Marketplace seller funding helps online sellers on platforms like Amazon, Walmart, and Shopify get the cash they need to grow their businesses. Each platform offers unique funding options tailored to their sellers. Here's a quick comparison:
- Amazon Lending: Invitation-only program offering term loans, lines of credit, and merchant cash advances. Fixed monthly payments make it ideal for sellers with steady sales.
- Walmart Marketplace Capital: Partners with lenders like Parafin to provide funding tied to sales performance. Best for growth-stage businesses with at least six months of sales history.
- Shopify Capital: Offers loans and cash advances based on Shopify store performance. Repayments adjust with daily sales, making it great for seasonal businesses.
Quick Comparison
| Feature | Amazon Lending | Walmart Marketplace | Shopify Capital |
|---|---|---|---|
| Funding Range | $1,000 - $10M | Based on sales volume | $200 - $2M |
| Repayment | Fixed monthly payments | Tied to sales | Percentage of daily sales |
| Eligibility | Amazon sellers only | Walmart sellers (6+ months) | Shopify store owners |
| Approval Time | ~48 hours | Data-driven approval | 2-3 business days |
Each platform has its strengths. Amazon suits high-volume sellers, Walmart works well for growing businesses, and Shopify is perfect for those with fluctuating revenue. Choose based on your sales history, cash flow needs, and growth goals.
Amazon's Funding Programs
How Amazon Lending Works
Amazon Lending is an exclusive program available only to selected Amazon sellers. It provides three main financing options:
| Funding Type | Amount Range | Key Features |
|---|---|---|
| Term Loans | $1,000 - $750,000 | 4–6 month repayment terms |
| Business Lines of Credit | Varies by seller | Flexible withdrawal options |
| Merchant Cash Advances | $500 - $10M | Based on sales performance |
Interest rates fall between 6% and 16%, and the review process typically takes five days. There are no fees for origination, applications, or prepayments.
"Amazon sellers need to maintain clean and accurate financial statements. This includes keeping track of inventory, sales, and expenses. Lenders want to see that you have a clear understanding of your business's financial health." – Chris Shipferling, Managing Partner at Global Wired Advisors
Amazon also integrates funding tools directly into its platform, making the process easier for sellers.
Amazon's Social Media Sales Tools
Through its partnership with Lendistry under the Community Lending initiative, Amazon offers term loans starting at $10,000. Repayments are automatically deducted from the seller’s business account, ensuring payments are consistent even if sales fluctuate.
What Amazon Sellers Need to Know
Before opting for Amazon funding, sellers should weigh the following:
- Funds are strictly for building or restocking Amazon inventory.
- Fixed monthly payments are automatically deducted, regardless of sales performance.
- If a default occurs, Amazon may seize and liquidate inventory used as collateral.
- Eligibility is based on account health, sales history, inventory levels, and other metrics.
This program works well for sellers with steady sales and clear growth plans. However, with loan terms lasting a year or less, monthly payments can be considerable.
Walmart's Funding Programs
Current Walmart Financing Options
Walmart Marketplace Capital offers merchant cash advances through three distinct programs aimed at helping sellers grow their operations:
| Program | Key Features | Benefits |
|---|---|---|
| Capital by Walmart | Flat fee with automatic repayment | Sales-based deductions, multiple funding channels |
| Capital by Parafin | No interest or late fees; 9-month term | Fixed percentage of sales, single capital fee |
| Capital for WFS | Inventory-focused financing | Flexible repayment options tailored to stocking needs |
To qualify for these programs, sellers must meet certain criteria:
- Have at least 6 months of Marketplace sales
- Possess a valid U.S. Taxpayer Identification Number
- Show strong sales performance metrics
- Maintain a solid business risk profile
- Comply with Walmart's Seller Performance Standards
Important: Sole proprietors are not eligible for these funding options.
Walmart's Payment and Growth Programs
In addition to merchant cash advances, Walmart supports seller growth through credit lines and repayment options. A partnership with Goldman Sachs offers credit lines ranging from $10,000 to $75,000 for eligible sellers.
"Access to affordable capital is more important than ever as businesses large and small work to adapt and evolve to serve customers and grow their businesses."
– Jeff Clementz, Vice President of Walmart Marketplace
Key features of the credit program include:
- Interest rates between 6.99% and 20.99%
- Lower rates for sellers with strong credit
- Seamless integration with Walmart Fulfillment Services (WFS)
Repayments are automatically deducted during each settlement period. If funds are insufficient, Walmart may debit the seller's bank account or collect from other receivables on the platform.
Which Sellers Fit Walmart's Programs
Walmart's funding solutions are best suited for:
- Sellers with strong performance metrics
- Businesses poised for growth
- Those with at least six months of sales history
- Incorporated businesses
The marketplace has seen rapid growth, with the number of sellers doubling in the past year. This growth has enabled Walmart to enhance its funding options, including partnerships like the one with Parafin.
"Parafin is on a mission to help grow small business. Walmart is a leader in the small-medium business economy and is driving life-changing growth for these businesses that ultimately deliver on Walmart's mission of helping people save time and money."
– Sahill Poddar, CEO of Parafin
To make the most of these funding opportunities, sellers should:
- Regularly review Seller Center notifications and performance metrics
- Maintain accurate financial records
- Strategically plan inventory investments
These programs highlight Walmart's focus on helping established sellers expand, offering a competitive edge compared to other platforms.
Shopify's Funding Programs
Shopify Capital: Program Details
Shopify Capital provides merchant cash advances and business loans ranging from $200 to $2 million. The program evaluates eligibility based on Shopify performance metrics rather than personal credit scores.
Eligibility requirements include:
- Operating in the United States, Canada, United Kingdom, or Australia
- A strong sales record and active engagement on the Shopify platform
- Consistent business performance indicators
- An active Shopify store with regular transactions
Shopify Capital offers two funding structures:
| Structure Type | Features | Repayment Method |
|---|---|---|
| Monthly-fee Loan | Fixed monthly fee + principal | Percentage of daily sales |
| Fixed-fee Loan | Single upfront fee + principal | Percentage of daily sales |
Borrowers are required to repay one-sixth of the loan every 60 days, with terms lasting up to 12 months.
How Shopify Capital Connects to Store Tools
Shopify Capital seamlessly integrates with Shopify's financial tools, such as Shopify Balance, Shopify Credit, and Shopify Bill Pay. This integration provides real-time insights into funding opportunities and automates the repayment process.
"You can click on your dashboard and indicate, 'Hey, I want to borrow $8,000.' You request the amount, and within days, it's in your account. With that influx of cash, you can hire someone new to work at your shop the next week if you want."
- Alison Ables, owner of Los Angeles–based Prelude & Dawn
Shopify’s data-driven approach has shown measurable results. Merchants who received Shopify Capital funding saw a 36% greater increase in sales over six months compared to merchants who did not receive funding.
Tips for Using Shopify Capital
Monitor Performance Metrics
- Keep a close eye on daily sales to ensure repayment rates remain manageable.
- Engage customers consistently to maintain strong sales.
- Minimize disputes to improve eligibility for future funding.
Make Strategic Use of Funds
"With Shopify Capital, our revenue increased by 40% to 50% - a direct result of expanding our inventory with new products."
- Jordan Lee, Owner, The Public Pet
Manage Cash Flow Effectively
- Schedule inventory purchases to align with peak sales periods.
- Balance repayment obligations with other operational expenses.
- Explore early renewal options if eligible.
Shopify Capital provides quick funding decisions, automated repayment tied to sales, and integration with Shopify’s store tools. This makes it a tailored funding solution, offering a distinct alternative to programs from Amazon and Walmart, which will be explored in further comparisons.
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The Best Finance Options For Amazon Sellers
Platform Funding Comparison
Here’s a breakdown of the differences between Amazon Lending, Walmart Marketplace, and Shopify Capital to help you decide which funding option suits your business needs.
Key Features Chart
| Feature | Amazon Lending | Walmart Marketplace | Shopify Capital |
|---|---|---|---|
| Funding Range | Starting at $5,000 | Based on sales volume | Up to $2 million |
| Interest/Fees | 10-16% interest | 0.5-4% of sales (11.9-19.9% APR) | Fixed fee + principal |
| Credit Check | No | No | No |
| Repayment Structure | Fixed monthly payments | Tied to sales | Percentage of daily sales |
| Approval Time | 48 hours max | Data-driven approval | 2-3 business days |
| Eligibility Requirements | Amazon selling history | Active Walmart seller | Shopify store performance |
This chart highlights the primary differences, setting the groundwork for further comparisons.
Pros and Cons of Each Platform
Amazon Lending
- Advantages: Offers both term loans and lines of credit, with interest rates ranging from 10-16%.
- Limitations: Only available to qualified Amazon sellers, and repayment requires fixed monthly payments, regardless of sales performance.
Walmart Marketplace
- Advantages: Funding is tied to marketplace performance, avoiding fixed monthly payments. Walmart has seen 30% sales growth over the past four quarters, and the program benefits from fintech partnerships.
- Limitations: No significant drawbacks identified based on current data.
Shopify Capital
- Advantages: Provides funding up to $2 million and integrates seamlessly with Shopify’s ecosystem. Repayments are automated, based on a percentage of daily sales, and it’s available in the U.S., Canada, the U.K., and Australia.
- Limitations: Only accessible to Shopify merchants.
Now, let’s dive into which platform fits different types of sellers.
Matching Sellers to Platforms
High-Volume Sellers
Amazon Lending is a great choice for sellers with consistent, high-volume sales. As John Boumphrey, Amazon UK Country Manager, explains:
"We know from our sellers in the UK that term financing options are an important means for increasing cash flow, and growing and expanding their businesses. We are excited to partner with TradeBridge to offer Term Financing which will benefit a range of sellers on Amazon, whether they are looking to simply better manage cash flow or support larger scale investments like infrastructure and technology upgrades. We remain committed to supporting the growth of small businesses on our stores by providing them with flexible, accessible funding options."
Growth-Stage Businesses
Walmart Marketplace funding is tailored for businesses in a growth phase. Sahill Poddar, CEO of Parafin, notes:
"Parafin is on a mission to help grow small businesses. Walmart is a leader in the small-medium business economy and is driving life-changing growth for these businesses that ultimately deliver on Walmart's mission of helping people save time and money."
Seasonal Businesses
Shopify Capital’s repayment model, which adjusts based on daily sales, is perfect for businesses with seasonal fluctuations in revenue.
Key Considerations for Choosing a Platform
-
Sales Volume and History
- Amazon: Best for established sellers with consistent sales.
- Walmart: The platform saw 20% seller growth in fiscal 2023.
- Shopify: Works well for businesses of all sizes due to its flexible funding options.
-
Cash Flow Needs
- Amazon: Fixed payments require reliable income.
- Walmart: Fees range from 0.5-4% of sales.
- Shopify: Repayments automatically adjust with revenue.
-
Growth Strategy
- Amazon: Supports steady, planned expansion.
- Walmart: Focuses on marketplace-driven growth.
- Shopify: Integrates funding with its suite of business tools.
Conclusion: Making Your Funding Choice
Choose funding that aligns with your business stage and cash flow needs. Over the past five years, fintech lending to small and medium-sized enterprises has grown by 72.4% annually, highlighting the rising popularity of platform-specific funding options.
When deciding between funding from Amazon, Walmart, and Shopify, keep these key points in mind:
Business Stage and Sales History
Your business stage plays a big role in determining eligibility. Amazon Lending often requires an established sales history, while Walmart Marketplace and Shopify Capital cater to businesses at different maturity levels. Also, think about how repayment terms match your revenue flow.
Cash Flow Management
Repayment structures vary significantly. Amazon uses fixed payments, which work best for businesses with steady income. Walmart and Shopify, on the other hand, adjust repayments according to sales - ideal for seasonal businesses or those with fluctuating revenue.
"As the owner of your business, you know your business best. Use your funds on inventory, shipping and logistics, marketing spend, or anything else that would help grow your business and drive sales. We are always happy to strategize with you!"
Platform Integration Benefits
Each platform offers distinct advantages. Walmart’s partnership with Parafin emphasizes streamlined support for sellers. Sahill Poddar, CEO of Parafin, shares:
"Parafin is on a mission to help grow small businesses. Walmart is a leader in the small-medium business economy and is driving life-changing growth for these businesses that ultimately deliver on Walmart's mission of helping people save time and money. We are incredibly fortunate to begin working with Walmart to offer small-to-mid-sized businesses new resources to grow on Walmart Marketplace."
Funding Speed and Accessibility
Marketplace funding programs typically offer faster access to capital compared to traditional loans, which often require at least two years in business. These programs also feature simplified application processes, making them a better fit for businesses dealing with fluctuating sales cycles.
FAQs
What should I consider when deciding between Amazon Lending, Walmart Marketplace Capital, and Shopify Capital for funding my eCommerce business?
When choosing a funding option, consider key factors like eligibility, costs, and flexibility. Amazon Lending is invitation-only, while Shopify Capital requires you to be an active Shopify merchant. Walmart Marketplace Capital may have its own specific criteria, so ensure you meet the requirements before applying.
Compare the loan terms and repayment structures. Amazon Lending and Shopify Capital offer automatic deductions from your sales, but the repayment schedules and interest rates can vary. Evaluate how these terms align with your cash flow needs and business goals.
Finally, think about how quickly you need the funds and how you plan to use them - whether for inventory, marketing, or expansion. Approval and funding times differ between platforms, so choose the one that best supports your timeline and growth strategy.
How do repayment structures differ between Amazon Lending, Walmart Marketplace Capital, and Shopify Capital, and which option works best for businesses with unpredictable sales?
Repayment structures vary across these platforms, offering sellers different levels of flexibility. Amazon Lending provides term loans with fixed monthly installments or merchant cash advances, where payments are tied to a percentage of future sales. Shopify Capital automatically deducts a portion of daily sales revenue until the loan is repaid. Walmart Marketplace Capital aligns repayment with your sales, charging fees that typically range from 0.5% to 4% of sales.
For businesses with fluctuating sales, options like Amazon's merchant cash advance or Walmart's sales-based repayment can be more suitable. These structures adjust payments based on your revenue, making them ideal for managing cash flow during slower periods.
What are the eligibility requirements for funding on Amazon, Walmart, and Shopify, and how can I improve my chances of qualifying?
Eligibility requirements for funding differ depending on the platform, but here’s a quick breakdown:
- Shopify: To qualify for Shopify Capital, you generally need an active Shopify store, use Shopify Payments or a supported third-party payment provider, and be located in an eligible U.S. state.
- Walmart: Walmart Marketplace sellers can access funding through Walmart’s partnership with Parafin. Eligibility typically depends on being an active third-party seller on the Walmart Marketplace.
- Amazon: Amazon sellers may qualify for funding options like those offered by Onramp Funds, which usually require at least $3,000 in average monthly sales and a legally registered business in the U.S.
To improve your chances of qualifying, focus on maintaining consistent sales, ensuring your account is in good standing, and meeting platform-specific requirements such as location and payment provider preferences. Regularly reviewing your business metrics and addressing any performance issues can also help strengthen your eligibility.
