Earlier this week Amazon, one of the largest Internet businesses, started offering loans to its online sellers. This is something drastically different for them. Since the inception of Amazon, they have been in the business of making money, not lending money. By moving to a loan making business, they are not only offering up their large amounts of money to their clients, but they are also opening themselves up to potential credit risks. The idea is that Amazon would offer loans to their sellers which will in turn allow them to buy more inventory that can then be sold on the website. Amazon would get money from both sides because they would get interest from the loans as well as fees from the selling of the inventory of their sellers.
The new entity will be called Amazon Lending, but has not yet been officially announced. Emails went out earlier this week to potential clients telling them about the business opportunity and as word spread Amazon's stock began to rise throughout the week. An announcement is expected in the near future, but an official date has not been named yet.
Alistair Barr wrote the article "Amazon Lending: Company Offering Loans to its Online Sellers" was posted on The Huffington Post earlier this week.
No comments:
Post a Comment