12 Ways eBay Sellers Can Get Funding
Most of us think of eBay as a means to make a little extra cash on the side (although others may consider it only as a place where we can order those elusive early 90s-era Ninja Turtles action figures we’ve been looking for). The truth is, if you’re inclined to get serious on the selling side, eBay can be so much more. Some folks have managed to leverage their eBay seller’s accounts into $25-million-dollar-a-year businesses. But you can’t achieve anywhere near this level of success as an eBay seller without some capital injection.
In some ways, an eBay business is like any other business, so the usual methods of funding a start-up apply. However, there are some funding avenues that particularly suit online vendors. Let’s explore the ways you can secure capital for your eBay business.
Table of Contents
1. PayPal Working Capital
One lender with obvious fluency in eCommerce is PayPal. PayPal Working Capital (see our review) offers loans that resemble merchant cash advances — after taking out the loan, you’re charged a one-time fixed fee. Paypal then takes a daily deduction of a percentage of your PayPal sales until you’ve paid off the loan and the fee, so long as you pay at least 10% of your loan every 90 days. If you fall behind on this, you’ll have to make catch-up payments. The maximum term length is 18 months.
PayPal Working Capital has obvious advantages for the eBay seller. Your PayPal sales history is what determines whether you’ll get the loan, so when you apply, there’s no hard credit check and no effect on your credit score. You’ll just need a PayPal Premier or Business account that’s at least three months old and that processes at least $15K a year with a Business account (or $20K/year with a Premier account).
With an APR that tops out at around 25% (and no interest), PayPal’s terms are pretty reasonable for a short-term lender. Click here to read our full PayPal Working Capital review.
2. LoanBuilder
If you want a more traditional loan option from PayPal to fuel your eBay business, look no further than LoanBuilder to get the funds you need. What’s unique about LoanBuilder (see our review) is that you can customize your borrowing amount, terms, and payments to best fit the needs of your business.
Through LoanBuilder, you can apply for $5,000 to $500,000. Repayment terms are between 13 to 52 weeks and are based on the amount of your loan. Fees range between 2.9% to 18.72% of the borrowing amount. While there are no prepayment penalties, you’re still required to pay the full fee if you pay off your loan early.
To qualify for a LoanBuilder loan, you must meet the following requirements:
- A time in business of at least 9 months
- A credit score of at least 550
- Annual revenue of at least $42,000
- Have a business based in the US
- No active bankruptcies
To apply for a loan, simply start off by completing a quick questionnaire. After filling out this questionnaire, your eligibility will be assessed and you’ll receive estimated offers. Filling out the questionnaire and receiving your offers will not affect your credit score.
If you’re satisfied with the offers presented to you, you’ll populate a more comprehensive application and submit documentation such as bank statements. A credit check will be performed and your public records will be evaluated during the underwriting process. Once all documentation and information are received and approved, you’ll get your loan funds within 24 hours.
No origination fees and single-fee fixed pricing, paired with the ability to “build” your loan, make this an uncomplicated, competitively-priced loan option for any eBay seller.
If you’re interested in learning more, check out our LoanBuilder review.
3. Kabbage
Kabbage (see our review) specializes in providing capital to online merchants. In fact, the company once dealt solely with online vendors, though they’ve now expanded to brick-and-mortar businesses as well.
Kabbage loans are offered as lines of credit. These lines can range from $2K to $100K. Each draw on a line of credit is an installment loan with a term of 6 or 12 months. The APR can be steep, though — rates typically range from 18% to as high as 102%.
Though Kabbage will take your credit score into consideration when assessing your application, they’re more concerned with your business’s profitability. To this end, they require:
- A time in business of at least 12 months
- At least $50,000 in annual revenue OR $4,200 per month for the last 3 months
When you apply for a Kabbage line of credit, you give Kabbage access to your PayPal and eBay accounts so they can assess your sales profits and your credit. If you are approved, the money will be deposited directly into your PayPal account. Bear in mind that your PayPal account is connected to your bank account, so if you’re delinquent in paying back the loan, Kabbage will withdraw the funds directly from your bank account. Ouch.
Given the fact that you can apply for a Kabbage loan, get a decision, and start withdrawing funds within minutes–and considering the company’s integration with PayPal and eBay–this is a convenient way for established high-volume eBay sellers to access a significant amount of capital very quickly. However, small-time sellers will find the high borrowing cost extremely onerous. Convenience is expensive.
Read our Kabbage review to learn more.
4. OnDeck
If your eBay business is in need of some leniency from a lender, take heart—OnDeck (see our review) is one of the most lenient lenders you’ll find. Offering short-term loans and lines of credit, OnDeck has relatively low borrower requirements. Borrowers must have:
- A time in business of at least 12 months
- At least $100,000 in annual revenue
- A personal credit score of 500 or above
OnDeck offers short-term loans up to $500K and lines of credit of with credit facilities up to $100K.
The equivalent APR can be as high as 98%, so OnDeck’s loans are on the pricey side. But if your eBay business needs a capital injection, OnDeck is worthy of consideration (especially if you aren’t eligible for less expensive financing). Read our full OnDeck review here.
5. Lending Club
Lending Club (see our business loans review) is one of the few online loan companies that offers personal and business loans. While both can be used to fund your eBay business, their terms differ. Lending Club’s business loans max out at $300K. The borrower requirements for Lending Club’s business loans are:
- Time in business of at least 12 months
- Fair credit score
- At least 20% ownership of the business
Lending Club’s personal loans have a maximum borrowing amount of $40K. To qualify for Lending Club’s personal loans, you must:
- Be a US citizen, permanent resident, or living in the US on a long-term visa
- Be at least 18 years old
- Have a verifiable bank account
As P2P lenders such as Lending Club tend to be more risk-averse than the other types of lenders mentioned above, you’ll need decent credit to obtain a loan. A credit score of at least 640 is required.
Between their personal loans and business loans, you may well be able to secure at least some funding from Lending Club if you have decent credit. However, if you’ve got both decent credit and a business track record of two years or more, you should be able to get your hands on a much more substantial amount.
If you’re interested, read our Lending Club business loans review and personal loans review.
StreetShares (see our review) is a peer-to-peer (P2P) lender that allows potential investors to compete for the opportunity to loan to you, potentially lowering your interest rate in the process. Aside from that distinction, StreetShares also stands out in that it was founded by veterans and is therefore known to be especially veteran-friendly (you do not need to be a veteran to qualify for funding, however).
To qualify for a StreetShares loan or line of credit, you’ll need:
- Time in business of at least 12 months
- Annual revenue of at least $25,000
- Credit score of 620 or above
One important thing to note is that if your business has already made $100K, you can qualify with only a six-month business history. Through StreetShares, you can borrow from between $2K and $100K with term lengths from 3 to 36 months. Repayments are made via weekly ACH withdrawals.
StreetShares’s unique structure, which can result in an APR lower than loans from immediate competitors, make it an intriguing option for the online vendor. Read our full StreetShares review if you’re interested.
7. Fundbox
A financing challenge for many business owners is a low personal credit score or non-existent business credit score. If you’re running a new business as well, it might seem impossible to find the financing you need to build your business. Whether you’re operating a new business, lack a solid credit history, or all of the above, Fundbox offers a solution.
Through Fundbox (see our review), you can receive a revolving line of credit up to $100,000 to fund your eBay business. To qualify, you must be a US-based business and meet the following requirements:
- At least $50,000 in annual revenue
- Own a business checking account
- Have activity in supported accounting software for at least 2 months OR business bank statements from the last 3 months
There are no minimum time in business or personal credit score requirements. Repayment terms are 12 or 24 weeks with flat fees starting at 4.66%. You only pay fees on the drawn amount, and you can save by paying off your line of credit early.
One of the biggest advantages of using Fundbox is the speed at which you can receive your funds. Fundbox can approve your line of credit in just minutes, and you can immediately make draws from your line of credit. These funds are then available in your business checking account in 1 to 3 business days.
If you’re interested in receiving a quick line of credit, learn more by reading our Fundbox review.
8. BlueVine
We’ve already explored a few lines of credit, but those options are capped at $100K. What if you need an extra financial cushion for your eBay business? BlueVine (see our review) could offer the solution with its lines of credit up to $250,000.
With just some basic information about yourself and your business, you can be approved within 20 minutes and initiate draws on your BlueVine line of credit immediately. Like other lines of credit on this list, this is a smart choice if you need access to cash on demand.
To qualify for a BlueVine line of credit, you must meet the following requirements:
- At least 6 months in business
- At least $100,000 in annual revenue
- A personal credit score of 600 or above
After filling out a quick application, you’ll connect your business bank account or upload bank statements for approval. Rates start at just 4.8%, and you only pay on what you’ve borrowed. There are no additional fees for opening a BlueVine line of credit or using your account. Repayment terms are generally 6 months; however, 12-month terms are also available to qualified borrowers.
If you want immediate access to funds and you meet all requirements, check out our BlueVine review before applying for your line of credit.
9. Lendio
If you’re unsure of what type of loan would be best for your business, it’s not uncommon to jump on a search engine and start shopping around your options. But what if you could see all of your loan options in one place — saving time and the effort of filling out application after application? The good news is that with Lendio, you can do just that.
Lendio (see our review) isn’t a direct lender. Instead, it’s a loan aggregator that has over 75 lending partners. This means that with just one application, you’ll receive multiple offers that you can compare to ensure you’re getting the lowest rates and best terms.
Through Lendio, you can apply for term loans, lines of credit, business credit cards, merchant cash advances, and other financial products to fund your eBay business. To apply with Lendio, you need to meet the following basic requirements:
- Time in business of at least 6 months
- Annual revenue of $10,000 or more
- Personal credit score of 550 or above
Additional requirements, information, and documentation required to receive your funding will vary based on the type of loan you’re seeking and the lender you select. Repayment rates and terms also vary by lender, loan type, creditworthiness, and other factors.
If exploring your loan options for your business is of interest to you, read our full Lendio review to learn more.
10. Behalf
If you’re an eBay reseller, you can use a Behalf line of credit to pay your vendors. Through Behalf (see our review), your vendors will be paid immediately for their goods or services, while you can receive terms of up to 6 months to repay your line of credit. Lines of credit are available in amounts from $300 to $50,000.
To qualify for a Behalf line of credit, there are no minimum time in business, annual revenue, or credit score requirements. However, to determine your eligibility, Behalf will consider your business history and credit profile.
Interest rates for using Behalf’s line of credit range from 1% to 3% per month, and there are no hidden fees.
If you’re interested in paying your vendors using a line of credit, learn more by checking out our Behalf review.
11. Kiva U.S.
Kiva U.S. (see our review) is a nonprofit crowdfunder with one particularly attractive feature for the eBay seller just starting out: 0% interest loans! When they say they’re a nonprofit, by gum, they mean it!
To qualify for Kiva’s 0% interest loans, you must:
- Be at least 18 years old
- Own a US-based business
- Use the loan for business purposes only
- Have no foreclosures, bankruptcies, or liens
With Kiva, you can only borrow up to $10K. And because it’s a crowdfunding service, it can take up to two months to get your money. Therefore, Kiva loans may be impractical for established sellers who need more funding and/or fast access to cash. For those of you just beginning to sell on eBay, however, Kiva U.S. is a uniquely attractive way to get a little interest-free startup capital.
Read our Kiva U.S. review to learn more about these folks.
12. Bitbond
If you’re not squeamish about looking into a truly non-traditional lender for some startup funds, you could try Bitbond. As their name suggests, Bitbond uses bitcoin as a payment network. This allows Bitbond to be a truly global P2P lender, and as the banks are eliminated from the process, the platform is relatively cheap as well.
When you apply for a Bitbond loan, you can connect your eBay account, and Bitbond’s algorithm will quickly assess your creditworthiness. With loans up to $10K, low interest rates of 1% to 4%, an average APR of 13%, and a focus on online vendors, Bitbond is a fresh and intriguing prospect for the eBay seller.
You may associate Bitcoin with smug anarcho-libertarians engulfed in vape clouds. If you’re reluctant to dip your toes into something based on Bitcoin, by all means, do your research. Feedback on Bitbond’s Trustpilot page is split, though the complaints are largely from lenders, not borrowers — and it’s borrowers we’re concerned with here! Visit Bitbond’s website for more information.
Final Thoughts
It’s not easy for traditionally-structured companies to secure business funding at all these days, much less eBay ventures, because the big banks simply don’t know how to treat online vendors. Thankfully, the last decade or so has seen a plethora of new online funding mechanisms arise to meet the demands of people thirsty to leverage the power of the internet to build thriving businesses.
Do your due diligence before borrowing from any source; compare all these solutions and more, because only you can determine what’s most appropriate for your particular needs. Good luck!
Erica Seppala
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