ACH Authorization: Meaning in a Merchant Cash Advance
An ACH authorization is your written permission for the funder to debit your business bank account on a schedule. It's what makes daily or weekly payments automatic. Changing the account or amount needs the funder's agreement. Revoking it on your own is usually an event of default, even when your bank lets you do it.
Where does it show up?
A separate form or a section of the contract, naming the bank, account and routing numbers and the debit amount or method.
What does it look like in practice?
You switch banks. You sign a new authorization for the new account, the funder confirms the date, and the first debit clears before you close the old account. See changing bank accounts.
Which owner question goes with this term?
Can I change bank accounts during an MCA? Answers to the questions owners ask about this term, with what to ask the funder.
Why keep a copy of your ACH authorization?
Save the authorization you signed with the contract. It names the account, the amount or how the amount is set, and how to change it. You'll want it if you switch banks or the debit ever looks wrong.
A term on your offer you don't recognize?
Send us the line and we'll tell you what it means. Call 877-FUND-654 with any question. We call you back, usually the same business day, and we always talk with you before we shop your file.