Amazon lends more than $3 billion to third-party sellers
Amazon’s lending program has hit epic proportions, with one-third of loans being granted in the last year, alone.
The online giant’s Amazon Lending program has surpassed $3 billion in loans to small businesses since the service launched in 2011. Specifically, Amazon has lent more than $1 billion to small businesses in the last 12 months, and more than 20,000 small businesses have received a loan from Amazon.
The Amazon Lending program offers short-term business loans, for up to 12 months, to invited micro, small and medium businesses selling on Amazon. Invited small businesses can apply for loans ranging from $1,000 to $750,000. The program’s goal? To help Amazon’s third party companies to grow their business.
Half of the items sold on Amazon worldwide are from small businesses that offer their products through Amazon Marketplace, giving Amazon a ripe customer base. Besides giving these companies the capital needed to boost sales, and increase shopper loyalty and repeat visits, increased sales among its third-party merchants also benefits Amazon, which takes a cut of all transactions processed on its site.
“We created Amazon Lending to make it simple for up-and-coming small businesses to efficiently get a business loan, because we know that an infusion of capital at the right moment can put a small business on the path to even greater success,” said Peeyush Nahar, VP for Amazon Market-place.
“Small businesses are in our DNA. Amazon is providing capital to small businesses to help them expand inventory and operations at a critical period of their growth,” Nahar added. “We understand that a small loan can go a long way.”
Small businesses and entrepreneurs selling on Amazon also come from every state in the United States, and from more than 130 different countries around the world. Since its introduction, Amazon has issued loans to small businesses across the U.S., U.K., and Japan. More than 50% of the small businesses Amazon lends to take a second loan from Amazon, the company added.
The company said it is considering expanding the program to other countries where it operates marketplaces, such as Canada, France and China. However, there are no solid plans regarding the rollout's timing, according to CNBC.
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