A slow month can reduce the amount your financing provider takes from each day’s sales. It does not necessarily reduce the payment you must make by a deadline.
If your agreement includes a minimum payment, you may have to cover the difference when sales deductions fall short. A final repayment deadline or recurring fee can also continue to apply.
The answer depends on your financing agreement. To understand what you still owe, separate three amounts: what gets deducted today, what is due at the next payment checkpoint, and what remains outstanding overall.
This guide covers U.S. business financing. Provider information was checked on September 6, 2026. Your signed agreement determines your specific obligations.
What is revenue-based financing?
Revenue-based financing is a funding arrangement in which a business receives money upfront and makes payments linked to its revenue. Instead of paying only a fixed monthly installment, the business pays an agreed percentage of qualifying sales toward the amount specified in its financing agreement.
For example, if the agreed percentage is 10%, $20,000 in qualifying sales would generate a $2,000 payment. If sales fall to $8,000, the sales-based payment would fall to $800—before accounting for any separate minimum-payment requirement.
The percentage generally applies to revenue or specified receipts, not profit. Your business may still make a financing payment in a month when rent, payroll, inventory, and other expenses leave it with a loss. The agreement defines which sales count.
Businesses may find this structure appealing because collections can rise and fall with trading activity. But that flexibility has limits. The term “revenue-based financing” is used for different arrangements, including loans collected through sales deductions and purchases of future receivables. Their minimum payments, fees, and deadlines can differ. Stripe’s explanation of financing types
That is why a slow month raises two separate questions: How much will be deducted from sales, and is anything else still due?
Identify what kind of financing you have
Two offers that both collect a percentage of sales can behave differently when business slows. Start with the agreement’s description of the transaction, then read the payment provisions.
| Financing structure | How collections work | What to check during a slowdown |
|---|---|---|
| Loan repaid through a percentage of sales | The provider collects a share of eligible sales toward a loan balance. | Minimum payments and a final repayment deadline may still apply. |
| Purchase of future receivables, often called a merchant cash advance | The provider purchases future receipts and collects according to the agreement. | How collections follow actual receipts, and what other contractual obligations apply. |
| Sales-based arrangement using estimated withdrawals | The provider takes an estimated amount, with a mechanism for adjusting it to actual sales. | Whether you must request an adjustment and provide supporting records. |
Stripe’s U.S. documentation describes loans with periodic minimum payments and a separate YouLend merchant cash advance that purchases future receivables without a fixed payment schedule or periodic debits. Those products should not be treated as having identical repayment obligations. Stripe Capital documentation
New York’s statutory definition of sales-based financing also recognizes arrangements that use a reconciliation process to adjust payments to sales. An estimated withdrawal therefore may need adjustment before it reflects a slowdown. New York Financial Services Law §801
A slow-month example: sales fall, but a minimum still applies
Suppose a business accepts the following hypothetical loan:
- Amount received: $20,000
- Fixed financing fee: $3,000
- Initial total repayment obligation: $23,000
- Automatic collection: 10% of eligible sales
- Minimum payment: $1,500 per month
Assume sufficient balance remains outstanding, deductions count toward the minimum, and there are no additional charges.
| Eligible sales during the month | Automatic collection at 10% | Additional payment needed | Total paid for the month |
|---|---|---|---|
| $30,000 | $3,000 | $0 | $3,000 |
| $15,000 | $1,500 | $0 | $1,500 |
| $6,000 | $600 | $900 | $1,500 |
| $0 | $0 | $1,500 | $1,500 |
At $6,000 in sales, the automatic deduction drops to $600. But the business must still find another $900 to satisfy the monthly minimum.
Compared with the $30,000 month, sales have fallen 80%, while the required payment has fallen only 50%.
That is the limit of the flexibility in this example: collections move with sales until the minimum becomes relevant.
The $0-sales row also answers a common question. Zero sales can mean zero sales-based deductions while a separate loan payment remains due. Do not apply that conclusion automatically to a receivables-purchase agreement with different terms.
Calculate the amount due at your next checkpoint
For an agreement with a minimum payment, use:
Shortfall = required minimum − payments credited toward that minimum
If the result is negative, there is no shortfall.
Suppose your next checkpoint requires $2,400 and you expect $1,650 in credited payments by that date:
$2,400 − $1,650 = $750 additional payment needed
The measurement period matters. Your agreement might use a month, 60 days, or a cumulative milestone. Do not divide a 60-day minimum into two assumed monthly obligations.
Also verify how earlier payments count. Do payments above one period’s minimum reduce a later period’s requirement, or only the overall balance? The answer affects how much cash you need to keep available.
Stripe’s U.S. loan documentation says it automatically debits a minimum-payment shortfall from the linked bank account or account balance. A smaller daily deduction therefore does not necessarily prevent an additional withdrawal at the period’s end. Stripe payment requirements
A minimum payment is not necessarily a cap
A minimum tells you the least you must pay over a specified period. It does not necessarily tell you when sales deductions stop.
Square, for example, says its percentage-based collections continue after the minimum is met. Its guidance also states that the outstanding balance becomes due at maturity, and that missing a minimum or maturity payment may lead to an additional debit or an increased repayment rate. Square loan repayment guidance
This creates two separate planning questions:
- In a weak period, can you cover the minimum?
- In a strong period, how much cash will percentage-based collections remove?
Use the expected sales deduction in your busy-month forecast, rather than budgeting only for the minimum.
Does a slow month make financing more expensive?
Check how your fee is calculated.
With a fixed-fee structure, taking longer to repay may leave the agreed financing fee unchanged. With a monthly-fee structure, a longer repayment period can mean paying more monthly fees.
Shopify’s U.S. documentation describes both structures. It also describes minimum-payment checkpoints and a maximum loan term of 18 months. These features show why a sales-linked collection method does not, by itself, establish either the total cost or the repayment deadline. Shopify Capital repayment guidance
For illustration, suppose a hypothetical plan charges $200 for each month the balance remains active. Six chargeable months would produce $1,200 in fees; ten would produce $2,000. The actual agreement determines when fees accrue and stop.
Also distinguish a financing fee from an annual percentage rate. A factor of 1.15 on $20,000 produces a $23,000 repayment amount, but that calculation alone does not establish an APR.
New York’s applicable sales-based financing disclosures separately address finance charges, estimated APR, repayment amounts, and other potential fees. That separation is useful when comparing offers. New York Financial Services Law §803
Check what the provider counts as “sales”
The repayment percentage may apply to a different number from the revenue or cash available in your own budget.
Shopify, for example, says its repayment calculation includes shipping charges, applicable taxes, and orders later refunded or canceled. A business should therefore check the contractual calculation rather than simply applying the percentage to net sales after refunds. Shopify’s sales calculation
Refunds deserve particular attention. Stripe’s Capital-for-platforms documentation says customer refunds do not automatically reverse financing paydowns. It describes a manual reversal request that is evaluated case by case. That finding applies to the documented platform workflow; other arrangements may differ. Stripe reporting and reversal guidance
Even when a deduction decreases your financing balance, it still removes cash that you might need for a refund, payroll, or rent.
What if the withdrawal stays the same when sales fall?
Some arrangements collect an estimated amount instead of calculating each withdrawal directly from current receipts.
Look for a provision called reconciliation, adjustment, or true-up. Read how the amount is recalculated, whether you must request the change, and what evidence is required.
Before relying on an adjustment, establish:
- Which sales period the provider will review.
- What documents you must submit.
- Whether a request deadline applies.
- When an approved change takes effect.
- Whether the process addresses past excess collections, future withdrawals, or both.
Bank statements, processor reports, and a record of financing deductions can help you prepare. The agreement and provider determine the required submission.
A reconciliation request and a request for temporary payment assistance are different. The first asks for collections to reflect the agreement’s sales formula. The second asks the provider to agree to different payment terms. Neither should be treated as approved merely because you have submitted a request.
Eight details to find in your agreement
Before your next payment date, write down these details in one place.
| Detail | Question to answer |
|---|---|
| Financing type | Is this a loan or a purchase of receivables? |
| Eligible sales | Which receipts, channels, taxes, tips, and refunded transactions count? |
| Collection method | Is the deduction based on actual sales or an estimate? |
| Minimum requirement | What amount must be paid, over which period? |
| Payment credits | How do manual payments and earlier excess payments count? |
| Final deadline | When does any remaining balance become due? |
| Fee structure | Is the fee fixed, recurring, or calculated another way? |
| Adjustment and shortfall process | How can payments change, and what happens if collections are insufficient? |
Keep the agreement alongside your payment history. A dashboard can show what has been collected, but you also need to understand what becomes due next.
What to do before a slow month creates a shortfall
1. Forecast through the next contractual deadline.
Use the agreement’s actual eligible-sales definition and payment period. Include a weaker-sales scenario.
2. Calculate the extra cash required.
Subtract payments already credited and expected eligible deductions from the required minimum. Keep that shortfall separate from the overall outstanding balance.
3. Review the rest of your cash commitments.
Allow for operating costs, refunds, taxes, and other financing payments. A payment can be manageable as a percentage of sales but difficult alongside those obligations.
4. Contact the provider before the due date.
Explain the expected sales decline, the projected deductions, and the likely shortfall. Ask about an applicable reconciliation process or available repayment assistance. Square specifically advises borrowers needing assistance to contact it before payment is due. Square repayment assistance
5. Get an approved change in writing.
Confirm the revised amount, effective date, treatment of any existing shortfall, and whether fees or the final deadline change. Until a change is agreed, budget using the existing terms.
What do you still owe?
In a slow month, check three numbers:
- Today’s deduction: what the sales formula collects.
- The next amount due: any additional payment needed at a contractual checkpoint.
- The remaining balance: what is still outstanding under the agreement.
Revenue-linked collections can provide breathing room. How much room they provide depends on the minimums, deadlines, fee structure, and adjustment provisions attached to them.
Before assuming a smaller deduction means a smaller obligation, calculate what is due at the next checkpoint—and where that cash will come from.