Shopify Capital loans and repayment for Australian merchants
Shopify Capital offers loans to merchants in Australia. Shopify Capital provides these loans as a lump sum of money called the loan amount in exchange for a fixed borrowing cost, which is specified as your cost of funds in your loan agreement.
You repay this total payment amount, which covers the loan amount and borrowing cost, through a daily payment percentage based on your daily sales. The repayment continues until the total payment amount is completely paid off, but you must pay off the total payment amount within a maximum term of 18 months. You are also required to meet 2 minimum payments within the first two 6 month periods. If your sales don't meet the minimum payment, then you may be required to make a manual payment to meet your minimum. The actual duration that you take to pay back your loan may be less than 18 months based on your sales. The specific terms, such as the total payment amount and daily payment percentage, are determined based on your risk profile.
On this page
Apply for a Shopify Capital loan (Australia)
Eligible merchants in Australia can request a loan and access funding options on the Finance page of your Shopify admin. Funding isn't guaranteed, and an offer to apply might expire without notice or the funding amount may change.
There are usually 3 funding options available, each with its own terms that can differ based on factors such as the loan amount, the total payment amount, and the daily repayment percentage.
After you apply for a loan, your application for funding is usually reviewed within 1-3 business days, although it might take longer in some cases. If your application is approved, then the loan amount is deposited into your business bank account. Following the loan disbursement, a daily repayment percentage based on your store's daily sales will be applied starting within 2 business days after the loan disbursement.
Steps:
From your Shopify admin, click Finance.
In the Accounts section, click Capital.
Review the terms of the available funding options, and then click Apply now under the option that you want to apply to.
Verify your identity and business details for Shopify Capital.
In the Review loan terms and submit your application dialog, click Merchant Loan Agreement, and then review the terms of the agreement carefully before submitting your application.
Select Change my payments provider to Shopify Payments, to change your payment provider to Shopify Payments.
Click Submit application. You might be asked to verify your details for Shopify Capital, even if you have previously received funding through Shopify Capital.
After you receive the loan, the daily repayment based on your store's daily sales begins within 2 business days.
Requesting another Shopify Capital loan (Australia)
You may qualify for a second loan before you have repaid an existing loan in full. If you're eligible for a second loan, then new funding options are displayed on the Finance page in your Shopify admin.
View your loan payment details (Australia)
After you receive your loan, you can track the remaining balance of your total payment amount from the Finance page of your Shopify admin under Accounts.
From the Capital page, you can view the following repayment information:
- The current balance of the total payment amount.
- The amount of the total payment amount that has been repaid.
- Payment transaction history.
In the All transactions report, the Total sales column displays each day's sales revenue, and the Amount column displays how much of that revenue is repaid to Shopify Capital.
Download your balance letter
You can download a balance letter from the Finance page of your Shopify admin. You can use the balance letter to show your bank that you no longer have any financial obligation or what your current balance is.
Steps:
From your Shopify admin, click Finance.
In the Accounts section, click Capital.
Click View all transactions.
Click Export, and then click Balance letter.
Save the balance letter to your device.
Repay the balance of your loan (Australia)
You have the option to manually pay back any amount over $1 AUD towards your loan or clear up to the entire outstanding balance at once. The payment is deducted (debited) from the same business bank account linked to your Shopify Payments account.
Steps:
From your Shopify admin, click Finance.
In the Accounts section, click Capital.
Click Make a payment.
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Choose the amount that you want to pay:
- To make a manual payment, enter the amount in the Custom amount field.
- To pay the full amount, click Full remaining balance.
Click Next step, and then review the amount to be repaid.
Click Make a payment.
You receive a confirmation email when your repayment is complete.
Calculating your loan repayment
Your daily payment to Shopify Capital is calculated by multiplying the daily repayment percentage by your store's daily sales revenue. No payment is taken on days when there are no sales.
Daily sales revenue is calculated using the final total transaction amount for each day, which includes all charges such as shipping and handling, as well as any applicable taxes such as duty and value-added taxes. This calculation includes all orders marked as paid on that day, regardless of the order source, the payment processing method used, or whether the order was later refunded or canceled. The only orders not included in the calculation are test orders placed when Shopify Payments was in test mode. If an order was placed without test mode activated, then it will be included in your store's sales revenue for the day's repayment calculation.
Minimum payments (Australia)
New Shopify Capital loans will include 2 minimum payment thresholds. These changes are outlined in the Capital loan agreement terms. Shopify Capital will review your progress at the 6-month and 12-month marks within the loan term to determine if you meet these minimum payment thresholds. These evaluations are important to help ensure that you're making progress towards paying your loan.
The minimum repayments are 30% of the total loan by the 6-month mark and 60% of the total payment amount by the 12-month mark. These payments are calculated based on a percentage of your daily sales, known as the daily payment percentage. These minimum payments are in place to help you stay on track with your loan repayment.
If you fail to meet the minimum payment threshold during these evaluation points, then it may result in an event of default under your loan agreement. Refer to your loan agreement for more details on the actions that may be taken if you miss your minimum payments and an event of defaults.
Loan repayment time frame (Australia)
The maximum term for new Shopify Capital loans is 18 months, within which the total payment amount must be fully received. Shopify Capital loans are designed with a repayment structure based on a percentage of your daily sales, meaning that the actual duration needed to repay the loan could be less than 18 months.
If your sales slow down so that you aren't on track to meet the maximum term of 18 months, then you could be in default under your loan agreement. Therefore, it's essential to monitor your loan payment balance and make a manual payment to avoid defaulting on your agreement.
Failed Shopify Capital payments (Australia)
If your debit payments are paused or fail, then you may be in default of your loan agreement. In the event that your Shopify Capital repayment fails for the day, there are a few options available to address the situation:
- Automatic repayment: If the debited loan repayment fails, then Shopify will not attempt to debit the payment again. However, your next day's loan repayment, based on the daily repayment rate calculated from your store's daily sales revenue, will continue to be debited as usual.
- Manual payment: Alternatively, you have the option to make a manual payment to cover the repayment failure. This allows you to proactively address the missed payment and ensure your loan repayment remains on track.