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  • Writer's pictureAccrueMe Team

The Danger of FBA Loans For Amazon Sellers

The Danger of FBA Loans For Amazon Sellers
The Danger of FBA Loans For Amazon Sellers

Many Amazon Sellers rely on FBA Loans or alternative financing for Amazon Sellers to fund the growth of their business. While financing has helped many Amazon Sellers take their businesses to the next level, FBA Loans can also destroy an Amazon Business when a Seller doesn't fully understand the economics of these loans.

Warren Buffett famously said; "When you combine ignorance and leverage, you get some pretty interesting results."

Typically, most financing for Amazon Sellers is referred to as an Amazon Loan or an FBA Loan but many of the financing options for Amazon Sellers are, in fact, not loans at all.

Instead, many "FBA Loans" are fintech versions of sophisticated business financing products like receivables factoring, revenue purchase agreements, personal guaranteed credit lines, royalty deals, cash advances, and more.

One of the only true loans available to Amazon Sellers would be something like a term loan from Amazon Lending which still typically come with uncommon terms when compared to a traditional loan.

Typically, Amazon Sellers are looking for financing to overcome some sort of cash flow issue. Usually something like;

  • More Cash for Inventory

  • Launch of A New Product

  • Cover Bills Due To Amazon's 2 Week Pay Outs

  • Bridge Ongoing Business Losses

All of these reasons come down to sellers needing more cash in their business every month than they have coming in from sales.

Because almost all Amazon Sellers are looking to use FBA Loans to overcome a cash-flow challenge, they should be looking at financing options with the smallest impact on their business cash flow.

Unfortunately, most FBA Loans and financing for Amazon Sellers are designed to limit investor risk by maximizing repayments.

For example, an Amazon Loan for $100k might have a 3 Month term requiring the seller that borrows $100k on day 1 to pay $35k on day 30, $35k on day 60, and $35k on day 90. A seller borrowing $100k to solve a cash-flow problem doesn't have $35k in extra monthly cash flow for loan payments! The cash-flow demand is even more intense with factoring or revenue-based loans in most cases.

So, how do Sellers make these high FBA Loan payments?

Well, they borrow more money to keep up resulting in more debt and higher fees which puts a seller in a constant cycle of borrowing to cover cash flow.

AccrueMe has zero repayment requirements (many Amazon Sellers go months or even years without paying AccrueMe a penny).

If you are trying to solve a cash flow problem, you need an investor that will help your cash flow and not be a drain on cash flow.

AccrueMe was invented to be the opposite of FBA Loans. Because, unlike traditional FBA Loans, AccrueMe portfolio companies truly solve their cash flow problems and focus all of their resources on growth.

You can learn more at

About AccrueMe®

AccrueMe provides success-based financing for Amazon Sellers. With decades of experience in lending, AccrueMe's leaders have created a completely new way of providing capital, powered by a proprietary portal built around leading-edge eCommerce technology. With unprecedented line of sight into business data, AccrueMe’s portal simplifies financing for online retailers in a way that was never before possible: based entirely on sellers' success, and repaid when best for the seller, and not based upon a pre-determined schedule. Ecommerce retailers have built their businesses on the latest technology, we believe they deserve financing from a partner that's powered the same way. AccrueMe: cutting edge capital for eCommerce. Learn more at



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