Challenging Britain's banks the retail giant is now offering small business loans to UK firms selling products through its online marketplace.
British firms looking for small-business loans might soon be turning to online retail giant Amazon for cash.
Amazon Lending, the retailer’s short-term working capital loan arm, has operated in the US and Japan since 2012 lending out hundreds of millions of dollars. This morning the service has launched on an invite-only basis for UK businesses that sell products through Amazon’s online marketplace.
The move comes as the business lending market continues to heat up with small digital businesses looking to take on a market traditionally dominated by the banks. Amazon’s move is similar to PayPal’s Working Capital in the UK and Square Capital in the US, both of which offer small businesses that use their payment services the ability to borrow based on their sales history.
Amazon similarly will offer loans based on the sales data of third-party businesses that sell through its site and takes loan payments out of the sales proceeds it pays these businesses.
“We know a lot about our seller’s business and invite only those who we think are in the best position to take capital and grow,” Amazon Marketplace head Peter Faricy told Reuters.
In the US Amazon has offered businesses loans of between three and six-months and ranging from $1,000 to $600,000. This year Amazon Lending will also expand to Canada, China, France, Germany, India, Italy and Spain.