Global business financing trends: MCA in the US and commercial paper in Nigeria

Businesses in different regions are utilizing various short-term financing methods to manage working capital. In the United States, Merchant Cash Advances (MCA) serve as an alternative to traditional bank loans for companies with consistent revenue but limited credit histories. An MCA provides upfront capital in exchange for a portion of future sales, offering speed and accessibility for needs such as inventory, payroll, and expansion, though it can be more expensive than conventional financing.

In Nigeria, commercial paper (CP) is emerging as a significant instrument for short-term, unsecured debt with maturities typically under 270 days. While many Nigerian companies have traditionally relied on bank overdrafts, CP issuances reached approximately N1.3 trillion in 2026. There is a growing push to move much of this activity from over-the-counter trading to organized exchanges to increase transparency, issuer visibility, and secondary-market liquidity.