Banana’s funding model is not a loan but rather a factoring transaction. In this arrangement, Banana purchases a portion of a Merchant Cash Advance Funder’s (MCA) Receivables to Repay (RTR) and advances 25% to 40% of that purchased RTR. This advance is then repaid, along with Banana’s fee, in 12 equal monthly payments. Here’s an illustrative example:  

  • Banana buys $4M in RTR from the MCA. 
  • Banana advances the MCA $1M (25%) in funding. 
  • With a 17% fee, the MCA will repay the $1M advance plus a $170K fee over 12 months, amounting to $97,500 each month. 
  • The MCA continues to collect the remaining $4M RTR as usual. 
  • The MCA may be required to sell Banana Exchange additional RTR to replace some of the collected amount, if the ratio between your outstanding balance and the remaining RTR is over 50% (link to “What is the Collection Ratio”). 


  1. You must have been an MCA funder for at least 6 months and currently own at least $1,000,000 in current RTR.
  2. You must not have any Liens / UCC-1 filings on your RTR.  
  3. You must collect daily or weekly from your MCA deals mainly via ACH 
  • No. We require that you have at least $1,000,000 in current RTR generated from your own funds. If you are looking to increase your RTR, you can find deals to fund by joining the Banana Marketplace. 
  • In certain cases – yes. We will work with you to understand your situation and try to work around it. In some case, we can help you remove the lien. Alternatively, if the lien was filed against a relatively small loan, we may also be able to work around this by requiring some more assurances from you.  
  • No. However, we won’t purchase RTR coming from such deals.  
  • If consistent ACH payments are not maintained, any RTR we’ve purchased will become ineligible. In such a case, you will be required to replace that RTR with another one that adheres to ACH collections.   
  • Yes, you can draw funds from us any time you generate new RTR. We will purchase this new RTR and provide additional advances each time. Engaging in this process can create a positive growth cycle for you, particularly when the funds received are used to create more RTR. 
  • Our fees are set at 17% or a 1.17 factor rate. This rate is applied to the amount we fund to you, and it represents the total cost of the funding. 
  • No. Our fees are not APR as we fund via Factoring, not lending 
  • Yes, you may repay your balances at any point, though our fee is non-refundable.  

Banana Exchange will only purchase RTR that meets its eligibility criteria: 

  1. The RTR must be spread out among merchants in different states and industries. If there is more than 25% state or industry concentration, some RTR in that state or industry may not be eligible.
  2. The RTR must be collected via ACH and the merchant must demonstrate consistent payments.
  3. The current RTR from any one merchant at time of purchase must be lower than $70K. If it is above $70K, only the first $70K will be recognized and counted. If several merchants have the same owner, they will all be limited together to $70K. 
  • If some of your RTR is not eligible you will have to send us more to replace the ineligible RTR or settle for a smaller advance from us. For example, if you provided us with $4M in RTR, expecting a $1M advance, and $500K turned out to be ineligible, you can either provide us an additional $500K to replace it, or settle for a smaller advance of $875K for the $3.5M eligible RTR.  
  • We don’t mind that syndicates participate in RTR you wish to sell us. However, it will be your responsibility to speak with the syndicates and update them about your agreement with Banana Exchange. One of our pre-requisites for funding is that we place a lien / UCC-1 on your assets. This means that if you default, we will have first right to collect any outstanding balances from your RTR, before any of your syndicates.  
  • As we are purchasing your RTR in exchange for our funding, the RTR acts as our collateral in case you default. For this reason, we need to make sure this RTR is not in default. We do this by connecting to your ACH Provider and reviewing the collection history of each merchant. We also continue monitoring your RTR after we fund. If we notice a merchant has stopped paying, we will disqualify them, thus reducing the amount of your eligible RTR. 
  • We require an API connection to your ACH Provider as our system will be monitoring the ACH transactions automatically. This connection can be read-only – we never touch any of the transactions you set up. You will need to request a read-only API key for us from your ACH Provider’s support. 
  • No, we never create, delete, change or interfere with any of your transactions or ACH setups. We only monitor the transactions and therefore only require read-only access to your ACH. 
  • No. You can continue to collect your RTR normally, directly to your own bank account. We don’t control your funds. 
  • Protecting your merchant information is a top priority for us, and we guarantee it will never be sold or shared with outside parties. Our commitment to ethical business practices includes strong measures to ensure data security. We utilize Microsoft’s SharePoint to create a secure private cloud environment, and only a select few members of top management have access to your data. We understand that the trust and reliability we build with our MCA clients are vital to our success, and we are dedicated to maintaining the highest standards of integrity and confidentiality. 
  • The Collection Ratio is a measure associated with each funding round you receive from us. It represents the balance of that funding round divided by the amount of eligible RTR (Receivables to be Received) we’ve purchased. Initially, this ratio starts off between 28-30%. For example, if you receive $1M in funding with a 17% fee and provide us with $4M in RTR, your initial Collection Ratio will be ($1M * 1.17) / $4M = 29.25%. An MCA’s funding ratio must remain at or below 50% until the advance is paid back. 

Your Collection Ratio fluctuates based on repayments and collections: 

  • It decreases every time you make a repayment to us, reducing your balance. 
  • It increases every time you collect some of the RTR we purchased, or if a merchant’s default renders their RTR ineligible. 

Typically, the rate at which the Collection Ratio decreases is slower than the rate it increases. This is because our funding is usually repaid over a year, while the RTR we purchase will generally be collected by you in several months. 

Here’s an example to illustrate: Suppose you received $1M in funding with a 17% fee (starting balance $1.17M), and you provided us with $4M in RTR (29.25% Collection Ratio). If you collect $500K of the $4M every month, then after six months, only $1M of RTR will remain. Simultaneously, you will have made 6 out of the 12 repayments to Banana Exchange, reducing your balance to $565K. Your Collection Ratio will thus be $565K / $1M = 56.5%. 

Please note that if your Collection Ratio exceeds 50%, it may require adjustments or further actions to align with our funding requirements. Feel free to reach out to our support team if you have specific questions about this process.

  • If you default, we will collect the remaining balance due out of the RTR. Since we don’t control your bank accounts or ACH transactions, we sign a tri-party agreement with you and your ACH Provider, giving us the right to divert your ACH collections to our bank account in case of default. We will collect your remaining balance, along with any fees, and divert any additional ACH collections back to you.