No two funders draw the lines in the same place, so the letters describe a direction rather than a category. What they reliably encode is that price and term move together with risk: better paper gets a lower factor, a longer term and a larger advance, and everything else is a trade against one of those three.
| Grade | Typical profile | What it gets |
|---|---|---|
| A | 2+ years trading, strong balances, no positions, clean months | Lowest factors, longest terms, largest advances |
| B | Solid business, maybe one position or a couple of negative days | Moderate pricing, standard terms |
| C | Multiple positions, thinner balances, shorter time in business | Higher factors, shorter terms, smaller advances |
| D | Heavy stacking, frequent negatives, distressed | Expensive, short, and often better declined |
What moves a file down a grade
- Each additional position, and more sharply than most brokers expect.
- Negative days, especially a pattern rather than an incident.
- A balance that the proposed remittance would routinely empty.
- Time in business under a year, regardless of how good the numbers are.
- A restricted or high-risk industry, which can cap the grade whatever the file looks like.
What moves a file up
Very little, quickly. Paying off a position genuinely improves the file and is worth suggesting where the merchant can. Beyond that, the honest levers are resizing the ask to something the balance supports, providing context for an anomalous month, and waiting — a merchant three months from their two-year mark is a materially better file in three months.
This is also why lead quality shows up as paper quality. Leads screened to businesses over $30,000 a month with six months trading produce more B paper and less D than unscreened ones, and the difference lands in your average factor and your funded rate rather than in anything you would notice on the call.
Questions brokers ask
What does A paper mean in merchant cash advance?
A clean file — a business trading two years or more, strong average daily balances, no existing positions and no negative days. It earns the lowest factors, the longest terms and the largest advances.
Are MCA paper grades standardised?
No. Every funder draws the lines differently, so the letters describe a direction of travel rather than a fixed category. That is precisely why placement — knowing which funder writes which paper — is a real skill.
What moves a file down a grade fastest?
Additional positions, and more sharply than most brokers expect. After that, a pattern of negative days and a balance the proposed remittance would routinely empty.
Can a merchant improve their paper grade?
Somewhat. Paying off an existing position genuinely helps, and so does resizing the ask to what the balance supports. Otherwise the honest answer is often time — a merchant approaching two years trading is a better file for waiting.
Does paper grade affect the broker’s commission?
Indirectly and substantially. Better paper funds larger advances at longer terms, and points on a bigger advance are worth more, so leads that produce better paper pay a broker twice over.
Alex Makowski
Founder, Infinite Bookings
Runs the lead generation operation behind Infinite Bookings — paid traffic, the funding application, and the delivery pipeline that puts records into brokers’ CRMs.
Reachable directly at alex@infinitebookings.com or 732-609-7182.