debt restructuring. If paying in full is not realistic, see MCA debt settlement and business debt settlement.
- Do not block debits or switch accounts on your own. Get licensed counsel first.
For contract-level default meaning, see our MCA default guide.
Can a default rate tell me what will happen to my business?
No. A book-level number says nothing about your contract, sales, or funder choices. Your agreement, remittance history, and cash flow are what count. After a declared default, see what happens after an MCA default.
Key terms
- Merchant cash advance (MCA): a lump sum paid now in exchange for a share of future sales up to a set amount.
- Delinquency: payments behind schedule, in days past the contractual or expected repayment date.
- Days past due buckets: ranges like 30 to 89 days used to group late balances.
- Current: on schedule. In Shopify's filing, expected repayment within 29 days of the contractual or expected repayment date.
- Default: an event the agreement lists, such as failed remittance or a blocked debit.
- Charge-off: the funder writes the balance off as a loss. The debt is not forgiven.
- Recovery: money collected after a charge-off.
- Allowance for credit losses: the reserve set aside for amounts the funder expects not to collect.
- Expected repayment date: the date a funder projects payoff based on expected sales.
- Reconciliation: an adjustment of remittance to actual sales, where the agreement allows it.
Frequently asked questions
What is the default rate on merchant cash advances?
We could not find a published market-wide MCA default rate. Some SEC filers report figures for their own books. In its 10-Q, Note 6, Shopify reported 91.1% of its gross loan and MCA balances as current and 6.0% as 180 or more days past due as of September 30, 2026. Those are Shopify's own numbers, not an industry rate.
Why can't I find one official MCA default rate?
Most MCA funders are private and do not publish loss data. The public figures that exist come from the few funders that file with the SEC, and they describe only those funders' own books.
What does Shopify's delinquency data show?
Shopify's 10-Q for the quarter ended September 30, 2026, Note 6, showed 91.1% of gross loan and MCA balances current, 1.5% at 30 to 89 days, 1.4% at 90 to 179 days, and 6.0% at 180 or more days past due as of that date. That is Shopify's own book, with loans and MCAs combined, not a market average.
What is the difference between MCA default and delinquency?
Delinquency means payments are behind the contractual or expected schedule, in days. Default is an event your agreement lists, such as failed remittance or a blocked debit. You can be delinquent without a declared default.
Does a charge-off mean I no longer owe the MCA?
No. A charge-off is an accounting write-off. Collection can continue, and recoveries are reported separately. Read your agreement and get licensed counsel before assuming any balance is gone.
Why do MCA default numbers vary so much between sources?
Sources use different default definitions, days-past-due buckets, dollars or deal counts, and snapshots or lifetime results. MCAs have no fixed due date, so lateness is measured against an expected repayment date.
What should I do if I am falling behind on an MCA?
Read your default and reconciliation terms, rebuild remittance from bank statements, and save every notice. Ask in writing about reconciliation if sales dropped. Talk to the funder early, and get licensed counsel before changing accounts or debits. This is general information, not legal advice.
Sources
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