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Founded in Ottawa, Canada in 2004, Shopify offers a cloud-based commerce platform designed to make it easier for businesses to create purchases online, although it also caters to in-store transactions. with a point of sale system to accept card payments.
The new Shopify Capital program is limited to those in the United States at this time and can be used for just about anything to grow a business, like purchasing equipment, increasing inventory, launch of new products and hiring of staff. Merchants have easier access to capital, while Shopify makes money by driving business among its merchants – it charges fees for processing payments and transactions. In other words, what’s good for the merchant is good for Shopify.
It should also be noted here that these are cash advances and not loans, which means there are no fixed monthly payments and banks are not involved – repayments are made. automatically via sales made between the merchant and his customers. Thus, the more they sell, the faster the advance is repaid.
“For many merchants, obtaining capital is a frustrating and time-consuming process,” Saad Atieque, Shopify product manager, said in a Press release. “With Shopify Capital, we’re giving entrepreneurs a quick, easy and convenient way to get financing to invest in their business.
Shopify is the latest in a series of ecommerce companies to offer loans or cash advances to merchants. Amazon has loans offered to online sellers since 2012, while the mobile payment company Square launched Square Capital back in 2014.
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