Everything You Wanted To Know About E-Commerce Loans

One thing that you would surely agree with is that you need money to make more money even when you’re running an online business. Literally, everything counts whether it is hosting fees for your website or shipping expenses. 

When you have only a limited amount of resources, you will be missing out on some great opportunities to grow. 

But a lot of these worries can be calmed, thanks to ecommerce business loans. Let us explore more below.

Basics about the e-commerce business loan

Ecommerce funding is significant and is made of three elements. The first one is the principal, which is the amount you borrowed and need to pay back. The second element will be the interest rate which means the amount that the lender will charge you to borrow the money that would be expressed as a percentage.  Lastly, you also have to pay the fees, and you might even be charged extra; it all depends on the lender. The costs would be deducted even upfront or once the life of your loan is over.

Different types of e-commerce loans

You need to know that not all types of business loans are equal, as some are just perfect for quick-growing businesses while others can help you cover up some emergency. Some loans are ideal when you have only a little or no credit left. Here are some types of e-commerce loans that you should know about

  • Business term loan

A term loan is a specific loan product that you can just get more accessible as a lump sum cash. You can pay back a fixed amount over a given time. It is entirely stable and flexible. You should know what you must expect with the blessed term loan. The loan term is anywhere from a few months to even 20 years. The annual percentage rate goes from 5% to 35%. You must go for this loan as you can save money with the low-interest rate, and it is a predictable repayment schedule that makes it very easy for you to pay the money back; you can also borrow a considerable amount As compared to other financing forms.

  • Business credit card

A business credit card works like a personal credit card, but it is just for your business. You can use the business credit card for all your business expenses. It is a revolving credit, just like your personal credit card; it means that you can get access to your funds once you pay off the card. It is a great option to start with if you do not have any credit left. It has a minimum monthly payment option, and the annual percentage rate goes around 15%. There are several advantages of getting a business credit card like you can get cash back or even travel credits. At the same time, there are some potential annual fees and usage-based fees also.

  • A business line of credit

The business line of credit is a type of revolving credit. You can get an approved limit for a given credit limit. You can draw the funds whenever you need. Whenever you use the business line of credit, you have to just pay interest on the funds that you are using instead of the entire loan amount. For example, if you have access to $30,000 and you use only $20,000, and you have used only $20,000, then you also have access to $1,00,000. It is a never-ending loan. The term depends on how you are drawing your minimum amount; the annual percentage rate goes from 7% to 25%. You should go for this loan as you just have to pay interest on the funds that you end up borrowing, and you can borrow against the same credit line till the end of time.


So whenever you are stuck financing the expenses for your growth sales or any other issue, then chances are high that you might even lose cash opportunities or customers. Business loans can help you with these issues as you focus on the funds to grow your business. You can use the funds to buy inventory or even expand to brick and mortar business.

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