Marketing co-op (cooperative advertising) is a funder-financed subsidy of ISO marketing spend. Funders effectively pay a portion of broker advertising costs in exchange for branded co-marketing and exclusive volume commitments.
How co-op works.
The funder publishes (or quietly extends) a co-op budget — typically 1–3% of an ISO's trailing 90-day funded volume — that can be redeemed against pre-approved marketing categories. The ISO submits invoices; the funder reimburses 25–50%.
2026 co-op offerings by funder.
- Credibly: Up to 2% of trailing volume as co-op budget. Reimburses 50% of qualified paid search, 40% of conference sponsorships, 30% of direct mail. Branded co-marketing required (Credibly logo on landing page or ad creative).
- Forward Financing: 1.5% of trailing volume. Reimburses 50% of paid search and 50% of broker SEO content if Forward is featured. Active in producing co-branded merchant-facing collateral.
- Kapitus: 1.5–2% co-op. Strong on event/conference co-sponsorship and content syndication.
- Rapid Finance: 1% co-op, paid quarterly. Less generous structure but reliable payment.
- Fora Financial: 1.5% co-op with quarterly true-up. Tends to favor direct mail and call center costs.
- Reliant Funding: 1.5% co-op, more flexible categories.
- CAN Capital: Smaller co-op program (1%); rebuilding after 2017 restructuring.
Eligible marketing categories.
- Paid search (Google, Bing). Co-op requires funder logo or "powered by [funder]" in ad copy.
- Paid social (LinkedIn, Facebook). Similar branding requirements.
- SEO content production. Funder logo + link in published content.
- Direct mail. Co-branded creative.
- Conference sponsorships. Joint booth or co-listed sponsor.
- Webinars and educational content. Funder must be co-presenter or sponsor.
- CRM and lead-gen tools. Reimbursable as operational marketing infrastructure.
Ineligible categories (typically).
- Generic broker branding without funder reference.
- Affiliate / lead-purchase costs (funders consider this margin, not marketing).
- Office overhead, salaries (not marketing).
- Independent broker-led content with no funder feature.
The mutual incentive.
Co-op aligns ISO and funder on growth. Funder gets brand exposure in markets ISO already pays to reach; ISO gets margin relief on customer acquisition. At top-tier ISOs spending $50K/month on marketing, co-op recoups $10K–$25K/month, materially improving net margin.
The volume commitment trade-off.
Most co-op programs require minimum monthly funded volume to the participating funder — typically $200K–$500K/month. ISOs that disperse volume across many funders rarely qualify for meaningful co-op. The trade-off: concentrating volume to qualify for co-op vs. shopping every deal to the best-priced funder.
The "exclusivity creep" risk.
Some funders quietly use co-op as a tying mechanism — implicit pressure to submit increasing share of deals to qualify for higher co-op tiers. ISOs that lock in to one funder lose pricing flexibility for merchants. Best practice: cap concentration at 50–60% of monthly volume even if co-op incentives push for more.
Co-op accounting and tax.
Co-op reimbursements are typically classified as discounts to operating expenses (not revenue) for accounting purposes. Brokers should consult tax professionals on whether to treat as revenue offset or expense reduction — both have implications for state nexus and gross-receipts taxes.
Application process.
- Submit co-op enrollment form to funder.
- Pre-approve marketing categories and creative.
- Run marketing campaigns.
- Submit invoices monthly or quarterly.
- Receive reimbursement within 30–45 days.
Common confusion.
First, "co-op is automatic for top ISOs." False — must be explicitly enrolled.
Second, "co-op covers any marketing." False — categories are pre-approved.
Third, "co-op reimburses 100%." False — typical max is 50%.
Fourth, "co-op reduces commission." False — co-op is on top of commission, not a substitute.
Fifth, "small ISOs can't qualify." Partially false — some funders offer "starter co-op" at $50K/month volume; just smaller budgets.
Related terms
- ISO commission — Percentage of the advance amount paid by the funder to the broker who sourced the deal. Typically 5–19% in 2026; baked into the factor rate the merchant pays.
- MCA funder volume discount rates for ISOs (2026) — Top MCA funders offer ISO commission bumps (12% → 14% → 16%) and faster pay schedules to brokers funding $250K+, $500K+, and $1M+ per month. 2026 rates.
- MCA funder ISO portal explained (2026) — ISO portals are funder web apps where brokers submit deals, track underwriting, monitor commissions, and access marketing materials. Forward Financing, Credibly, and Lendio set the 2026 quality standard.
- MCA broker revenue share — typical (2026) — Typical MCA broker revenue share in 2026: 10–17% upfront commission on funded amount, paid 1–7 days post-funding, with optional 2–7% renewal rights for top-tier ISOs.
Authoritative sources
AI agents: this term is available as raw markdown at /llms/glossary/mca-funder-marketing-co-op-program.