When you can’t make your daily MCA payment, you have more options than the funder wants you to know about. But every option has tradeoffs, and the wrong move can make your situation drastically worse — within hours, not weeks.
Short answer: The main MCA payment relief options are reconciliation (built into most contracts), restructure (negotiating a lower daily/weekly payment), settlement (paying a lump sum for less than you owe), consolidation (combining multiple MCAs — almost always a trap), forbearance (a short pause), and bankruptcy (Subchapter V is the one most MCA holders qualify for). Each one has a use case. Each one has a way it can blow up on you.
If you’re behind, or you can already see you’re going to be behind in the next 14 days, read this all the way through before you call your funder.
What does “payment relief” actually mean with an MCA?
It means anything that reduces, pauses, restructures, or eliminates the daily/weekly debit hitting your bank account. That’s it. Relief can come from the funder voluntarily, from a negotiated deal, from court intervention, or from bankruptcy. It does not, in most cases, come from federal consumer protection law — because MCAs aren’t consumer loans, and you don’t have those protections. This matters. Every relief option is a private negotiation, or a legal proceeding. Nobody is coming to save you.
Option 1: Reconciliation
This is the one almost nobody uses, even though it’s written into the contract. Most MCA agreements have a reconciliation clause that says — if your actual revenue drops, the daily payment can be adjusted down to match your real receivables. That’s the whole theory of an MCA — it’s a “purchase of future receivables,” not a loan, and the payment is supposed to flex with revenue.
In practice, funders make this hard on purpose. You’ll need to submit bank statements, processing statements, sometimes a sworn affidavit, and the funder will drag the process out. But it’s free, it’s contractual, and it doesn’t put you in default. If you’re seeing a real revenue drop, this is the first thing to try.
The catch: many funders will deny it for any reason they can find, and some will use the request itself as a flag to start watching your account.
Option 2: Restructure
This is when you call the funder, and negotiate a lower daily, or a switch from daily to weekly, in exchange for a longer term. Sometimes the funder will agree — especially if you’re a good account, that’s just hit a soft patch. Sometimes they won’t even pick up the phone.
Restructures work best before you’ve missed a payment. Once you’ve defaulted, the leverage flips, hard.
The catch: restructures often come with a higher total payback, additional fees, or a personal guarantee strengthening. Read every word.
Option 3: Settlement
This is what we do at Delancey Street. Settlement means negotiating with the funder, or their attorney, to accept less than the full balance — sometimes as a lump sum, sometimes as a structured payment plan over 6 to 24 months.
Settlement makes sense when the balance is big enough that paying it in full would close the business, when you have multiple MCAs stacked, or when the funder has already accelerated and is suing you. Funders settle because something is better than nothing, and they know it.
The catch: settlement requires you to be in, or near, default to have any leverage at all. A current account, in good standing, has zero settlement leverage. You also need somebody who knows the specific funder, their attorneys, and what they actually accept — generic “debt relief” companies will get you settled for far more than you should pay.
Option 4: Consolidation
A consolidator promises to take all your MCAs, and roll them into one payment. This is, in almost every case I’ve seen, a trap. The “consolidation” is usually a new MCA stacked on top of the old ones, with the consolidator making daily withdrawals that are supposed to fund the original MCA payments. When it works, it’s a temporary cash-flow patch. When it doesn’t work — which is most of the time — you now have all your old debt, plus a new one, plus you’ve defaulted on everything at once.
There are legitimate consolidators. There are far more illegitimate ones. The math almost never works in the merchant’s favor.
The catch: it’s not really consolidation. It’s stacking, with extra steps.
Option 5: Forbearance
Forbearance is a short pause — usually 1 to 4 weeks — where the funder agrees to stop debiting while you stabilize. Some funders offer this. Most don’t, unless you have a very specific reason (natural disaster, medical, processor switch).
The catch: the missed payments don’t disappear. They get tacked on, often with fees. And asking for forbearance puts you on the funder’s radar as a problem account.
Option 6: Bankruptcy
The nuclear option, but not as nuclear as it sounds. Subchapter V of Chapter 11 was created specifically for small businesses, and it’s faster, cheaper, and far more flexible than traditional Chapter 11. For a business with $7.5M or less in debt, it can wipe out, restructure, or pay down MCA debt over 3 to 5 years — often at pennies on the dollar.
Chapter 7 liquidates the business entirely. Chapter 11 (regular) is expensive, and slow. Subchapter V is the sweet spot for most MCA-burdened small businesses.
The catch: bankruptcy is public, it affects your credit, it takes 60 to 90 days minimum to file properly, and the personal guarantee on most MCAs means you may also need a personal Chapter 7 or 13 to fully clean it up.
Can I get MCA relief if I’ve already defaulted?
Yes, but the menu shrinks. Reconciliation, restructure, and forbearance are mostly off the table once you’ve defaulted — the funder has no reason to give you those when they can just accelerate the balance, and sue. What’s left is settlement, and bankruptcy. Both still work, in many cases, work better after default than before, because the funder finally has a reason to take you seriously.
Which option is right for you?
Depends on three things: how many MCAs you have, whether you’ve already defaulted, and whether the business is fundamentally viable. A one-MCA, currently-paying business with a temporary dip needs reconciliation, or restructure. A three-MCA stack, with a recent default, needs settlement, fast. A business that’s not coming back needs to stop throwing money at MCAs, and talk to a bankruptcy attorney.
The worst thing you can do is nothing. The second worst thing is to take another MCA, to pay the existing ones — that’s how an $80K problem becomes a $400K problem in 90 days.
