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E-commerce Financing

You could finance your e-commerce business with an unsecured business loan, a line of credit or a business credit card.

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Thanks to an explosion of e-commerce sites, it's never been easier to quit your day job to make a living selling custom T-shirts or whatever strikes your fancy. However, managing cash flow for a small business isn't always easy. You might find yourself in need of a business loan to help cover revenue gaps or to fill orders. This guide will take you through your options.

How do ecommerce business loans work?

An ecommerce loan is a type of financing for small online retailers. Because online lenders tend not to hold physical assets, such as retail stores, these loans are generally unsecured and are available for amounts less than $500,000. They can come as a lump-sum payment or as a line of credit.

Is my company considered an ecommerce business?
If you sell goods online, you have an ecommerce business.

What kinds of loans are available to ecommerce businesses?

The first step to finding a loan is learning about the options that are available for a unique business like yours.

  • Unsecured business loan. This is a loan that delivers funds to you as a lump-sum payment and requires you to repay them over a set term. You will usually have two years to repay the loan and you can generally borrow between $5,000 and $500,000. Compare unsecured business loans using the table on this page.
  • Lines of credit. If you want funds to support your cash flow or are not sure how much you will need and when, a line of credit may be an option to consider. These loans give you a total credit limit that you can draw on when you need. You only repay what you borrow and you are only charged for what you use.
  • Business credit card. You can also consider a small business credit card to support your online business. This is a good option if you have expenses to manage across multiple team members or you are looking to take advantage of business rewards programs. Remember that charge cards require you to pay the entire amount back in full at the end of the statement period so ensure this will work for your business's budget.

Online business loans you can apply for today

1 - 12 of 12
Name Product Min. Loan Amount Max. Loan Amount Loan Term Upfront Fee Filter Values
Banjo Business Loans
6 months to 3 years
up to 3% for the 36 month loan term
Available for businesses that are at least two years old and has an annual turnover of $500,000.
Lumi Unsecured Business Loan
3 months to 3 years
2.5% establishment fee
Apply for up to $300,000 from Lumi and benefit from short loan terms, no early repayment fees and once approved receive your funds in just one business day. Note: Loans settled by 30 June 2022 are eligible for a no repayment period for the first 6 weeks of the loan.
Valiant Finance Business Loan Broker
3 months to 5 years
$0 application fee
A Business Lending Specialist from Valiant Finance can give you access to competitive business loans from over 70 lenders. Loans between $5,000 and $1 million are available. Request a call – your loan can be funded in 1 business day.
Moula Business Loan
1 to 2 years
2% Establishment fee
A loan of up to $250,000 that can be approved and funded within 24 hours. Available to businesses with 6+ months operating history and $5,000+ monthly sales.
Max Funding Unsecured Business Loan
1 month to 1 year
$0 application fee
An unsecured business loan from $3,000 that offers convenient pre-approval and no early repayment fees.
OnDeck Business Loans
6 months to 2 years
3% of loan amount
Apply for up to $250,000 and receive your approved funds in one business day. Minimum annual turnover of $100,000 and 1 year of trading history required.
Heritage Bank Equipment Loan
Up to 5 years
This business loan is designed to buy new or used equipment and has borrowing amounts between $20,000 and $500,000. No monthly fees and the loan is secured against the assets purchased.
NAB Business Recovery Loan
Up to 10 years
No approval or administrative fees
An Australian government backed loan with competitive rates to assist businesses after lockdowns. Borrow up to $5,000,000. Variable rates from 4.5% p.a. up to 3.95% p.a.
Prospa Business Loan
3 months to 3 years
3% origination fee
Small business loans are available from $5,000 - $500,000 on terms of up to 3 years. At least six months trading history and a monthly turnover from $5,000 is necessary. Note: Loans approved by 30 June 2022 are eligible for no repayments for the first 8 weeks of their term.
Octet Trade Finance
1 month to 2 years
Transaction fee 2.5%
Access a line of credit to pay suppliers in over 65 countries. Borrow from $100,000 up to $12,000,000.
CommBank SME Restarter Loan
Up to 10 years
No approval or administrative fees
This loan only applies to businesses eligible under the SME Recovery Loan Scheme. Borrow up to $5,000,000 with a special, low rate loan supported by the Australian government to help businesses recover from lockdowns. Variable rates range from 2.6% p.a. to 3.75% p.a.
Earlypay Equipment Finance
2 to 5 years
$750 - Establishment fee
Upgrade or expand your business's equipment with equipment finance from Earlypay. Borrow from $20,000 to $1,500,000.

Compare up to 4 providers

Loans for PayPal merchants

If you use PayPal to process transactions in your ecommerce store, you're in luck. PayPal offers a working capital loan whereby you can borrow up to 25% of your sales from the last 12 months, up to $97,000. You then choose a percentage of your sales to make as repayments plus a fixed fee. If you're approved, you will receive the money in your account and the repayments are automatically deducted from your PayPal sales.

How do I compare options for ecommerce business loans?

There are a few things to keep in mind when finding the right ecommerce business loan for you:

  • Repayment amount. Consider the interest rate and fees to see how much your ongoing repayments will be. Look at this in terms of your past sales and see if these will be affordable.
  • Repayment flexibility. Are the repayments flexible? Are you able to repay the loan ahead of schedule or change your repayment amounts?
  • Loan amount. Make sure you are able to borrow as much as you need – no more, no less. There is no need to take out additional funds that may make the loan unaffordable or to end up with a loan that is insufficient for your needs.
  • Loan type. Is the loan you're opting for a line of credit or a term loan and will it suit your needs?

What do I need to apply?

The documents you'll need vary depending on the lender and loan you're applying for, but you'll likely need to provide the following:

  • Your business's financial records including monthly revenue and expenses
  • You may need to attach your business accounting software as part of the application
  • Your personal information including contact details and business ownership verification

Four tips for running a successful ecommerce business

  • Use multiple social media platforms. Don't just rely on reaching your customers through Facebook. Each platform comes with its own strengths and weaknesses, and using more than one could cover your bases.
  • Be mobile-friendly. Shopping on a computer is becoming a thing of the past. Not only should your site be responsive, but your content should fit mobile reading too.
  • Simplify, simplify, simplify. The last thing you want is for frustrated customers to give up while trying to buy your products. Make it as easy as possible for them to spend money on your site.
  • Reward loyalty. Developing a loyalty program is a tried-and-true way of getting customers to come back.
Loan sorted? Learn about your insurance options.

Are there other ways to fund my ecommerce business?

Yes. Business loans are a common way to finance ecommerce businesses, but they aren't your only option. Here are some alternatives:

  • Investors. Get funding in exchange for ownership of a percentage of your business from venture capitalists, angel investors or investment corporations.
  • Crowdfunding. Set up a page on a crowdfunding campaign to collect donations from your social circle and fans of your business.
  • Friends or family. You probably won't have to pay interest or fees when borrowing money from a wealthy acquaintance or relative — but you risk serious social consequences if you can't pay them back.
  • Personal loans. Consider taking out a personal loan to fund minor business expenses. This could be an option to consider for a business that doesn't meet the age or revenue requirements for a business loan.

Compare business loans now

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