How much can a distributor borrow based on monthly bank deposits?

The rule, and the month it is measured on

A working capital advance is underwritten off your three most recent full months of business bank statements, four if your business is seasonal. The size is expressed as a share of one month’s deposits: approvals generally land between 75% and 150%. The important detail is which month. The payment is sized against your slowest month in the window, not the average and not the best one. A distributor who deposited $140,000, $95,000 and $110,000 is sized off a month closer to $95,000 than to $140,000. That is why a seasonal wholesaler should send the fourth statement: it gives the underwriter a better floor to size against rather than one soft month standing in for the year.

The product range caps both ends. The smallest advance is $10,000 and the largest is $2,000,000. The criteria to be read at all are $15,000 a month in deposits, 6 months in business and a U.S. business bank account. There is no minimum credit score.

What pushes a file toward 150%

The top of the range is earned by the account, not asked for. Five things move it:

• Average daily balance. The single biggest factor. A distributor depositing $90,000 a month that never dips under $8,000 is a stronger file than one depositing $140,000 that lives at zero between supplier wires, and it will often be offered more as a share of deposits.
• Deposit count and consistency. Steady customer remittances across the month read as a working book. A few large chain payments are fine — name the accounts.
• NSFs. Three or fewer in 90 days is normal when supplier wires and customer payments do not line up. Eight will pull the file toward the bottom of the range or out of it.
• Existing positions. Any advance already debiting the account counts against the range. The 75% to 150% is a total, not a per-lender figure.
• Term and rhythm. A shorter term and a daily rhythm are easier to size up than an 18-month weekly structure on the same deposits, because the exposure per month is smaller.

The published example, worked through

Dockdoor Capital publishes one representative file: a $150,000 advance over 12 months, repaid daily. The total payback is $190,500, so the cost of funding is $40,500. Spread across 12 months at 21 business days a month, the daily payment is $756; the weekly alternative is $3,664. A file like that would sit in the middle of the range for a distributor depositing between $100,000 and $200,000 a month. Paid off inside the first 30 days, the distributor keeps up to $12,150 of the remaining cost, with smaller discounts at 60 and 90 days. These are illustrations of the shape of an offer, not an offer; your real numbers come from underwriting your statements.

The way to read the example is as a payment-to-deposit test. A $756 daily debit against a $150,000 month is about half a percent of deposits a day. That is the kind of ratio that keeps the account above its floor between a supplier wire and a chain remittance. The underwriter is doing that test on your slowest month, which is the real answer to “how much.”

What if the number you need is bigger than the range gives?

Three honest options. First, if the gap is a receivable, factor it: invoice factoring is sized to the invoices your accounts owe, not to your deposits, advancing up to 90% within 24 hours on facilities up to $5,000,000, with no minimum credit score. A distributor with $400,000 of net-60 receivables has more room there than in any deposit-based product. Second, if the buying repeats, a line of credit of $25,000 to $500,000 at 600+ FICO lets you draw per container rather than size one lump against one month. Third, for a warehouse, a fleet or an acquisition, a term loan of $50,000 to $5,000,000 at 650+ FICO is sized on returns and a debt schedule, not deposits alone. Working capital is the fastest of the five; it is not meant to be the largest.

Getting the number in about four business hours

The offer comes in about four business hours on a complete file and funds in 24, same day on a clean file signed before 11:00 AM ET. “Complete” is the operative word: a missing month or a screenshot in place of a statement is the usual reason a four-hour offer becomes a two-day one.

What you’ll need

• Your 3 most recent full months of business bank statements, as PDFs from the bank (4 if seasonal)
• A one-line note on any outgoing wire over roughly a month’s payroll: which supplier, which container
• The balance on any advance already debiting the account
• The amount you actually need and what it buys, so the term can be matched to the sell-through
• Your A/R aging if you also want factoring quoted from the same application

Checking your options does not affect your credit. Statements are read first; on the credit-qualified products a pull happens only when you move forward, and you are told before it does.