Resource
A patient payment plan is not practice financing
CareCredit, Cherry, and Sunbit pay a practice for a discount fee at checkout. None of them fund payroll, equipment, an acquisition, or a build-out.
Direct answer
Patient payment plan products such as CareCredit, Cherry, Sunbit, and PatientFi are merchant services, 4 of them named here: they pay a practice up front for a discount fee so a patient can pay over time. They move case acceptance at the front desk. Practition Finance refers business financing for payroll, equipment, acquisitions, and build-outs, a separate category entirely.
As of October 2026
Why the two get mixed up
A practice owner who has just signed up for a consumer payment plan at the front desk often assumes the same relationship can fund the business side of the practice: a new laser, a second operatory, or a slow payroll month. The vendor even calls itself a financing company, and the paperwork looks like a credit application. The confusion is understandable, and it costs owners real time when they call the wrong number during a cash crunch.
The mechanism is different from the ground up. A consumer payment plan advances the practice its own money, minus a discount fee, against a purchase the patient already agreed to make. The provider is the patient's household budget, not the practice's balance sheet. The practice never borrows anything: it sells a receivable it already owns, one invoice at a time, to a merchant services company that then collects from the patient directly or through an installment servicer.
Business financing runs on a different set of facts. A lender or a factor reads the practice's tax returns, bank statements, collections history, or accounts receivable aging, not a single patient's credit file. The amount available is sized to the business, not to one treatment plan, and the money can be used for anything the business needs rather than being tied to a specific case. Confusing the two means a slow month gets treated as a marketing problem instead of a working capital problem.
How to tell which one you are looking at
- 01
Ask who signs the agreement
A patient payment plan product puts the patient's name on the credit agreement, and the practice is paid the discounted amount within a day or two of the charge. A business financing product puts the practice's name and the owner's guaranty on the agreement, and the practice repays the lender on a schedule set at closing. If the signature block names a patient, it is a checkout product, not a capital source for the business.
- 02
Ask what the money can be spent on
Money from a patient payment plan is already spoken for: it is the discounted proceeds of a specific treatment plan and shows up in the deposit for that patient's case only. Business financing proceeds arrive as an undesignated deposit or a line the practice draws against, usable for payroll, a lease payment, inventory, or a down payment on equipment. If the funds are earmarked to one case, they are not a capital tool.
- 03
Compare the cost structure
Consumer-facing merchant discount fees for products like Cherry, Sunbit, CareCredit, and PatientFi run from roughly 1.7% to as much as 15% per transaction depending on the promotional term the patient selects, priced as a percentage of the treatment cost. Business financing is priced as an annual rate, a factor rate, or a discount fee per invoice, sized to the business's own credit and cash flow rather than to a single case.
- 04
Check whether it appears on a credit report
A patient payment plan is a consumer trade line on the patient's credit file, reported by the merchant services company or its bank partner. A term loan, a line of credit, or a factoring facility shows up against the business's tax ID and, where a personal guaranty exists, on the owner's credit file as a business obligation. The two never appear on the same report and are not read together by either lender.
- 05
Match the tool to the actual gap
If the problem is a patient walking away from a treatment plan because they cannot pay in full, a checkout product solves it in minutes. If the problem is meeting payroll before next month's collections land, buying equipment, or financing an acquisition, the tool is a working capital loan, an equipment facility, a factoring line, or an acquisition loan, categories Practition Finance refers by state.
The comparison that settles it
| Dimension | Patient payment plans | Business financing |
|---|---|---|
| Who is underwritten | The patient's personal credit | The practice's tax returns and cash flow |
| What it funds | One treatment plan at checkout | Payroll, equipment, acquisitions, build-outs |
| Cost structure | Merchant discount fee per transaction | Rate, factor rate, or per-invoice discount fee |
| Speed of proceeds | Within a day or two of the charge | Days to weeks depending on structure |
| Where it is reported | Patient's consumer credit file | Business tax ID, and owner's file if guaranteed |
What to do with this distinction
Keep a checkout product at the front desk for case acceptance and treat it as a marketing and collections tool, not a line of business credit. Track its discount fee as a cost of sale against each treatment plan rather than folding it into the practice's overall cost of capital, since the two are priced on entirely different risk.
When the gap is on the business side, whether it is a slow month, an equipment purchase, or an acquisition, start from the business's own financials rather than from the checkout vendor's sales pitch. Practition Finance refers those categories by state once the underlying need is identified, and the request is read against the practice's collections and cash flow, not against any one patient's balance.
Do not use a patient payment plan's approval rate or advance speed as evidence the practice itself is creditworthy for a business loan; the two are unrelated underwriting exercises
The figures behind this
| What it measures | Market range | Confidence | How to read it |
|---|---|---|---|
| Consumer-facing merchant discount fees | Cherry from 1.7% to 1.9%, Sunbit about 4.7%, CareCredit about 5% to 12%, PatientFi 8% to 15%4 | DirectionalAugust 2026 | The range of discount fees charged across the major checkout products, priced per transaction. |
| Working capital structure | Up to $3,000,000, from prime, 10-year fixed, no personal guaranty on some files5 | VerifiedAugust 2026 | One published structure for business-side working capital, sized to the practice rather than to a patient. |
| Days in AR benchmark | Under 30 high performing, 30 to 40 acceptable, over 50 a problem6 | VerifiedAugust 2026 | The collections metric a business lender reads, unrelated to any single patient balance. |
What owners ask about this
01Can CareCredit or Cherry fund equipment or payroll?
No. These products advance the practice its own treatment revenue minus a discount fee, tied to a specific patient's payment plan. They are not sized to the business and cannot be drawn against for equipment, payroll, or an acquisition. A working capital loan, equipment facility, or line of credit is the category that funds the business itself.
02Does offering a patient payment plan help a practice qualify for a business loan?
Not directly. A business lender reads the practice's tax returns, bank statements, and collections, not the approval history of a checkout product. Consistent use of patient payment plans can support stronger collections by improving case acceptance, and that improved collections history is what a business lender actually credits.
03Why do practices confuse the two products?
Both are called financing, both involve a monthly payment, and both are offered by companies with lending in their name. The underwriting subject is different: one reads a patient's household credit, the other reads the practice's own financial history. The shared vocabulary is the source of the confusion, not the mechanics.
04Is one of these cheaper than the other?
They are not comparable on cost because they solve different problems. A checkout product's discount fee is paid once, on one case, in exchange for same-day cash. Business financing is priced against a loan or facility amount and repaid over months or years. Comparing a per-transaction fee to an annualized rate produces a meaningless number.
05What does Practition Finance refer in this category?
Practition Finance is an independent business financing referral service and does not refer consumer checkout products. It refers business-side categories such as working capital, equipment financing, medical receivables factoring, and acquisition loans, and, by state, refers those requests to funding partners who present any offer directly to the practice.
Sources
- 1Consumer Financial Protection Bureau, medical credit cards and payment plans
- 2Federal Trade Commission, consumer financing disclosures
- 3SBA, working capital loan programs
- 4withcherry.com, axiantpartners.com, practicesignal.com
- 5usmedicalfunding.com
- 6MGMA and HFMA aligned sources
A conversation about the actual gap, payroll, equipment, or an acquisition, starts with the practice's own numbers, not a checkout vendor's terms