Trying to run a business without enough capital is like embarking on a cross-country trip with no fuel. While it may be a worn-out maxim, it’s nonetheless true: you have to spend money to make money. Amazon seller lending program is the answer.

What happens when there isn’t an egg for the chicken to hatch from, though? This is where businesses elect to utilize small-business and short-term loans to meet their financial needs. In today’s world, it is rare for any business to be able to make it on its own and many will take out loans.

If your business is on Amazon, this may include receiving money from the Amazon Lending Program. While this is an extremely convenient option since you’re on there already, is it worth it? 

Let’s go over the basics of the Amazon Lending Program, when to utilize it, and how to get started!

What is the Amazon Lending Program

The Amazon Lending program is a short-term finance solution for eligible sellers on Amazon. The evaluation process for the availability of the program mainly involves the seller’s ability to grow sales. Evaluators determine this primarily through your track record of sales growth in the past.

Additionally, Amazon will evaluate the customer satisfaction of your business. Poor customer service could result in lost business which might hinder your ability to pay back the loan. 

As for the terms of the loan:

• Participants may take out a loan maximum of $750,000.
• The minimum loan amount to participate is $1,000
• 3-, 6-, 9-, or 12-month agreements are available

While Amazon does not disclose its interest rates, it is a fixed amount for the entirety of the loan. The options available will vary from business to business and Amazon will not give any concrete details before your business is eligible.

When to Utilize Amazon Lending

Since the purpose of your loan is an indicator of your ability to return on the investment, it’s an important consideration. Any time a business takes out a loan, it should take careful consideration of the motive behind it. 

Tempting as it may be to just accept any money that comes along, these loans are investments. If you spend them frivolously, they do a lot more harm than good. Before taking out a loan from the Amazon Seller Lending Program, plan how you will use that money and stick with it.

Some of the best ways to use money from the lending program include:

• Purchasing Inventory – Inventory management is one of the most difficult parts of running a successful Amazon Seller account. Short-term loans may assist in the financial pain of stocking up on the front end.
• Launching New Products – Need a little extra cash to get a new product across the finish line? Funding is great for helping reach your goal with a new product or offering.
• Boosting an Already Established Business – Sales are going well but a little money could put them over the edge? Short-term loans can propel your established business to the next level.

How to Avail the Amazon Lending Program

When Amazon has determined your business is a good candidate for the loan program, you’ll receive an invitation. There is not a way to currently initiate the process on your own, this invitation is the only way in. 

Once the offer is available, it will show up in your Amazon Seller Central account along with a link to apply. After you have submitted your application, Amazon averages about five business days for a review and decision. If any information is missing from the application or they need additional documentation, it may take longer.

After approval, Amazon establishes an automatic deduction from your Seller Central account balance. If preferred, businesses also have the option to schedule loan payments in automatic deductions from their bank.

Even if you are “automatically qualified,” Amazon will require this process of verification and review.

Don’t Go About it Alone!

 Navigating the complicated waters of any short-term business loan is a nightmare in the making. Even after thorough read-throughs, it is hard to determine if an opportunity may have been right for you.

Here at Anata, we specialize in helping Amazon sellers just like you, and even we can’t give a concrete yes or no without a conversation first. That’s because every situation is going to be different and every business is at a different stage.

Regardless of whether the time is right for a business loan now, it’s a good idea to think through if something like this could work. After all, almost any successful business on Amazon Seller Central will eventually have to consider the option.

If you’re looking for a little help, reach out to us online, in a private message, or right below this post in the comments!

What would you do with a little extra cash for your business?