News & Analysis as of

Merchant Cash Advance (MCA)

Goodwin

Payday and Small-Dollar Lending - March 2026

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Welcome to the eighth chapter of our annual report, Consumer Financial Services: 2025 Year in Review. In 2025, the Consumer Financial Protection Bureau (CFPB) reduced its scrutiny of small-dollar lenders by publicly...more

Offit Kurman

Deal Structures Under Stress: Courts Reexamine Prebankruptcy Transactions

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According to data from Epiq Bankruptcy, February 2026 marked a significant increase in commercial bankruptcy activity. Commercial Chapter 11 filings rose by 67% year over year, while Subchapter V elections by small businesses...more

Davidoff Hutcher & Citron LLP

DHC Defeats MCA Funders in Bankruptcy Court

If your restaurant is carrying merchant cash advance debt with triple-digit implied interest rates, pay attention. Our bankruptcy team just secured a major victory that changes the landscape for MCA litigation—and it has...more

Falcon Rappaport & Berkman LLP

A Cold Shoulder for MCA Vendors in Bankruptcy Court

Merchant cash advance (“MCA”) providers have long relied on form agreements and carefully chosen labels—purchase of future receivables, not a loan, no fixed term—to insulate their products from usury laws and borrower...more

Hudson Cook, LLP

New York Criminal Usury as a Claim in Bankruptcy

Hudson Cook, LLP on

A merchant bankruptcy poses several dangers for revenue-based commercial funders. Most obviously, from a business standpoint, bankruptcy disrupts the merchant's ongoing revenue generation and the transfer of revenue to the...more

Pullman & Comley, LLC

When Is a Merchant Cash Advance Really a Loan? Bankruptcy Implications for Business Owners and MCA Funders

Pullman & Comley, LLC on

Merchant cash advances (“MCAs” or singularly an “MCA”) have become an increasingly popular financing option for small and mid-sized businesses that may not qualify for traditional bank loans. ...more

Troutman Pepper Locke

Payments Year in Review 2025: Federal and State Developments – Part 2 – Payments Pros – The Payments Law Podcast

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In the second installment of the two-part Payments Year in Review series, hosts Keith Barnett, Carlin McCrory, and Jason Cover focus on the state-level developments that shaped the 2025 payments landscape and will influence...more

Husch Blackwell LLP

Alternative Commercial Finance Monthly | December 2025

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The compliance calendar just got complicated. Welcome to 2026. If you're hoping for regulatory clarity, we have bad news. The compliance calendar we'd all been planning around has turned into something closer to a...more

The Rodman Law Group, LLC

Southern District of New York Finds Merchant Cash Advance Financier (“MCA”) Really Operated as Disguised Lender

For those operating in the MCA space, New York federal and state courts hold a preeminent role in guiding FinTech companies to structure non-loan products in ways that are alternative, at times clever, yet legally compliant....more

Mayer Brown

Louisiana Now Requires Disclosures for Revenue-Based Financing Transactions

Mayer Brown on

Effective August 1, 2025, Louisiana will subject revenue-based financing transactions to new disclosure requirements, joining the still-growing ranks of states passing commercial finance disclosure laws in recent years. But...more

Troutman Pepper Locke

Texas Enacts New Commercial Sales-Based Financing Bill Severely Restricting Automatic Debits

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On June 20, the Texas Legislature passed H.B. 700, which introduces several new regulatory requirements for providers and brokers of commercial sales-based financing operating within the state. The law applies to merchant...more

Eversheds Sutherland (US) LLP

Preference pitfalls for Merchant Cash Advances—Lessons from the Southern District of New York

Merchant cash advance (MCA) funding provides a quick, “non loan” alternative for small businesses desiring to access additional capital, and its use has become prevalent in the last decade. Given the speed at which MCA...more

Sheppard, Mullin, Richter & Hampton LLP

CFPB Small Business Lending Data Rule Survives Challenge in Federal Court

On February 19, a federal magistrate judge for the United States District Court for the Southern District of Florida issued a report and recommendation rejecting a trade group’s challenge to the CFPB’s small business lending...more

Orrick, Herrington & Sutcliffe LLP

New York Attorney General secures $1B settlement with merchant cash advance lenders

On January 16, the New York State Attorney General (AG) filed a consent order in the Supreme Court of the State of New York involving lending companies and its officers (the respondents) accused of predatory lending of...more

Latham & Watkins LLP

NY Attorney General Secures $1 Billion-Plus Judgment for Illegal Loans Misrepresented as Merchant Cash Advances

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On January 22, 2025, New York Attorney General (NYAG) Letitia James announced a judgment and settlement against cash advance provider Yellowstone Capital, its officers, and two dozen affiliates (Yellowstone) for more than $1...more

Hudson Cook, LLP

Yellowstone Capital Settles Lawsuit with New York Attorney General

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On January 16, 2025, Yellowstone Capital and other entities, along with Yellowstone officers Isaac Stern and Jeffrey Reece, settled claims by New York Attorney General Letitia James that Yellowstone and the other entities...more

Troutman Pepper Locke

New York Attorney General Settles $1 Billion Lawsuit Against Yellowstone Capital Over High-Interest Loans

Troutman Pepper Locke on

On January 22, New York Attorney General Letitia James announced a significant settlement with Yellowstone Capital of New Jersey and its affiliated companies over allegations of illegal high-interest loans disguised as...more

Sheppard, Mullin, Richter & Hampton LLP

FTC and DOJ File Amended Complaint Against Cash Advance Fintech

On December 30, the Department of Justice (DOJ), at the Federal Trade Commission’s (FTC) referral, filed an amended complaint against an online cash advance provider. The complaint now names the company’s CEO as a defendant,...more

Troutman Pepper Locke

The Evolving Landscape of B2B Payments: Regulatory Trends and Financial Practices Explained — Payments Pros – The Payments Law...

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In this episode of Payments Pros, host Josh McBeain is joined by Caleb Rosenberg, a member of the firm’s Consumer Financial Services practice group, to discuss the complexities of business-to-business payments and the...more

Shipman & Goodwin LLP

Merchant Cash Advance Litigation In Connecticut

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The recipients of some merchant cash advances have an opportunity to defend, and even counterclaim for treble damages and attorneys’ fees, when funders of certain loans characterized as merchant cash advances sue them in...more

Wilson Sonsini Goodrich & Rosati

Revenue Purchase or Predatory Loan? New York Attorney General Targets Merchant Cash Advance Providers

On March 5, 2024, the New York Attorney General (AG) Letitia James sued Yellowstone Capital LLC (Yellowstone) and various affiliates, accusing them of running a predatory lending operation by disguising the loans as purchases...more

Troutman Pepper Locke

New York AG Sues Yellowstone Capital Over Alleged “Fraudulent Loans” Targeting Small Businesses

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New York Attorney General (AG) Letitia James filed a lawsuit on March 5 against Yellowstone Capital, its founder David Glass, and a network of 30 other affiliated companies and individuals. James alleges that Yellowstone...more

Sheppard, Mullin, Richter & Hampton LLP

New York Attorney General Brings $1.4 Billion Lawsuit Against Merchant Cash Advance Lenders

On March 5, the New York Attorney General filed a lawsuit against a network of over 30 lending companies and their officers alleging their involvement in a predatory “merchant cash advance” lending scheme that exploited New...more

Orrick, Herrington & Sutcliffe LLP

New York State Attorney General wins $77 million judgment against short-term lenders for predatory lending

On February 8, New York State Attorney General (AG) Letitia James announced a more than $77 million judgment against three merchant cash advance (MCA) companies for usury and fraud based on allegations the lenders used...more

Troutman Pepper Locke

New York AG Secures $77M Judgment With Merchant Cash Advance Companies

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On February 8, New York attorney general (AG) Letisha James announced a $77 million judgment with three merchant cash advance (MCA) companies, Richmond Capital Group, Ram Capital Funding, and Viceroy Capital Funding, and...more

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