Defaulting on a merchant cash advance can have serious consequences for your business. The first step the lender will take is to attempt to collect payment through collection agencies and legal action, if necessary. This can lead to negative marks on your credit report, making it more difficult to obtain traditional loans in the future. Additionally, the lender may use aggressive collection tactics, including late fees and other charges. These can add up quickly, making it even harder to pay off the loan. Look for lenders that are regulated by the FCA where possible. Finally, if all else fails, the lender may take legal action against your business by seizing any assets you have pledged as collateral. This could include property or equipment used in your business. For these reasons, it’s important to pay off your merchant cash advance on time and as agreed. If you are having trouble making repayments, contact the lender immediately to discuss your options. This can help you avoid defaulting and save your business from potential financial hardship.