A guide for MCA funders

Pre-migration: what to clean up first

The quality of your migration is determined entirely by the quality of the data and process you bring into it.

The biggest mistake MCA shops make during migration is importing dirty data into a clean system. A unified lending platform calculates payoffs, generates syndicator statements, and calculates commission payouts based on whatever you put in it. If your merchant name has three different spellings across deals, your balances haven't been reconciled, and your deal statuses mean different things to different reps — all of that comes with you.

And because your new platform will run automated calculations on that data, a wrong balance won't sit quietly in a cell. It will show up in the payoff letter you send the merchant, the statement you send the syndicator, and the commission payout you send the ISO.

Do this work before your platform vendor is involved.

Pre-migration data cleanup checklist

Work through this before your first import. Flag anything you can't resolve immediately — those are your migration blockers.

• Merchant legal names are standardized across all records, with consistent punctuation and entity designation.
• DBA names are separated from legal names and documented for each merchant.
• Active deal balances have been reconciled against your ACH processor within the last 30 days.
• Duplicate merchant records have been identified and merged into a single record.
• Each active deal has a confirmed payment amount, frequency, and start date.
• All ACH authorization records are attached to the correct merchant and deal.
• Syndicator participation percentages have been verified against the last investor statement.
• Commission structures for active ISOs are documented and confirmed.
• Deals in collections are flagged with current status and last contact date.
• Deals in legal or default are separated, flagged, and set aside for manual handling.
• Any manually modified payment plans (holdback adjustments, temporary reductions) are documented.
• Bank statement records are filed and linked to the correct deal, not floating in a shared drive.

Pre-migration process documentation checklist

Before you move your operations to a platform, you need to know what your actual process looks like. The real one, not the version you wish were true.

• Deal statuses are defined as a fixed list that every rep uses, with no freeform variations.
• Decline reasons are standardized as a defined list, not freeform text entered by each underwriter.
• Approval authority levels are defined, including who can approve up to what amount.
• Exception approval process is documented, including who signs off and how each exception is logged.
• Collections escalation stages are defined from first missed payment through legal handoff, with timeframes for each stage.
• Renewal eligibility criteria are written down and accessible to the full team, not held by a single underwriter.
• Commission logic is documented in full, including split rates, clawback conditions, and payout timing.
• Syndicator payout schedule and waterfall logic is documented.

On data cleaning timelines

Plan two to three weeks for data cleanup if your portfolio is active and your spreadsheets have been built by more than one person over time. Every discrepancy you find requires the right person in the room to confirm which number is correct. If your operation is under 50 active deals and one person owns all the data, you can move faster. Either way, the cleanup is what makes the rest of the migration clean.