Commission
In MCA, commission is the percentage payment earned by a broker, ISO, or sales rep when a funded deal closes — typically calculated as a percentage of the funded principal amount, paid by the funder upon deal funding.
Why This Matters
Commission economics drive MCA distribution. Standard commission ranges: 5-12% on first-position deals, 3-8% on second-position, 8-15% on premium deals or specialty programs. Some funders pay tiered commission scales rewarding higher-volume ISOs. Residual commissions on renewals add 1-3% annual income on funded portfolios. For ISOs, commission economics determine which funders to prioritize on submissions — ISOs route deals to the funder offering best combination of approval likelihood, commission rate, and turnaround speed.
Frequently Asked Questions
Frequently Asked Questions
When is MCA commission paid?
Typically at funding — commission is wired to the ISO same-day or next-day after the merchant receives funding. Some funders defer commission pending merchant first-payment performance; others claw back commission on merchants who default within early-payoff windows.
Are commissions negotiable with funders?
Yes — for high-volume ISOs. Funders compete for ISO submission flow and offer enhanced commission tiers, exclusivity bonuses, and volume rebates to producers above certain thresholds. Solo brokers and low-volume ISOs typically get standard published commission rates.