Payoneer’s Capital Advance, the newest instant capital provider in town

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  • Payoneer will likely get a huge portion of America’s business sector by providing instant capital to online sellers
  • The payments company just announced the launch of its new financial product Capital Advance
  • Ecommerce sites often have difficulty getting capital from traditional providers

 

Ecommerce merchants using Payoneer now have access to instant capital thanks to the company's Capital Advance service, a new financial product available to Payoneer users in the United States. Payoneer executives say that Capital Advance is a unique way for merchants to scale their businesses and access to loans only takes a few clicks on their platform.

With small businesses making up 99.7% of America’s business sector, it is not surprising that the need for capitalisation is high. According to insiders, the main driver for Payoneer’s Capital Advance is to fill a need that traditional lending institutions are not capable of providing. The company also says that working capital is among the hardest resources to get in the United States, adding that securing such is particularly difficult for eCommerce sellers.

In a statement on Thursday, Payoneer representatives said that merchants do not only get instant capital from their platform but that obtained funds will also have low interest rates. PR Newswire says that the leading payment platform offers “low-cost and low-risk access to capital” that retailers need.

Payoneer is thrilled about this development, according to reports. "We understand that access to working capital is perhaps the most difficult challenge facing eCommerce sellers looking to grow their business. Payoneer's Capital Advance service provides merchants with instant access to the capital they need to reinvest into their business”, Payoneer CEO Scott Galit stated on Thursday.

“We're excited to offer a service designed to meet the specific needs of our eCommerce seller customers, further enabling them to smartly scale their businesses, sell more products, and increase their revenues", he added.

Apart from lending money to small scale businesses that are based online, Payoneer’s Capital Advance also uses machine learning technology to get to know the person behind a particular business and his or her capacity to pay for a loan. Payoneer says that the technology will be using historical sales data to determine if a merchant is eligible to get a loan or not.

The fact that there is no collateral needed for Capital Advance transactions makes the product more attractive to small businesses. There is also no red tape associated with credit report checks since banks and traditional lending institutions are not involved in the service.

Sellers on Amazon, Tophatter and Walmart can get a loan from Capital Advance and pay it back within 90 days, Payoneer executives say. The company also released a statement this week that it has already provided working capital to thousands of businesses online.

The service is innovative, according to observers, especially at a time when banks require so much information from loan applicants. Better access to such services can help businesses grow, PR Newswire notes. It also makes ecommerce businesses more competitive.


Daniel Webber
Daniel Webber
Founder & CEO
Daniel is Founder and CEO at FXcompared and has numerous years of experience in the international finance world, especially within the media, technology and property sectors. Daniel is passionate… Read more

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