Factoring Industry Targets MCAs at Federal Level: What Business Owners Need to Know

If you're a business owner struggling under the weight of merchant cash advance debt, you've probably wondered when someone would step in to regulate an industry that often feels like the Wild West. That moment may be closer than you think.

According to deBanked, the American Factoring Association, led by President Cole Harmonson, has announced plans to escalate their campaign against merchant cash advances to the federal level. This comes on the heels of new MCA regulations passed in Texas and Vermont, signaling a growing recognition that the MCA industry needs oversight.

Why the Factoring Industry Is Fighting MCAs

The factoring industry and the MCA industry often compete for the same small business customers, but their products work very differently. Factoring involves selling your accounts receivable at a discount to get immediate cash. MCAs, on the other hand, provide upfront capital in exchange for a percentage of your future credit card sales or daily bank account debits.

The tension between these industries has been building for years, with factoring advocates arguing that MCAs lack transparency and saddle businesses with unsustainable payment structures. The push for federal regulation suggests that factoring representatives believe federal oversight could level the playing field or rein in practices they view as predatory.

What Federal Regulation Could Mean for Your Business

While state-level regulations in Texas and Vermont represent progress, federal action could bring nationwide standards for disclosure, interest rate caps, and licensing requirements. For business owners currently trapped in MCA agreements, however, waiting for regulatory relief isn't a strategy. Federal rulemaking takes time, often years, and your business needs solutions today.

The reality is that whether or not new regulations pass, your existing MCA contracts remain binding. Daily or weekly debits continue draining your account, stacking fees compound, and the cycle of debt deepens. Regulatory changes typically don't apply retroactively to agreements you've already signed.

You Don't Have to Wait for Washington

If you're facing multiple MCA agreements, default notices, or daily debits that leave nothing for payroll and operating expenses, you have options right now. Business debt settlement has helped thousands of business owners break free from MCA debt without waiting for the legal landscape to shift.

Business Debt Adjusters has spent 11 years specializing in MCA relief, resolving over $500M in business debt for companies just like yours. With nearly 200 Trustpilot reviews and a 4.9-star rating, we've built our reputation on getting real results for business owners who thought they were out of options.

How Business Debt Settlement Works

Unlike waiting for regulatory changes or trying to refinance your way out of trouble, business debt settlement addresses your existing MCA obligations directly. The process involves negotiating with your MCA providers to reduce the total amount owed, often significantly, and creating a manageable payment structure that lets your business breathe again.

Every situation is different. The amount you owe, the number of MCA agreements you're juggling, your current cash flow, and your business's specific circumstances all factor into the strategy. That's why the first step is always a conversation, not a commitment.

Take Action While the Industry Fights It Out

The factoring industry's move to involve federal regulators is a sign that the problems with merchant cash advances are being recognized at higher levels. But recognition doesn't pay your bills or stop the daily debits. Your business can't afford to wait for policy debates to resolve.

If MCA debt is crushing your business, the time to act is now. Book a free consultation to see where you stand. There's no obligation, just an honest assessment of your situation and the options available to you. While industries and regulators argue about the future of MCAs, you can start building a path out of debt today.

If daily MCA withdrawals are already straining your cash flow, see how business debt settlement works, and for the verified numbers behind the industry, our merchant cash advance statistics page.