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Amazon Funding Review: Pros, Cons, & How to Apply

Tech giant Amazon has recently expanded its massive product offerings to include Amazon Lending for third-party sellers that use the eCommerce platform. The invite-only small business lending program could help some sellers grow and expand their Amazon business.

The business funding programs are designed to help sellers who can’t qualify for traditional small business loans. However, the company doesn’t publish many details on available loan features. You must receive the invite to know your eligible borrowing amounts, interests, and terms.

This review can help you decide if Amazon Lending makes sense for your eCommerce business by covering the benefits, drawbacks, and application process. Specifically, we’ll answer these questions and more:

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    What is Amazon Lending?

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    The Amazon Lending program is an invite-only business loan opportunity for eligible small business owners who sell on Amazon’s eCommerce platform.

    Amazon funds the loans directly or offers the funding with third-party lenders. Lendistry partners with Amazon for some loans. Marcus by Goldman Sachs partners with Amazon for its business line of credit products. Parafin is Amazon’s funding partner for merchant cash advances.

    The lending program is designed to help eCommerce sellers obtain funding to grow their businesses. Getting funding from a traditional business financing provider for an eCommerce business is often difficult. However, Amazon Lending provides a quick and convenient solution – if you qualify and get an invite.

    What business loans does Amazon Lending offer?

    money, finance, mortgage, line of credit, lines of credit

    Eligible sellers could receive an invitation for one or more small business loan offers. Unfortunately, Amazon doesn’t provide any upfront information on borrowing ranges, interest rates, or terms. Here are the available financing options.

    Business Term Loans

    Business term loans are traditional financing structures where a borrower receives a lump sum payment, which is repaid plus interest and fees in fixed payments. Amazon’s term loans have a fixed interest rate, so the repayment amount remains unchanged throughout the loan.

    The principal balance and interest are paid in equal parts with monthly payments. Amazon funds these loans.

    Amazon Community Lending Program

    Amazon also partners with Lendistry, an established minority-led Community Development Financial Institution (CDFI), to offer term loans to “socially and economically distressed communities” in urban and rural areas.

    Examples include minority-owned businesses, low-to-moderate income communities, and other historically disadvantaged business owners. Eligible businesses could receive $10k – $250k with competitive APRs and terms.

    Amazon Interest Only Loan

    An interest-only (IO) loan is a term loan with an initially low monthly payment because borrowers are only required to pay the interest. Once the interest-only payment period expires, borrowers must pay the principal balance and any remaining interest equal monthly payments for the remainder of the term.

    Interest-only loans can help borrowers save on payments for a bit, but it requires much larger loan payments on the back end. If you use this form of financing, ensure you have a plan to cover the larger balloon payments after the IO period expires.

    Amazon Business Line of Credit

    An Amazon business line of credit (LOC) activates your funds as an available credit limit rather than a one-time lump sum disbursement. You can draw funds from the credit line to cover expenses, purchase inventory, and more.

    Amazon business lines of credit are suitable for covering unexpected expenses. You only pay interest on the funds you draw. You’ll receive a fixed interest rate on the LOC.

    Amazon partners with Marcus by Goldman Sachs to offer LOCs. If you’re invited to apply, you’ll start the process on your Amazon Seller account but finish applying on the Marcus by Goldman Sachs website. You can access the funds in the Marcus business lines of credit if approved.

    Merchant Cash Advance

    Merchant cash advances (MCAs) are unique business funding structures where a borrower receives a lump sum cash advance repaid with a percentage of the seller’s future sales. MCAs are one of the most accessible but expensive funding options for small businesses.

    The amount you receive for an MCA is based on your previous Amazon sales history. Amazon partners with financing provider Parafin for its MCA product.

    Instead of an APR or interest rate, MCAs use a fixed capital fee, sometimes called a factor rate, typically expressed as decimals. Factor rates are easy to calculate but costly, and difficult to compare costs with loans that use an APR.

    Amazon doesn’t publish rates for merchant cash advances, but factor rates for MCAs from other lenders range between 1.05 and 1.9. Multiply the cash advance amount by the factor to calculate your repayment total.

    For example, if you received an MCA for $50,000 at a factor rate of 1.2, the formula is:

    $50,000 x 1.2 = $60,000. That means your fixed capital fee is $10,000 in addition to repaying the principal balance of $50k. While you can think of the $10,000 as “interest,” the funding arrangement is a business-to-business transaction where the funder purchases $60k in future receivables for the $50k advance.

    Most MCAs are short-term loans, usually repaid within 3 – 24 months. Again though, Amazon doesn’t provide terms.

    It also doesn’t provide repayment frequency or holdback rates. Most MCAs from other funders are repaid with daily or weekly payments but daily is far more common. The holdback rate refers to the percentage of your daily (or weekly) sales that go to repayment.

    Terms, holdback rates, and repayment frequency are vital information for determining if your business can afford the MCA. Ensure you carefully review the terms and develop a budget plan before agreeing to any MCA.

    While MCAs can be very useful when applied correctly, they can also cause significant cash flow problems and put your business at risk if you don’t have a plan. We typically only recommend MCAs when you’ve exhausted all other options.

    Who is eligible to receive an Amazon Lending loan?

    Amazon Lending program loans are invitation-only, meaning Amazon will let you know if you’re eligible. When you log in, look for the invite on the Amazon Seller Account homepage.

    For Amazon Lending, You need to Know That:

    Amazon bases its eligibility criteria on your sales performance rather than traditional lending factors like credit score or time in business. Of course, you’ll need at least some time in business to have a proven track record of sales.

    Keep checking your seller account if you don’t have an invite yet. A higher sales volume will increase your likelihood of a future invite.

    There’s no credit check or collateral for the Amazon Lending program. Instead, Amazon and its lender partners secure the loans with your seller account.

    Amazon Lending does not have a business loan affiliate program. ISOs and business loan brokers cannot offer Amazon’s lending products to their small business clients.

    How to apply for Amazon Lending:

    Business owners cannot apply directly to Amazon Lending. If you received an invite on your seller central homepage, follow the instructions in the invitation.

    It can take up to five days to receive approval. Once approved, the funds are electronically sent to your seller or bank account.

    Amazon Lending, Post Funding:

    The funds for repayment come directly from your Amazon Seller account. The repayment frequency depends on your type of loan.

    You may receive additional invites for Amazon loans as you repay your current one. Some customers stated they received better terms and interest rates after the initial loan.

    What are the advantages of Amazon Lending?

    The program provides financing opportunities for business owners who traditional lenders often overlook. Many banks and credit unions don’t know what to do with eCommerce businesses because they don’t fit neatly into the conventional brick-and-mortar box.

    Another significant benefit is that it doesn’t require a credit check, meaning you could be eligible regardless of your credit score. It also doesn’t require collateral.

    The application process is entirely online and requires minimal documentation. Amazon has access to all the data it needs in your seller account, so you won’t have to provide extensive documentation to prove your financials.

    The company also partners with CDFI Lendistry for its Community Lending program. If you qualify, you could receive a very competitive interest rate and loan term.

    What are the disadvantages of Amazon Lending?

    The most significant drawback is that it’s invite-only, meaning no business owner can apply directly for financing. You also must be an active Amazon seller.

    Another major disadvantage is the approval and funding time. Amazon-funded loans could take up to five business days. Partner-funded loans have variable funding times. For comparison, many online lenders can approve and fund loans within 24-72 hours.

    The company doesn’t publish any information on borrowing amounts, rates, or terms. That can make it very difficult to compare costs ahead of time. Ensure you conduct your due diligence if you do receive an offer.

    Repayments for all Amazon loans come from your seller account, which could be risky. Since you’re already using the platform as your sales channel, shipping channel, and payout service, getting financing from the company instead of an outside lender could compromise your business autonomy.

    Pros & Cons

    pros, and, cons


    • Provides a financing option for eligible eCommerce sellers.
    • No minimum credit score or collateral requirements.
    • Online application process with minimal documentation.
    • Businesses eligible for Community Lending might receive generous rates & terms.


    • Loan applications are invite-only – can’t apply directly.
    • Only offered to active Amazon sellers.
    • Long approval & funding time for an online loan.
    • Lack of transparency on loan features like borrowing amount, rates, & terms.
    • Could compromise business autonomy and make you more dependent on Amazon.

    Apply for business funding through United Capital Source today.

    Amazon Lending Frequently Asked Questions

    Is Amazon Lending legit?

    Yes, the Amazon Lending program is a legitimate business loan platform offered by the world’s largest online marketplace. Its partnership with known financial services companies Lendistry and Goldman Sachs adds to its credibility, but the Amazon brand is already as credible as it gets.

    Is Amazon Lending a good idea for eCommerce sellers?

    Due to the lack of information on loan amounts, interest rates, terms, and repayment frequencies, we cannot definitively tell you if Amazon Lending business loans are a good or bad idea. We can tell you that when you receive an offer, you should carefully review the terms and rates and compare them to other lending offers – which is a good practice for all loans.

    That being said, these loans might be a good fit if:

    • You can afford it: Again, you must crunch the numbers on your interest rate and repayment total and ensure you have the budget for it. Compare the offer to other lenders to see if you can get a lower-cost option. It might be worth it if the Amazon loan offer is lower or competitive with other options.
    • You need the money: This is a no-brainer, but don’t take out a loan if you don’t actually need the funds. Avoid accepting just because they sent you the invitation. If you can use the money to grow your business, and have a plan for how to do that, then it’s worth it. Examples include purchasing more inventory, especially if you get a bulk discount, running a marketing campaign to increase your reach, or hiring additional staff to help you sell more.
    • You don’t have other options: Financing for eCommerce businesses is complicated. Sometimes you won’t have other funding options to invest in business growth.
    • You don’t have an urgent funding need: It takes a minimum of five days to receive the funds. If you need the money sooner, say to take advantage of a time-sensitive opportunity or cover a cash flow gap, look for an alternative lender that offers fast business loans.

    Why is it hard for eCommerce sellers to get a bank loan?

    Traditional lenders like commercial banks and credit unions still have an old-school way of thinking about business lending. They prefer working with conventional, established brick-and-mortar businesses with ample assets to provide as collateral.

    Lenders also don’t like issuing bank loans for smaller amounts. Most prefer more significant deals for six- or seven-figures because they yield a more significant profit margin off the interest. Both reasons make it difficult for Amazon sellers to get a traditional small business loan.

    eCommerce businesses typically need smaller amounts and don’t have high-value tangible assets. The advent of eCommerce is still disrupting traditional business paradigms, and many banks haven’t caught up yet.

    Fortunately, there are alternative lenders and lending marketplaces (like UCS) that know and understand the needs of eCommerce sellers. The program can provide unique solutions for Amazon sellers, but they’re far from the only game in town.

    What do Amazon Lending reviews typically focus on?

    Since Amazon Lending is invite-only and relatively new, few reviews are available. It can also be challenging to parse loan reviews from the company’s other significant products and services.

    However, from the few reviews we could find, customers liked that the application process was quick and easy once they received the invitation. Other positive reviews discussed the benefits of no credit reviews and said the service offered high borrowing amounts. Several users discussed receiving loan renewal offers at lower rates than the initial loan.

    Negative reviews mentioned receiving a high interest rate and only getting a six-month term for the first loan. Other complaints mentioned not getting future loan invitations.

    What if I'm not eligible for Amazon Lending?

    You’ll know if you’re eligible for Amazon seller financing if you receive an invite. If not, you can either wait until you get an invite or pursue financing from another lender or marketplace – perhaps one that accepts direct applications.

    As mentioned, many alternative lending options can cater to eCommerce sellers and retailers with short-term business loans. Most can offer business term loans, lines of credit, and merchant cash advances.

    Amazon sellers might also be interested in the following small business financing options:

    Making Your Decision

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    Amazon Lending is best suited for eligible eCommerce sellers who can use the funds to grow their business and have a plan to repay the loan. It could be a great opportunity since some lenders still hesitate to lend to eCommerce businesses. Still, it’s in your best interest to compare rates and terms with other online business loan options.

    Based on user reviews, available information, and the application process, we rate Amazon Lending at a 4 out of 5. Its lack of transparency and invite-only application process are significant issues. However, it’s still a unique and versatile loan program from one of the world’s most influential and economically significant brands.

    Disclaimer: The Amazon Lending trademark is owned by Amazon Inc., and its use herein is for reference purposes only, and it does not indicate sponsorship or endorsement from Amazon Inc.

    Apply for business funding through United Capital Source today.

    Why Choose United Capital Source?

    Why businesses choose UCS:

    Quick funding options that won’t affect credit
    Access to 75+ lenders with multiple products to choose from
    Financing up to $5 million in as few as 3 days
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        At UCS, we understand the value of your time and want to ensure that your application has a great chance of approval. Please take note of the following details before applying:
        • To be eligible, it’s necessary to have a business bank account with a well-established U.S. bank such as Chase, Wells Fargo, Bank of America, Citibank, or other major banks. Unfortunately, online-based bank accounts like PayPal, Chime, CashApp, etc., are not permitted.
        • When describing your current average monthly sales deposits to your business bank account, please provide accurate information. Our approval process is based on your current business performance, and it’s essential to provide accurate details about your current sales in the first question on the application form. We cannot approve applications based on projected revenues after receiving funding.
        We appreciate your understanding and cooperation in ensuring a smooth and successful application process.
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