If your business needs extra funds to settle some urgent payments, getting a small business loan would be a viable option. However, due to the strict loan requirements of traditional banks, it won’t be possible for some to obtain a loan.
Such businesses can take advantage of online lending companies like PayPal Working Capital. It’s a financing product, which is specifically designed to meet the needs of small businesses.
The lending amount is small, which means you have to face less stringent repayment terms. To know more about this option, just continue reading.
Who May Qualify
Only those people or businesses can apply for PayPal Working Capital who sell their products or services and collect their payments through PayPal. This suggests the limited types of people can obtain a loan through this option.
To elaborate it more simply, PayPal Working Capital is accessible for businesses with a PayPal business account. The account must have been active for not less than 90 days. In addition, the business must show a particular level of sales per annum.
Unlike the traditional loans obtained through banks, PayPal doesn’t ask you for a credit check. Moreover, your credit score won’t be affected if you chose this type of loan.
On the contrary, PayPal will just take into account the sales history while deciding to approve or deny a loan. Furthermore, those with a Premier account need to collect their sales worth $20,000 through PayPal.
How Much Can I Borrow?
The loan amount approved by PayPal Working Capital relies on the payment processing and sales history of your business. Although there isn’t a minimum loan amount, the maximum amount depends on the annual sales.
It is possible to borrow 35% of the sales amount that is obtained from the customers via PayPal. For instance, if $40,000 came through the PayPal sales previous year, you can borrow $14,000.
Even if you don’t need that much, you can apply for a lower amount. However, you should keep in mind that there is a limit for the first-timer. A business applying through PayPal Working Capital can apply for a maximum amount of $125,000.
Moreover, PayPal Working Capital allows you to obtain one loan at a time. Once you have paid off the existing loan, you can immediately borrow the new one.
So, there is no limit as to how many times you can borrow through PayPal Working Capital. Furthermore, it may take two to three days for the loan application to process.
Interest Rate
PayPal Working Capital doesn’t ask for a specific interest rate. On the contrary, it is based on a fixed fee. Such a fee is determined by taking into account these three key elements.
- Loan amount borrowed
- PayPal sales history
- Repayment percentage selected by the business
The repayment percentage is a fraction of annual sales. This amount is deducted automatically for the repayment of the loan.
How to Apply
Applying for a PayPal Working Capital loan is way too easy as compared to the application procedure required by the banks. In most cases, you can receive the money within a few hours or even minutes.
In order to apply for the PayPal Working Capital, you need an active PayPal business account. After providing some relevant information, you can apply for a small business loan.
After that, you have to specify the loan amount. The percentage for repayment is based on the loan amount. Before you finalize the deal, make sure to go through all the repayment terms.
For instance, you need to see how long it would take for complete repayment of your loan. Since there is no credit check, you don’t have to worry about your credit score.
Summary
If your small business is going through hard times, seeking a loan could help to push it a bit more. For obtaining a loan, you can rely on online facilities like PayPal Working Capital.
If you have a PayPal business account and you receive your payments through this platform, it would serve as a great choice. In addition, applying process is a breeze, and it takes just a few minutes to apply for a loan.
This makes PayPal Working Capital a great choice for small businesses.
