Shopify Loans vs Other Loan Alternatives

Small businesses often need access to capital to grow and expand. Whether it’s to purchase inventory, hire new employees, or invest in marketing, having the necessary funds can make all the difference. 

For many entrepreneurs, getting a loan is a common solution. However, with so many options available, it can be overwhelming to decide which loan is best for your business. In this blog post, we’ll compare Shopify loans with other loan alternatives.

Shopify Loans

Shopify Capital is a loan program offered by Shopify to eligible merchants. The loans range from $200 to $2 million and have fixed fees, not interest rates. The fee is based on the amount borrowed, the repayment period, and the health of the business. Shopify business loans are available to merchants who have been using Shopify Payments for at least 90 days and meet certain revenue requirements.

One of the main advantages of Shopify loans is that the application process is quick and easy. Merchants can apply within their Shopify dashboard and receive a decision within minutes. The funds are then deposited into their bank account within a few business days. Additionally, Shopify business loans have flexible repayment options, with merchants being able to choose between daily, weekly, or monthly payments.

Other Loan Alternatives

While Shopify loans may work for some ecommerce businesses, others may want to explore options that would be a better fit for them. There are many loan alternatives available for small businesses, including traditional bank loans, SBA loans, and alternative lenders.

• Traditional Bank Loans

These loans are issued by banks and credit unions and typically have lower interest rates than other loan alternatives. However, the application process can be time-consuming and requires a lot of documentation. Additionally, traditional bank loans can be difficult to obtain for small businesses without a strong credit history.

• SBA Loans 

SBA loans are guaranteed by the Small Business Administration and are designed to help small businesses access capital. These loans often have lower interest rates than other loan alternatives and longer repayment periods. However, the application process can be lengthy, and there are strict eligibility requirements.

• Alternative Lenders 

Alternative lenders, such as Kabbage and OnDeck, offer loans with quick turnaround times and flexible repayment options. However, these loans often have higher interest rates and fees than traditional bank loans and SBA loans. Additionally, alternative lenders may require a personal guarantee or collateral.

• eCommerce Funding with Yardline

Yardline's ecommerce Funding solutions offer small businesses instant access to the best rates and terms to meet your business funding needs. Businesses are able to order more inventory, launch new products, and run more ads with Yardline’s extensive funding solutions including loans, revenue-based financing, business credit cards, inventory financing, and more. Get rates as low as 7.49% APR for qualified applicants and up to $20mm in funding for your business in as fast as 24 hours.

Comparing the Options

When deciding on a loan option, it’s important to consider your business’s specific needs and financial situation. 

For example, Shopify business loans may be a good option for merchants who need quick access to capital and have been using Shopify Payments for at least 90 days. 

However, if your business is not on Shopify, does not qualify for Shopify loans, or needs a larger loan amount, then you may want to explore other options. If you need quick turnaround times and flexible repayment options, an alternative lender, like Yardline, would be a good choice.

In conclusion, Shopify loans can be a great option for small businesses that need quick access to capital. However, it’s important to consider all loan alternatives and choose the one that best fits your business’s needs and financial situation.

Apply for funding with Yardline and watch your business grow with our extensive funding solutions.