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Total repayment amount RTR
Also called RTR, right to receive, purchased amount, total payback, payback amount.
The full sum a funder is entitled to collect — funded amount multiplied by the factor rate — which is fixed at signing and does not shrink because the money is repaid quickly.
Drafted with AI assistance. Not yet independently checked. Nobody has verified the claims on this page against a source, so treat the figures and legal points as a starting point rather than as settled, and confirm anything you are about to act on. How we check things.
What it means
On an advance it is the purchased amount: the dollar figure of future receivables the funder bought. The contract obliges the merchant to deliver that amount out of receipts, not to repay principal plus accruing interest. On a pre-computed short-term loan the equivalent is the total of payments, similarly fixed at origination.
That fixedness is the single most important structural feature of these products. There is no interest clock. Repaying in four months instead of ten does not reduce the obligation unless the contract contains a prepayment discount, an early payoff schedule, or a rebate provision — and where such a clause exists, it is usually tiered and usually modest.
Fees can sit outside it. Origination and administrative fees are frequently deducted from the funded amount rather than added to the payback, which means the payback is calculated on a gross figure the merchant never received.
Where this one catches people
Merchants hear "pay it off early and save" and assume it works the way a mortgage does. It does not, and the reason is that the cost was never time-based. The related error runs the other way: some contracts do provide for a reduced payoff, so assuming there is none without asking leaves money on the table. Get the payoff figure in writing before deciding, because it is the only number that answers the question.
Worked through
Illustrative only. $75,000 funded at a factor of 1.40 gives an RTR of $105,000. Origination fee of 2 percent is deducted at funding, so $73,500 is wired. Paid over an estimated 9 months, the business delivers $105,000 against $73,500 received — $31,500 of cost. Paid off in month four with no discount clause, the business still delivers $105,000.
Figures in the example are illustrative. They show the arithmetic, not a quote — what any one lender would charge is on that lender's page, where it is published at all.
Where you will meet this term
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Total repayment amount — common questions
What does total repayment amount mean?
The full sum a funder is entitled to collect — funded amount multiplied by the factor rate — which is fixed at signing and does not shrink because the money is repaid quickly.
Where does total repayment amount catch people out?
Merchants hear "pay it off early and save" and assume it works the way a mortgage does. It does not, and the reason is that the cost was never time-based. The related error runs the other way: some contracts do provide for a reduced payoff, so assuming there is none without asking leaves money on the table. Get the payoff figure in writing before deciding, because it is the only number that answers the question.
Is total repayment amount the same as an interest rate?
Total repayment amount is defined above; if you are comparing it against a rate, check whether the two measures share a time dimension before you put them side by side.
Which products does total repayment amount apply to?
Merchant Cash Advance, Working Capital, Revenue-Based Financing.
Is there a worked example of total repayment amount?
Yes, on this page, and it is labelled illustrative. It shows the arithmetic, not a quote from any lender.
What else should I read alongside total repayment amount?
Early payoff discount, Factor rate, Net funding amount, Payoff letter, Specified percentage.
Has this definition been checked?
Not yet. This entry is drafted and live, and the notice at the top says so. Confirm anything you are about to act on.
Is this legal advice?
No. It is a definition. What a clause does in your contract, in your state, is a question for a lawyer licensed where you are.
Can I suggest a term?
Yes — [email protected]. The glossary grows from what people are actually shown in contracts.