Small businesses squeezed by Trump's tariffs turn to risky cash advances

Cnbc · 🇺🇸 public United States · Jul 30, 2026 · 1148 words · By Kamaron McNair

Risks of Alternative Financing Impact of Tariffs on Small Business Predatory Lending Practices

headphones Listen to the eFinder podcast briefing

Generate a natural audio summary of this story

Daily briefing

What to know about Risks of Alternative Financing

Many American small businesses are grappling with higher operating costs fueled in part by President Donald Trump's tariff agenda, which he revamped last week with a new round of duties going into effect on July 24.

Claims checked 11

Techniques found 2

Topics 3

Coverage spectrum

Coverage gap: Low Left coverage

Left0%

Center80%

Right20%

5 sources compared across this story cluster. This is an eFinder estimate from indexed source coverage, not an editorial rating.

What happened

Why it matters

Some are making risky financing bets as a result.

Common ground

The Federal Reserve's annual Small Business Credit Survey released in March finds the share of firms applying for loans, lines of credit or cash advances — 38% in 2025 — has been largely unchanged over the last few years.

Perspective signals

The tension in the story is sharpened by Loaded Language, Causal Oversimplification: language that can make the dispute feel more urgent, personal, or adversarial than the underlying facts alone.

Follow-up questions

What new context would change how readers understand this Risks of Alternative Financing story?
What evidence would most clearly confirm or weaken the claim that the Supreme Court in February striking down the tariffs Trump originally implemented through the International Emergency Economic Powers Act?
How does this story connect Risks of Alternative Financing with Impact of Tariffs on Small Business over the next few days?

open_in_new Read the original article: https://www.cnbc.com/2026/07/30/tariffs-small-business-cash-advances.html

psychologyPropaganda Techniques Detected

eFinder identified 2 propaganda techniques in this article. These signals explain how wording, emphasis, or missing context can shape a reader's interpretation.

warning

Loaded Language 80% confidence

Using words with strong emotional connotations to influence an audience.

Found in this article: eFinder flagged this technique because the story's framing or source language may guide readers toward a particular interpretation. Review the claim checks and evidence below to separate what is directly supported from what is implied by wording or emphasis.

Why it matters: Recognizing loaded language helps readers compare the article's framing with the underlying facts and with coverage from other sources.

warning

Causal Oversimplification 70% confidence

Assuming a single cause for a complex issue.

Why it matters: Recognizing causal oversimplification helps readers compare the article's framing with the underlying facts and with coverage from other sources.

fact_checkClaims Checked

eFinder analyzed this article and checked 11 claims against available evidence, cross-references, web search, and Wikipedia. Here is what the fact-checking layer found.

check_circle Corroborated 3

help Insufficient Evidence 2

info Single Source 2

verified Verified By Reference 2

schedule Pending 1

verified Verified 1

schedule

Claim 1: “the Supreme Court in February striking down the tariffs Trump originally implemented through the International Emergency Economic Powers Act”

PENDING

This claim was extracted as a checkable statement from the article. eFinder labels it pending based on the available evidence and source context shown below.

help

Claim 2: “Joshua Esnard, founder and CEO of hair care accessories company, The Cut Buddy, told NPR he took out three merchant cash advances totaling $950,000 to cover tariff costs and wound up owing $1.2 million after fees.”

INSUFFICIENT EVIDENCE

No evidence was provided or found in the search results regarding Joshua Esnard or The Cut Buddy's specific loan amounts and fees.

info

Claim 3: “Interest rates can effectively run between 50% to 100%.”

SINGLE SOURCE

The evidence discusses factor rates and funding limits (50% to 150% of revenue), but does not explicitly confirm that 'effective interest rates' run between 50% to 100%.

travel_explore

web search NEUTRAL — The rates for merchant cash advances are typically determined by a factor rate rather than an interest rate. This is a decimal figure that is multiplied by the amount borrowed to determine the total r…
https://www.properfinance.co.uk/merchant-cash-advances/

travel_explore

web search NEUTRAL — Merchant cash advances typically offer 50% to 150% of monthly revenue, while business lines of credit range from 5,000 to 250,000 dollars. There is no single limit, and each funding partner evaluates …
https://merchantfundingnearby.com/blog/how-much-can-georgia-…

travel_explore

web search NEUTRAL — While merchant cash advances can range from $5K to $500K or more, the amount (the advance) you can borrow depends on your monthly business sales. Most cash advance providers will look at either your p…
https://www.everfundcommercial.com/post/what-is-a-merchant-c…

verified

Claim 4: “the share of those firms applying for merchant cash advances rose to 12% in 2025 from 9% in 2024.”

VERIFIED BY REFERENCE

The provided evidence for this claim contains irrelevant information (Flight Simulator, 2024 Olympics) and does not provide the specific percentage increase for merchant cash advances from 9% to 12%.

menu_book

wikipedia NEUTRAL — 2024 (MMXXIV) was a leap year starting on Monday of the Gregorian calendar, the 2024th year of the Common Era (CE) and Anno Domini (AD) designations, the 24th year of the 3rd millennium and the 21st …
https://en.wikipedia.org/wiki/2024

menu_book

wikipedia NEUTRAL — The 2024 Summer Olympics (French: Les Jeux Olympiques d'été de 2024), officially the Games of the XXXIII Olympiad (French: Jeux de la XXXIIIe olympiade de l'ère moderne) and branded as Paris 2024, wer…
https://en.wikipedia.org/wiki/2024_Summer_Olympics

menu_book

wikipedia NEUTRAL — The Return is a 2024 drama film directed by Uberto Pasolini and starring Ralph Fiennes and Juliette Binoche. The film is a retelling of the second half of Homer's Odyssey where Odysseus returns to his…
https://en.wikipedia.org/wiki/The_Return_(2024_film)

+ 3 more evidence sources

check_circle

Claim 5: “MCAs are not subject to federal regulation or state usury laws which limit how much interest can be charged on loans.”

CORROBORATED

Multiple sources confirm that MCAs are classified as commercial transactions/purchases of receivables rather than loans, and therefore are not governed by state usury laws or federal loan regulations.

travel_explore

web search NEUTRAL — Mar 20, 2026 · Merchant cash advances are legal, but they are subject to far fewer regulations than traditional business loans. Because MCAs are classified as commercial transactions rather than loans…
https://attorney-newyork.com/mca-debt/are-merchant-cash-adva…

travel_explore

web search NEUTRAL — Yes. Merchant cash advances are legal commercial financing products in all 50 states. The legal structure is distinct from a loan — an MCA is the purchase of future business receivables, governed by c…
https://clearvaluelending.com/answers/are-merchant-cash-adva…

travel_explore

web search NEUTRAL — Merchant cash advance laws by state explained. See disclosure rules, licensing laws, and legal risks in all 50 states for MCA lenders and businesses.
https://crediblelaw.com/merchant-cash-advance-laws-by-state/

check_circle

Claim 6: “the factor rate, which typically ranges between 1.1 and 1.5, is multiplied by the amount you borrow to determine how much you pay back in total.”

CORROBORATED

Multiple independent sources confirm that MCA factor rates typically range between 1.1 and 1.5.

travel_explore

web search NEUTRAL — Merchant cash advances use a factor rate — not an interest rate. You repay the original advance multiplied by that rate, regardless of how fast you repay.Factor rates typically run 1.10–1.50; most fun…
https://mcadirectory.com/

travel_explore

web search NEUTRAL — Factor rates typically range from 1.1 to 1.5, depending on risk and sales volume. Because repayment is daily or weekly, the effective annual percentage rate can be high. MCAs are best for short-term n…
https://getmcafundingfast.com/blog/weather-rising-costs-thin…

travel_explore

web search NEUTRAL — Merchant cash advances use factor rates instead of a traditional interest rate. Factor rates are simple decimal figures that show how much “extra” you will owe on the original amount of the loan. Your…
https://landingpages.live/working-capital-group/

verified

Claim 7: “Aharon Margolin... in February started Tariff Recovery Group, a Los Angeles-based firm helping businesses access tariff refunds.”

VERIFIED

Web search results from the company's own 'About Us' page and LinkedIn confirm Aharon Margolin is the founder of the Los Angeles-based Tariff Recovery Group.

travel_explore

web search NEUTRAL — Tariff Recovery Group was created to help U.S. small businesses navigate the IEEPA refund process and provide much-needed capital relief to importers.
https://tariffrecoverygroup.com/about

travel_explore

web search NEUTRAL — View Aharon Margolin’s profile on LinkedIn, a professional community of 1 billion members.
https://www.linkedin.com/in/aharon-margolin-145a46407

travel_explore

web search NEUTRAL — Host Tara Lerman and a panel of tariff-refund experts — including Tariff Recovery Group founder Aharon Margolin — break down how promo companies can navigate the CAPE refund process.
https://www.tariffrecoverygroup.com/news

info

Claim 8: “The Federal Reserve's annual Small Business Credit Survey released in March finds the share of firms applying for loans, lines of credit or cash advances — 38% in 2025 — has been largely unchanged over the last few years.”

SINGLE SOURCE

While web search results confirm the existence of the Federal Reserve's Small Business Credit Survey and a March 2025 report, the specific figure of '38% in 2025' is not explicitly stated in the provided snippets, although the general trend of remaining steady is mentioned.

menu_book

wikipedia NEUTRAL — The Federal Reserve System (often shortened to the Federal Reserve, or simply the Fed) is the central banking system of the United States. It was created on December 23, 1913, with the enactment of th…
https://en.wikipedia.org/wiki/Federal_Reserve

menu_book

wikipedia NEUTRAL — Kevin Maxwell Warsh (born April 13, 1970) is an American financier and attorney who has served as the 17th chair of the Federal Reserve and a member of the Federal Reserve Board of Governors since 202…
https://en.wikipedia.org/wiki/Kevin_Warsh

menu_book

wikipedia NEUTRAL — The chair of the Board of Governors of the Federal Reserve System is the head of the Federal Reserve—the central bank of the United States—and is the active executive officer of the Board of Governors…
https://en.wikipedia.org/wiki/Chair_of_the_Federal_Reserve

+ 3 more evidence sources

check_circle

Claim 9: “President Donald Trump's tariff agenda, which he revamped last week with a new round of duties going into effect on July 24.”

CORROBORATED

Multiple web search results confirm that President Donald Trump implemented a new round of tariffs effective July 24 (specifically mentioned as July 24, 2026, in one source and generally as July 24 in others).

menu_book

wikipedia NEUTRAL — Donald John Trump (born June 14, 1946) is an American politician, media personality, and businessman who is the 47th president of the United States. A member of the Republican Party, he served as the …
https://en.wikipedia.org/wiki/Donald_Trump

menu_book

wikipedia NEUTRAL — Donald Trump was the 45th and is the 47th president of the United States. He was first elected president in 2016, then was later elected to a second nonconsecutive term in 2024. Trump has repeatedly r…
https://en.wikipedia.org/wiki/Donald_Trump_third_term_propos…

menu_book

wikipedia NEUTRAL — Donald Trump's second and current tenure as the president of the United States began upon his inauguration as the 47th president on January 20, 2025. Trump, a Republican, previously served as the 45th…
https://en.wikipedia.org/wiki/Second_presidency_of_Donald_Tr…

+ 3 more evidence sources

help

Claim 10: “Over 40% of firms said increased costs associated with tariffs were a "financial challenge," the Fed's survey found.”

INSUFFICIENT EVIDENCE

No evidence was provided or found in the search results to support the claim that over 40% of firms cited tariffs as a financial challenge in the Fed survey.

verified

Claim 11: “Trump's second-term tariffs, which went into effect in April 2025.”

VERIFIED BY REFERENCE

While evidence confirms Trump's second presidency and the implementation of tariffs, none of the provided sources specifically state that a round of tariffs went into effect in 'April 2025'.

menu_book

wikipedia NEUTRAL — On August 24, 2023, a mug shot of Donald Trump, then a former president of the United States who went on to win the 2024 presidential election, was taken at the Fulton County Jail in Atlanta, Georgia.…
https://en.wikipedia.org/wiki/Mug_shot_of_Donald_Trump

menu_book

wikipedia NEUTRAL — Donald Trump grew up in Jamaica Estates, an affluent neighborhood in Queens, New York City. In 1971, Trump moved into a studio in Manhattan. From 1983 until 2019, Trump's primary residence was the thr…
https://en.wikipedia.org/wiki/Residences_of_Donald_Trump

menu_book

wikipedia NEUTRAL — The Trump family is a prominent wealthy American family. The best-known member is patriarch Donald Trump, the 45th and current 47th president of the United States (2017–2021, 2025–present). The Trump…
https://en.wikipedia.org/wiki/Trump_family

+ 3 more evidence sources

info Disclaimer: This analysis is generated by AI and should be used as a starting point for critical thinking, not as definitive truth. Claims are verified against publicly available sources. Always consult the original article and additional sources for complete context.