PayPal Working Capital lent $1 billion in 2 yrs
That’s not only one heck of a lot of money, but it would appear that their loan book is increasing with half the money loaned within the last five months and they’re currently extending $100 million per month of new finance.
Small business loans kicked off with companies such as iwoca and ezbob lending based on a seller’s eBay and Amazon turnover. Since then PayPal and Amazon have both launched loan products, although on different terms.
Amazon and PayPal prefer to be repaid at a set percentage of your earnings, but the limitation is that they’ll only offer loans based on the turnover that they can see. Companies like iwoca and ezbob will take a wider view of your business looking at your eBay, Amazon, PayPal and bank account income when assessing how much they’ll loan, but repayments will then be a regular monthly amount which will suit some, but may not be as convenient if you have swings in your business income.
iwoca have also branched out as a mainstrem small business loan lender to businesses which don’t traditionally trade on the web.
PayPal’s news showing the huge demand for small business finance shows no signs of slowing down. PayPal Working Capital operates in the US, the UK and Australia and will appeal to businesses who don’t qualify for traditional loans or who are looking for small amounts which frankly involve too much time and paperwork for a bank to bother with.
By the time a high street bank approves a loan it’s often too late and the business opportunity has passed, and that’s why PayPal Working Capital and their competitors are winning so much business.