ISO Program for MCA Brokers: What to Do With Deals You Can’t Place

Why Good Files Die in the Drawer

A decline from your lenders is a statement about their box, not always about the merchant. The common reasons:

• Too many positions. The merchant has three or more open advances and your lenders stop at two.
• Revenue under the floor. Monthly deposits are steady but sit below the minimum your lenders set.
• A rough recent month. One slow month or a few returned items put the file outside the guidelines you work with.
• Restricted industry. Your lenders exclude the industry outright.
• The deal is too large. The merchant wants $500,000 or more and your lenders cap lower.
• The wrong product. The merchant really needs a term loan, an SBA loan, equipment financing or a line of credit, and you only place advances.

Partial and failed applications are normal across small business financing. In the Federal Reserve Banks’ 2024 Small Business Credit Survey, fewer than half of the employer firms that applied for financing received all of the amount they sought, and about one in four received none. Firms that were turned down were also more likely than in 2021 to say the reason was too much existing debt.

Each of those reasons is a prompt to try a different network.

The Math on Files You Already Paid For

Your cost to acquire a merchant is spent whether the file funds or not. The lead cost, the opener’s time, the closer’s time and the processing are all behind you. The only open question is whether that spend earns anything.

A split commission on a file that would otherwise earn nothing is found revenue. It is smaller than a deal you place yourself, because the second broker does the placement work.

There is a second return that does not show up in this month’s numbers. The merchant gets an answer instead of silence. That protects your name the next time they need capital.

This is not income you can forecast. Not every application is approved.

How a Second-Look Partnership Works, Step by Step

RAN Funding is a broker, not a lender. The file goes from your shop to ours, then to the lenders in our network whose guidelines it fits.

1. Sign up and sign the agreement. Fill in the form on the partner page and select ISO / Funding Broker. One of us calls within one business day to walk through the partner agreement. Non-circumvention and the commission split are signed before you send a file.
2. Send the file. The application and bank statements you already collected. Note what you tried and why it was declined.
3. Get an answer within one business day. Every submission gets one of three answers: placed, needs more, or declined and why.
4. Choose the handoff. Stay on the deal and co-manage it, or hand it off and let one dedicated specialist run it.
5. The deal funds and you are paid the split in the agreement. Renewals on your merchants pay you as well.

There are no quotas, no minimums and no exclusivity. You keep placing everything that fits your own lenders. The partnership covers what does not.

Which Files Fit and Which Do Not

A second look works when the merchant is sound and the first network was the problem. The best-fit files usually have:

• 1+ year in business. Established businesses only.
• $20,000+ in average monthly revenue.
• A business bank account with active revenue and deposits.
• The 3 most recent business bank statements (4 in NY, CA or VA), complete. What lenders look for in bank statements explains why every page matters.
• A need of $10,000 to $500,000+ in working capital, up to $2 million on some products and up to $5 million for SBA.
• A clear use for the money: payroll, inventory, equipment, a tax payment, a large contract or paying off higher-cost debt.

Any industry is open, across the U.S. And some files are not worth sending:

• Startups. A business with less than a year of history is not a fit.
• Personal needs. This is business financing only.
• No business bank account. Personal statements do not count.
• Files with something hidden. Undisclosed positions or altered statements end the review and the relationship.
• Merchants who did not agree to be shared. Ask first, every time.

Meeting the list is not a guarantee of an offer.

What RAN Funding Can Place

It is one application for our lender network and one dedicated specialist. The network covers more than advances.

For a merchant with open advances, see business funding with an existing MCA and merchant cash advance consolidation.

Not every file can be placed, and nothing here is a guarantee of approval. What you can count on is a real answer on every submission.

What Happens After You Send the File

One dedicated specialist reviews the file and calls you back within one business day. If something is missing, you hear exactly what. If the file is declined, you hear why, so you can tell the merchant something true.

If the file can be placed, the specialist submits it and walks through each offer. You choose how involved you stay.

Either way, RAN Funding contacts the merchant only about the funding they asked for. No cross-selling, no marketing lists.

How and When You Are Paid

RAN Funding is paid a commission by the lender when a deal funds. Your share comes out of that commission. This page does not quote a number. The split depends on the partner type and on whether you send an introduction or a complete file.

• It is set in writing. The split is in the partner agreement before you send anything.
• It is paid at funding. When the lender funds and RAN Funding receives its commission, your share is paid on the schedule in the agreement, typically by ACH. It does not wait on a net-30 cycle.
• Renewals pay. When your merchant takes more funding later, you are paid on that as well.
• Nothing funds, nothing is paid. A declined file earns neither of us anything.

Structures differ across the industry: a share of the placing broker’s commission, a flat amount, or tiers by volume. How business loan referral fees work covers the questions to ask about each.

What to Get in Writing First

Before the first submission, the agreement should cover:

• Non-circumvention. The other broker will not go around you to your merchant, now or at renewal.
• Merchant tagging. Your merchants are marked as yours in the other broker’s CRM.
• The split, and whether it differs between an introduction and a complete file.
• The payout schedule and any clawback terms if a deal defaults early.
• Renewal rights. Whether you are paid when the merchant takes more funding later.
• Who talks to the merchant. You, them, or both on the call.
• How merchant data is handled. Who can see the statements and what they may be used for.

If a broker will not put non-circumvention, tagging and renewals on paper, keep the file.

Compliance and Ethics When You Share a File

Sharing a file with another broker does not remove your own obligations to the merchant. Three areas deserve attention.

State broker rules. Florida’s commercial financing law lists acts a broker may not do. A broker may not collect or solicit an advance fee from a business for its services as a broker. A broker may not make false or misleading representations, or leave out a material fact, when offering its services. And a broker may not advertise its services without disclosing its actual address and telephone number.

Disclosures. California requires a provider that extends a specific commercial financing offer to give the recipient disclosures at the time of the offer, and the recipient must sign them before the deal is finalized. They include the total funds provided, the total dollar cost of the financing, the term, how and how often payments are made, and prepayment policies.

Those are two states. Check the registration and disclosure requirements in every state where your merchants operate. MCA disclosure laws by state is a starting point, not legal advice.

Consent and honesty. Tell the merchant their file is going to a second broker, and get their agreement before you send it. Do not describe yourself as a lender. Do not promise an approval. RAN Funding’s partner page says no license is needed for a basic referral introduction, but an ISO that collects applications and discusses offers does more than introduce. Confirm the rules that apply to you.

Three Illustrative Scenarios

These are examples, not descriptions of specific merchants.

• The stacked restaurant. Picture a restaurant in Tampa with three open advances and steady card sales. Your lenders stop at two positions. You send the file with a note on the balances. The specialist weighs consolidating the positions against adding a fourth, and you stay on the calls because the owner trusts you.
• The wrong product. A machine shop in Cleveland asks you for an advance to buy a CNC machine. The request is larger than its deposits support. You hand the file off. The specialist takes it to equipment lenders, where the machine itself is the collateral.
• The file that still does not fit. A catering company in Phoenix has been open eight months. It is declined, and you hear why the same day: under one year in business. You tell the owner when to come back. No one is paid, and no one was misled.

The first two files had a chance only because they left the drawer. The third cost you one email.

Common Mistakes ISOs Make with Second Looks

• Sending the file before the agreement. Non-circumvention signed afterwards protects much less.
• Sending the same file to several shops at once. The merchant gets a flood of calls.
• Hiding why the file was declined. The decline history saves a day.
• Leaving out positions. Existing balances show on the statements anyway.
• Not telling the merchant. A call from a company they have never heard of ends the deal.
• Promising the merchant an outcome. A second look is a second review. It is not an approval.

How to Start

Go to the RAN Funding partner program page and fill in the short form. Select ISO / Funding Broker, and say so if you have a file that needs attention now.

We call within one business day to walk through the partner agreement. Read the non-circumvention and split terms before you sign. Then send two or three drawer files that meet the criteria above, with a decline note on each.

The same program has a simpler track for professionals who only introduce clients. See the difference between an affiliate program and a referral program and the guide for payment processing reps. You can also call 1-877-522-6045, Monday to Friday, 9am to 6pm ET.

Common Questions