Holdback
The percentage of daily card sales or bank deposits a funder takes until the advance is repaid.
Typically somewhere between 5% and 20%. Because it is a percentage rather than a fixed sum, repayment flexes with revenue — slower in a bad week, faster in a good one. That flexing is the feature that distinguishes a true advance from a loan, and it is the first thing a court looks at when deciding whether a transaction has been mischaracterised.
Why it matters to a broker
A holdback that never varies regardless of receipts is one of the features regulators point to when arguing an advance was really a loan.
Book 15 minutes with Alex.
We will tell you straight up if we cannot help you.
Read this before you book.
- ✗We do not offer free trials.
- ✗We do not give discounts.
- ✗We do not do commission deals.
- ✓We require an upfront investment to work with us.
If you are not able to invest into getting more leads for your brokerage, do not book a call.
— Alex