eBay is launching a new financial services tool — Capital for eBay Business Sellers (CEBS) — that will extend loans to the small businesses selling on its platform in the U.K., Financial Times reported.
“We think this is a field ripe for innovation and there’s a lot of unmet demand for better service for online businesses,” eBay U.K. general manager Murray Lambell told FT. “We think eBay is well-positioned to deal with this.”
The online marketplace is partnering with YouLend to offer the 300,000 sellers on its platform in the U.K. access to capital. The CEBS initiative will offer loans ranging from £500 to £1 million. The move positions eBay as a competitor to its former subsidiary PayPal as well to banks and other financial institutions offering business loans.
Lambell added that eBay is also looking into more loan options for larger businesses, and plans to collaborate with specialists rather than create an in-house credit department, according to FT.
“We can partner with companies that offer solutions, and what we can give them is unrivaled access to data and information which helps them get the best loans,” Lambell said.
Bankers at legacy institutions will be watching the CEBS program as they continue to measure the impact that technology companies could have on their balance sheets. eBay’s $41 billion market capitalization is roughly 50 percent higher than the U.K.’s biggest small business lender NatWest, according to the news outlet.
Amazon has been extending loans to the small businesses selling on its marketplace for about 10 years, but the program’s popularity has waned over the passing years,
In a June 2020 PYMNTS interview, Keala Gaines, eBay’s head of global payments services, said that the platform’s strategy regarding payments has been evolving over the years as the company has grown. eBay is available in 100 countries and has 27 international sites.