Are you a small entrepreneur wondering if it is possible to scale your Amazon business with little to no money? Don’t worry, Amazon Lending might be the solution to reducing your financial stress.

Although Amazon Lending has been around for 9 years now – which is testament to its reliability – many sellers are still unaware of the existence of this program.

Rightly so!

Until recently, this program did not have a dedicated website. And for many years, the tech giant kept it confidential from the press. It wasn’t until November 2017, that Amazon started to be more opened about it, allowing its Amazon Lending team to keep sellers informed by sending out a newsletter.

This is how Amazon greeted its potential borrowers:

“Welcome to the first edition of Amazon Lending’s Newsletter!” “The Newsletter is designed to connect with sellers like you, to share information that we hope will help you grow your business.”

Source: CNBC

Another reason why this program remains aloof from new entrants is partly because it is kind of hard to believe that the eCommerce leader would be open to provide start-up loans to small-scale entrepreneurs–considering the risks this entails.

Over the years, tons of sellers have greatly benefited from this program.

According to Markets Insider, at the end of 2019, Amazon Lending had $862 million in small business loans!

We have all the information you need to learn about this program and, eventually, help you make the final decision on whether Amazon Lending is the right choice for your emerging Amazon business in 2020.

Amazon Lending – How It All Started

After the 2008 financial crisis, the wait and technicalities involved in obtaining any kind of loan from a bank is often too big a hustle for small businesses.

Amazon Lending was released in 2011, aiming to help new merchants kickstart their business journey. Back in those days, the eCommerce giant opened up a broad spectrum of possibilities for new entrants to the platform with limited investment capital.

This program was, of course, well received by sellers and, despite some shortcomings, it has maintained a stable borrower base since. In 2018, Amazon even partnered up with Bank of America.

According to an article published by CNBC in 2018 by Eugene Kim, this partnership would “…allow Amazon to reduce its risk and access capital specifically to provide credit to more merchants so they can acquire inventory…”.

Amazon Lending’s International Presence

In 2020, Amazon Lending is available in the following US states:


And in the following countries:

  • Canada,
  • China,
  • France,
  • Germany,
  • Italy,
  • Spain,
  • India, and
  • The United Kingdom

Who Can Leverage Amazon Lending?

Amazon Lending is open exclusively to sellers on the Amazon marketplace. Moreover, not every seller can apply for a loan. Amazon keeps this privilege for the select few, and it is by invitation only.

If your track record on Amazon is clean, Amazon Lending may reach out to you to offer you a specific loan amount.

Your eligibility for a loan through Amazon Lending is determined by a set of algorithms that will evaluate your selling history.

These are some of the benefits of taking out a loan from amazon in 2020:

  • Upon prequalification, you get to choose the amount and term length that works for you.
  • There’s no penalty for prepayment.

Amazon Lending Criteria

You need to keep in mind that Amazon’s customer-centric approach rules each and every aspect of their business model. Therefore, before applying for a loan, please consider the following criteria:

1099-K Registration

You need to be registered 1099-K in a US state where Amazon Lending is available.

According to, the purpose of the 1099-K is “…to ensure that all online retailers are reporting sales for tax purposes…if you accept credit card payments online, you may end up with a 1099-K at the end of the year that summarizes all of your sales transactions…”.

Customer Satisfaction

You need to maintain a good relationship with your customers. Make sure to keep an eye on your Customer Satisfaction metrics (found on your Customer Satisfaction page), so you don’t fall short of the grace of Amazon.

Also, you need to give proof of non-serious customer complaints in the past six months (found on your Performance Notifications page) and non-outstanding copyright or trademark infringement complaints.


Your listings must be in compliance with Amazon listing Style Guides (for example, compliant image quality, no seller-specific information in ASIN listing information).

Note: In order to be considered for a new loan, make sure you have not received any previous Amazon Lending loans in the past 45 days.

Source: Amazon Seller Central

How Amazon Lending Works

Qualified sellers can borrow from 1,000 to 750,000 US dollars for up to 12 months through Amazon Lending.

This gives sellers the opportunity to expand their businesses to reach more customers in over 130 countries. Amazon is in a good position to make loans to smaller businesses. They hold the data necessary to decide who has the best chance of paying it back, on top of having to deal with less strict regulations than banks do.

Accepting and repaying a loan from Amazon is a very simple process and the interest rates range from over 6-17 percent annually.

Here are the basic steps and the benefits of borrowing from Amazon:

Simple Application

In 2020, it is easier to apply for a loan on Amazon. The only thing you need to do is to fill out a one-page application in Seller Central, and you’re ready to go.

Lower Fees and Interest

A loan from Amazon is like a cash advance, but with lower interest rates. The exact rates are undisclosed but are also lower than using credit cards.

There are no additional fees associated with Amazon Lending, such as origination, application, and closing fees, and pre-payment penalties, among others.

Just What You Need

Sellers are offered specific loan amounts, but they don’t have to borrow as much as they are offered. It is possible to take out only a portion of what is offered.

Simple Collateral

Amazon simply accepts a seller’s FBA inventory as collateral when a loan is approved. If you can’t pay, Amazon can hold your inventory or take it and sell it themselves to get their money back.

If you are not an FBA seller, then your earnings will go directly to Amazon in case of non-repayment.

Quick Release

An accepted Amazon Lending offer can be released to the seller’s account as soon as the following day, but not more than a week. This is much faster than traditional options. This is in large part because Amazon Lending has already screened the merchants to whom loans are offered.

You can check your loan status and history 24/7 in Seller Central.

Easier Repayment

Merchants who accept the loans will have to pay them back within a few months or up to a year by giving Amazon a cut of their sales. These payments are fixed monthly amounts that Amazon takes directly from the seller’s account. All you need to worry about with this scheme is making enough sales to cover your loan repayments.

Automatic Payment

Please keep in mind that your payments will be automatically deducted from your seller account. In the event that there aren’t sufficient funds in your account to make the payment, Amazon will deduct the remaining balance from the next disbursement.

Getting Started with Amazon Lending in 4 Easy Steps

  1. Log in to Seller Central.
  2. Check if your business is prequalified.
  3. Choose the amount and term length that makes sense for your business.
  4. Access your funds in Seller Central account within five business days.

Note: You might be prompted to submit additional documentation or information from Amazon to approve your loan.

Source: Amazon Lending

Lending Referral Program

Amazon Lending just unveiled a new program called “Lending Referral Program”.

Amazon partnered up with some local Chinese lenders that are willing to lend you money as long as you meet certain pre-qualification criteria determined by both Amazon and the lenders.

One of the lenders you may be receiving offers from in the near future is Shanghai Fuyou Commercial Factoring Co. Ltd.

Unfortunately, these pre-qualification criteria it’s not publicly available, but you can rest assured that all sellers will be measured against the same requirements.

If Amazon and the lenders believe you are eligible for a loan, you will receive offers to start your application process. Keep in mind that this program is also available by invitation only.

Loan Agreement

It is worth mentioning that Amazon does not take responsibility for the agreement between you and the lender offering the loan.

If you are concerned about how much of your data will be shared with the lenders, you can be certain that none of it will be distributed without your consent.  

Make sure to keep this in mind:

Upon receiving the loan offer, if you decide not to share your data with the lender, you may terminate your loan application by clicking ‘Cancel’.

If you agree to share your data and go ahead with the loan, the lender will have access to the following information:

  • Your sales rates, return rate, and growth,
  • Your product data,
  • Negative feedback,
  • Average FBA inventory value, and
  • Tenure on Amazon

This is the information the lender will share with Amazon once your loan has been approved:

  • Outstanding principal balance amount,
  • Next payment schedule, and
  • Repayment status

Individual and Professional Sellers

Both individual and professional sellers can apply for loans. However, it is important to consider that you’ll only be able to choose one of the offers you get–either from Amazon Lending or the Lending Referral Program.

Visit this page to see if you have received an offer from Amazon’s Lending partners.

Lender’s Contact Info

Since you will be signing a bilateral agreement with your lender, you will also maintain direct communication with him.

Click here if you’d like to see your lender’s contact info.

Is Amazon Lending Right for You?

Before you jump at the chance to grab an Amazon Lending offer, consider the following:

Amazon wants you tied in – Amazon is a business, and it is lending you money so that you can sell more on Amazon and get them a bigger cut.

This is, of course, on top of your interest payments.

An illustration of this is how sellers must use the loan amount for inventory expansion, and only within the marketplace. As mentioned above, Amazon is looking to gain more by encouraging more sales on Amazon.

It is therefore not an option to use the money elsewhere.

As stated on Amazon Lending’s landing page, these are some of the typical uses for the loan:

  • Buying inventory,
  • Gaining cost or production efficiency,
  • Bulk buying,
  • Investing in product development,
  • Advertising costs, or
  • Building business infrastructure

Keep in mind that you pay no matter how much you make.

It may be easier to just give Amazon a fixed amount every month, but only if you are consistently doing well. Paying a fixed fee instead of a percentage means that you pay the same amount even if you’ve had a bad month.

This can all be achieved with a great deal of effort and organization.

The good thing is that, since there isn’t an early payoff penalty, you can repay your debt as soon as you get back on your feet. And as a small-scale entrepreneur, having this type of financial help can help you develop crucial administrative, decision-making, and strategic planning skills to catapult your Amazon business to stardom.

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