You’re running a business. You’re juggling staff, inventory, taxes, maybe even your sanity. Somewhere along the way, you signed a Merchant Cash Advance (MCA) agreement – one of those “quick cash, daily repayment” deals that sounded like a lifeline but feels more like a mob shakedown.
You finally thought you had a plan: refinance with a low-interest SBA 7(a) loan, and send those MCA gremlins packing. But as of June 1, 2025? Forget it. The SBA basically just told everyone with MCA debt: “You can’t sit with us.”
According to the updated SBA Standard Operating Procedures, you are no longer allowed to use 7(a) loan proceeds to refinance MCA or factoring agreements. Whether it’s SBA Express, Export Express, or your good ol’ classic 7(a) loan – it doesn’t matter. MCA debt is now persona non grata.
Official statement: “Merchant cash advances and factoring agreements are not eligible for refinancing with 7(a) loan funds.”
– SBA SOP Update, June 2025 (Source: DeBanked)
On the surface, letting businesses refinance high-interest MCA debt with cheaper SBA loans sounds reasonable. Who wouldn’t want to swap 300% APR for 10%? Many banks supported this strategy because it improved borrower health. But apparently, the SBA had other ideas.
Turns out, some borrowers were using their shiny new SBA loans to pay off MCAs… and then running straight back to the MCA dealer for round two. Like giving a sugar-addict a gym membership and watching them spend their first post-workout snack on donuts.
“A noticeable amount of businesses were funded with new MCA debt shortly after refinancing… which led to new defaults.”
– FastWay SBA Lending Advisor, June 2025
So what did the SBA do? It pulled the plug. No more bailouts for businesses hooked on the MCA juice. In their eyes, this “rehab then relapse” cycle was driving SBA loan defaults. So, instead of fixing the problem, they banned the treatment.
In short: everyone gets punished for the repeat offenders.
Let’s break down what this means for the 1,000s of small business owners already drowning in daily deductions:
We’re talking effective APRs from 40% to 350% – yes, triple-digit interest is not just a bad fever dream. And with daily or weekly payments, your business is essentially on financial life support.
“It’s like having a leaky faucet that drains money instead of water.”
Until now, the plan was simple: Use an SBA loan to refinance your MCA, then sleep again at night. Swap your 6-month daily-debit nightmare for a decade-long term loan with normal monthly payments. A beautiful thing.
But now? That door’s shut. Locked. Welded.
“Almost all business owners who have MCA loans are interested in refinancing with SBA loans.”
– FastWay SBA Blog, 2025
Since lenders can’t wipe out MCA debt with the SBA loan, they have to count your MCA payments when evaluating your application. That means your debt ratio may be too high to qualify – even if you’re just trying to get rid of the thing causing the problem.
“This will most likely result in more declines for businesses with MCA debt.”
– FastWay SBA Lender Quote
In other words: “Sorry, we can’t help you refinance your debt because you have… too much debt.”
The policy may have been aimed at reckless borrowers, but you are feeling the sting. This isn’t just an inconvenience – it’s a financial roadblock for responsible businesses trying to clean up their balance sheets.
Here’s the good news: While Uncle Sam is no longer lending a hand, you’re not out of options. You just need a smarter strategy (and a better partner). That’s where Business Debt Adjusters comes in.
You don’t have to borrow more to fix this mess. BDA helps you restructure your current MCA obligations – negotiating directly with creditors to adjust terms, spread out payments, and reduce the day-to-day pressure.
Think of it as hitting pause on the bleeding, not just bandaging over it.
You won’t get SBA’s 10-year term, but you will get breathing room – and possibly lower payments that won’t kill your cash flow.
Sometimes, the best way out is to pay less. With MCA settlement, we negotiate on your behalf to reduce your total owed balance – often significantly – in exchange for a lump sum or structured plan.
It’s not a myth. Lenders would often rather take a slice now than get nothing if you shut down. But you need experts to do the talking – MCA lenders aren’t exactly known for playing nice.
“It’s like hiring a skilled divorce attorney – the only difference is, the ex is your debt.”
MCAs became popular because they’re fast, but you’re not stuck with them forever. BDA helps businesses:
We’ll even help you prepare for SBA 504 loans or other routes not blocked by the June rule.
This new SBA rule may feel like the final slap in a long series of financial gut punches – but there is a way forward. Business Debt Adjusters has helped businesses in retail, restaurants, healthcare, logistics, construction, e-commerce, and more take back control from MCA chaos.
Let us do the same for you.
Learn real-world strategies to deal with debt and recover. Our guide walks you through every step:
Download “Breaking Free from Business Debt”
Talk to someone who gets it. No sales pressure. Just a one-on-one chat about your debt situation – and how to fix it. Get Your Free Consultation Here
This SBA move? It stings. But satire aside, your business isn’t doomed. You just need a strategy that doesn’t rely on government bailouts or triple-digit APRs.
At Business Debt Adjusters, we’re here with solutions, not judgment. We’ll help you get out, clean up, and rebuild – one smarter decision at a time.
Hang in there. We’ve got you.
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