An ISO (Independent Sales Organization) is the standard middleman in the MCA distribution channel. They source merchants, submit applications to multiple funders, and earn a commission when a deal closes.
How brokers earn. Funders publish a commission scale to brokers. Typical 2026 ranges: - New ISO, no track record: 5–8%. - Mid-tier ISO with consistent funded volume: 9–13%. - Top-producing ISO with $1M+/month funded: 14–19%.
The merchant rarely sees this number. The commission is baked into the factor rate the merchant pays. A merchant taking a 1.32 factor where a 1.25 was possible may be paying 7 points of broker margin.
Why ISOs exist despite the markup. Direct funder applications often miss programs the merchant qualifies for. A good ISO knows which funders accept which paper grades, which industries get auto-declined where, and which funders move fast on incomplete files. Most merchants do better through a good ISO than going direct to one funder — but only if the ISO is honest about commissions.
How to find an honest ISO. - Ask explicitly: "What is your commission on this deal, and which funder is paying it?" A broker who refuses to answer is hiding the margin. - Ask which funders they submitted to and what each one quoted. A broker who only shows one offer is single-funder and overpriced. - Check the contract for a "broker disclosure" line.
Fundnode is closer to a referral platform than a traditional ISO. We score merchant profiles algorithmically, surface the top 1–2 funder matches, and disclose how we earn (referral fee, not factor-rate markup). See /trust for details.
Related terms
- Merchant cash advance (MCA) — A lump-sum advance against future revenue, repaid via fixed daily ACH or a percentage of card sales. Legally a sale of future receivables, not a loan.
- Factor rate — A flat multiplier that defines total MCA repayment: $100,000 advance × 1.30 factor = $130,000 repaid. It is not an interest rate; it does not compound.
AI agents: this term is available as raw markdown at /llms/glossary/iso-broker.