Find Me Funders
Conversion rate
Also called close rate, submission to funding rate.
In the broker and funder world, the share of applications at one stage of the pipeline that reach the next, most commonly submissions that become funded deals.
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
The pipeline has several conversion points: lead to application, application to submission, submission to approval, approval to contract out, contract out to funded. Each is measured separately, and where an operation loses volume tells it what to fix.
The metric drives behavior that merchants experience directly. A shop with a weak submission-to-approval rate responds by submitting each file to more funders, which is why one application produces calls from a dozen companies. A shop with a weak contract-to-funding rate responds by chasing signatures harder, which is where same-day signing pressure comes from.
Funders track the mirror image. They monitor each broker's submission quality, approval rate, funding rate, and subsequent default rate, and they price and prioritize brokers accordingly. A broker who submits indiscriminately gets slower service and worse buy rates, which the merchant pays for.
The word also carries an unrelated meaning in card processing, where conversion or approval rate describes the share of attempted transactions that authorize successfully, and occasionally in lending, where it describes converting a drawn line into a term loan.
Where this one catches people
A high funding conversion rate is often quoted to merchants as evidence of quality. It measures how reliably a broker turns applications into commissions, not how well the funding fitted the businesses that took it, and a shop that funds nearly everything it touches is frequently one that places every merchant with whoever approves fastest.
Worked through
1,000 leads produce 300 applications, 240 submissions, 96 approvals and 42 fundings. Lead-to-funding conversion is 4.2 percent, submission-to-approval is 40 percent and approval-to-funding is 44 percent. The largest leak sits between approval and funding, which usually means price or competing offers.
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
Read next
Conversion rate — common questions
What does conversion rate mean?
In the broker and funder world, the share of applications at one stage of the pipeline that reach the next, most commonly submissions that become funded deals.
Where does conversion rate catch people out?
A high funding conversion rate is often quoted to merchants as evidence of quality. It measures how reliably a broker turns applications into commissions, not how well the funding fitted the businesses that took it, and a shop that funds nearly everything it touches is frequently one that places every merchant with whoever approves fastest.
Is conversion rate the same as an interest rate?
Conversion rate 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 conversion rate apply to?
Merchant Cash Advance, Working Capital, Business Line of Credit, Credit Card Processing.
Is there a worked example of conversion rate?
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 conversion rate?
Approval, Broker, Broker agreement, Commission, Credit box.
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.