Shopify’s merchants can now access funding on its platform

  • By Zilla Efrat

Shopify Capital’s launch in Australia will allow merchants to apply for and pay back funding of up to A$2.5 million on the existing Shopify platform they use to run their businesses.

Almost 40 per cent of Australian merchants on Shopify sell internationally through features like Shopify Markets. Now, access to working capital through Shopify Capital now gives merchants greater scope to build their brand both here and internationally.

The funding, which will be deposited in as little as two days, will also help eligible merchants prepare for the upcoming peak sales season for which they need to order inventory, plan campaigns, sort shipping and hire talent.

In 2021, Shopify’s Australian merchants generated A$39 billion in economic activity and contributed 154,000 jobs.

Shopify recently released new features for Australian merchants, including a new B2B offering with the ability to sell wholesale, tokengated commerce to help brands reward loyalty and an integration with YouTube to give merchants and creators a powerful new way to connect to consumers.

Shopify Capital notes in a statement that it isn’t traditional financing. There’s no lengthy application process and it doesn’t do personal credit checks, take equity in the business or ask merchants for cash flow projections.

Instead, its experts review its data-informed and machine learning models to enable merchants to get the funding.

As merchants make sales, they repay based on an agreed fixed percentage of daily sales, lowering cash flow risks by removing the uncertainty of compounding interest rates and hidden fees. There is also no specified time limit for repayment.

Since launching in 2016, Shopify Capital has provided more than US$3.8 billion in funding to entrepreneurs in the United States, United Kingdom and Canada – a 90 per cent increase in total funding in the past 15 months.

This funding has been vital as businesses look to accelerate growth, with merchants that received funding through Shopify Capital averaging 36 per cent higher sales in the following six months compared to their peers.