Please ensure Javascript is enabled for purposes of website accessibility

Shopify Offers Cash Advances to Canadian Merchants

By James Brumley – Updated Apr 20, 2020 at 8:27PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The e-commerce platform is offering help in an environment where much is needed, solidifying its position as a business partner.

As the coronavirus contagion has forced the shutdown of countless small businesses all over the world, many now find themselves hungry for cash.  Now e-commerce service provider Shopify (SHOP -1.49%) is throwing out a much-needed lifeline to some of its Canadian users.

Shopify Capital, previously available to U.S. and U.K. customers, will aim to help Canadian merchants using its platform by offering cash advances ranging from CA$200 to CA$500,000, depending on the need and each company's fiscal history.

Man handling another man several hundred dollars in cash.

Image source: Getty Images.

The Canada-based company allows small businesses to build their own e-commerce engines, sidestepping other online-selling venues that may be too costly for sole proprietors or other micro-businesses. The company facilitated more than $60 billion in online sales last year, translating into nearly $1.6 billion worth of revenue for itself.

Its intimate link with the 1 million businesses it powers leaves it well positioned to provide the short-term funding many of them need now, though not all of them will be able to plug into Shopify Capital's resources. Merchants must still apply for what is essentially a loan and repay it from sales made using the company's e-commerce tools. 

Shopify shares surged more than 6% on Monday, perhaps driven in part by investors who believe serving small businesses in this way will improve its share of the e-commerce market.

James Brumley has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Shopify. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Shopify Stock Quote
$30.37 (-1.49%) $0.46

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/06/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.