A Shopify-Gallup survey of nearly 47,000 entrepreneurs conducted earlier this year found that 40% of them cited financial risk as a barrier to starting a business.
Shopify, currently a popular e-commerce platform for small and medium-sized retail and B2B businesses, wants to change the game of financial services for entrepreneurs. “Entrepreneurs are innovating at breakneck speed, and traditional banks are not keeping up,” the e-commerce technology provider said, adding that its new Shopify Finance product suite is expanding the financial opportunities available to startups. I’m trying to change it.
“Don’t let unnecessarily complex finance overshadow your dream of running a business,” Shopify said in announcing Shopify Finance. “Entrepreneurs deserve more recognition.”
Shopify’s financial services range from financing to tax management
The Shopify Finance suite includes the following financial products and services:
⦁ Shopify Capital provides eligible sellers with access to up to $2 million in “quick funding, regardless of size or financial maturity, with no impact to credit checks or personal credit scores” .
According to Shopify, Shopify Capital operates a “monthly loan cost structure” that lowers overall repayment costs if merchants repay their loans sooner. “This new pricing structure gives merchants more choice and flexibility specific to their business,” Shopify said.
⦁ Shopify Credit is an “all-pay” Visa business card that provides merchants up to 3% cash back on eligible marketing, wholesale, and fulfillment purchases. “Sellers can choose to pay their entire statement balance within one month, or pay a portion of their sales over time, for up to 10 months,” Shopify says. states.
⦁ Shopify Balance is a “free business account” that allows merchants to get paid as early as the next business day and comes with a 3.39% Annual Percentage Yield (APY) on every dollar spent in your Shopify Balance account . Shopify says sellers on the Shopify Plus plan can take advantage of 4.43% APY rewards, higher ACH financial transfer limits, and default next business day payments.
⦁ Shopify Tax allows eligible sellers to automate sales tax return filing and remittance. As a complementary service, Shopify Tax automatically deposits sales tax funds into your Shopify Balance account to meet your tax obligations.
⦁ With Shopify Bill Pay, merchants can pay their business invoices using the method of their choice, including credit cards, debit cards, bank transfers, and Shopify Balance, “regardless of whether the vendor accepts that form of payment.” can. Additionally, Shopify says the new service will allow merchants to process batch and recurring payments to save time and combine payments to save on transaction fees.
Shopify startup seller Pupsentials talks growth
Jake Chambers, co-founder of Pupsentials, which embroiders pet images onto apparel, said in a recent Shopify press release: Having worked with multiple financial vendors in the past, it makes a lot of sense to run your business on one platform. ”
Shopify Inc., based in Ottawa, Canada and with U.S. headquarters in San Francisco, partners with Stripe Payments Co. for money transfer and account services, with funds held in Evolve Bank & Trust and Fifth Third Bank . Shopify says its Shopify Credit and Shopify Balance Visa commercial credit cards are “powered by Stripe and issued by Celtic Bank under license from Visa USA Inc.”
Shopify added that “all funds through Shopify Capital in the U.S. will be issued by WebBank.”
In Shopify’s most recently reported quarter, the second quarter ended June 30, total product transaction volume on its e-commerce platform increased 22% year-over-year to $67.2 billion, with sales of 2.1 billion % increase to $2.05 billion, the company announced.
In North America, 117 of the top 1,000 online retailers use Shopify as their e-commerce platform. Top 1000 is Digital Commerce 360’s database of the region’s largest online retailers by annual web sales. In 2023, 117 online retailers had combined web sales of more than $9.72 billion.
Paul Demery is a contributing editor for Digital Commerce 360 covering B2B digital commerce technology and strategy. (email protected).
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