Shopify Capital Transitions From MCAs to Loans in Canada

Shopify is officially shifting its merchant funding model in Canada from Merchant Cash Advances (MCAs) to traditional loans. This change is a direct response to 2025 regulatory shifts in the Canadian market. If you are a retailer using Shopify Capital to fund inventory or growth, the way you interact with this capital is changing on the back end. Loans are generally subject to more rigorous disclosure requirements than MCAs. This means you will likely see clearer terms regarding interest rates and repayment schedules rather than the 'factor rates' common in cash advances. From an accounting perspective, Shopify is now categorizing these funds under different financial standards. For your business, this transition could simplify how you track debt on your balance sheet. The move signals a broader trend where tech platforms are becoming more like traditional banks to stay compliant with local laws. This shift ensures that Canadian merchants can still access quick capital through the Shopify dashboard, even as the legal landscape for alternative lending tightens. Expect more transparent cost structures but potentially more formal credit reporting requirements moving forward.

Source: deBanked

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