PayPal Working Capital gives businesses access to the capital they need, but it’s faster and easier than traditional loans. It’s available to select businesses that already process payments through PayPal. If your business qualifies, the lender reviews your PayPal sales history to customize a special offer.
PayPal Working Capital is type of short-term loan that gives e-commerce businesses an advance on future PayPal sales. Though it’s technically a loan, in reality it’s a lot closer to a merchant cash advance that offers financing based on future transactions.First-timers can take out a loan worth up to 25% of their yearly PayPal sales or $97,000. You pay it back plus a fixed fee by allowing PayPal to take a percentage of your daily sales until the loan is repaid.
PayPal is an unconventional way for online businesses to get funding quickly. And we mean really quick — you can get approved within a minute. When approving your loan, PayPal considers your PayPal sales history only, so applicants with bad or no credit are welcome. You won’t pay late fees or annual maintenance fees — just one fixed amount that you pay as a fee. Your fixed amount is determined by your loan amount, your PayPal sales history and the percentage of each sale you’re willing to let PayPal take as repayment. That’s it.
PayPal Working Capital is a business loan with one affordable, fixed fee. You repay the loan and fee with a percentage of your PayPal sales. There are no periodic interest charges, monthly bills, late fees, pre-payment fees, penalty fees, or any other fees.
The process is easy:
1. Select your loan amount. The maximum loan amount depends on your PayPal sales history.
2. Choose the percentage of your PayPal sales that will go toward repaying your loan and fee.
3. If approved, receive the funds in your PayPal account within minutes.
4. Repay automatically with a percentage of each sale until your balance is paid in full. You can also make manual payments or even pay the loan in full without penalty.
To be eligible to apply for PayPal Working Capital, you must:
Have a PayPal Premier or Business account for 3 months or more
Process between $20,000 and $20 million in annual PayPal sales if you have a Premier PayPal account or between $15,000 and $20 million in annual PayPal sales if you have a Business PayPal account
Pay off any existing PayPal Working Capital loan
Repayments get automatically deducted from your PayPal account as a percentage of each sale until the loan amount and fee are paid in full. You can also make manual payments or even pay the loan in full without penalty.
Your PayPal Working Capital loan is based on your current PayPal sales history. You repay the loan and fee with a percentage of your PayPal sales. The more you sell through PayPal, the faster you repay your loan and the more funding you may qualify for in the future. Sales outside of PayPal do not impact the offer, nor are they affected by repayment. However, to receive a PayPal Working Capital loan you must agree to keep processing payments through PayPal. You cannot deliberately direct customers to use another payment method. We’ll monitor accounts for unexpected drops in PayPal sales volume, and your loan will be in default if you move your sales away from PayPal to avoid repayment.
Because your automatic repayments get deducted as a percentage of each PayPal sale, the amount you repay each day changes with your sales volume. The more you sell, the more repayment progress you’ll make that day. On days without sales, you’ll make no payments, but there is a minimum repayment requirement every 90 days. Depending on the loan terms you choose, you must pay at least 5% or 10% of your total loan amount (loan + the fixed fee) every 90 days.
The 5% minimum applies to loans estimated to take 12 months or more to be repaid, based on your business’ past PayPal sales and other factors. The 10% minimum applies to loans estimated to be repaid within 12 months.
Here are some examples:
If you borrow $10,000 ($9,800 loan + $200 fixed fee) and the loan is estimated to be repaid in 13 months based on your previous years’ PayPal sales, then your minimum repayment is 5% or $500, every 90 days.
If you borrow $30,000 ($29,500 loan + $500 fixed fee) and the loan is estimated to be repaid in 8 months based on your previous years’ PayPal sales, then your minimum repayment is 10% or $3,000, every 90 days.
For most of our customers, regular automatic repayments easily cover the minimum and this is never an issue. But if you do get behind, you can make additional payments on the PayPal Working Capital website.
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