Walmart is working to bolster its online retail division, driving more customers to the retailer’s e-commerce marketplace.
The strategy appears to be working, with a 97 percent growth in the company’s second quarter for fiscal year 2021. By comparison, the retail industry’s average e-commerce sales were up only 27 percent.
In June 2020, Walmart announced it would be partnering with Shopify, allowing its sellers access to Walmart Marketplace. According Walmart Marketplace vice president Jeff Clementz, the purpose of the Shopify partnership is to integrate approximately 1,200 small and medium-sized businesses into Marketplace as part of a strategic focus on growing the platform.
Now, Walmart is joining forces with Marcus by Goldman Sachs to offer Marketplace sellers line of credit. Select sellers will be allowed to apply for capital in the $10,000 to $75,000 range.
“Lines of credit offer businesses the flexibility to access money when they need, which could help them move fast and meet surging customer demand. It could also help fund innovation as we’re all working to adapt to constantly changing customer behavior and preferences,”Clementz said in a blog post.
A flexible financing option, the Marcus line of credit will allow businesses to obtain funds needed for a 12-month draw period with interest accruing at a fixed rate – approximately 6.99 to 20.00 percent – on the borrowed amount. Minimum payments must be paid every two weeks, and businesses will have the opportunity to renew the line of credit at the end of the draw period if approved.
To be eligible for the line of credit, a business must be a U.S. business that is at least two years old, have a U.S. business checking account, have ownership of 25 percent or more of the business and authority to apply for credit.