Amazon Business Line of Credit: Is It Right For You?
Finding the right financing for your business can be difficult. With so many options to choose from, how do you know which one is right for you? For businesses that regularly shop online, Amazon’s Business Line of Credit is a simple and effective financing option. Read on to learn more about the features of Amazon Business Lines of Credit and how to decide if it’s right for you.
What is an Amazon Business Line of Credit?
Amazon Business Line of Credit is a financing option for businesses that buy from Amazon Business or Amazon.com. Managed by Synchrony Bank, this line of credit allows businesses to easily manage their stocks and track their purchases.
When you sign up for an Amazon commercial line of credit, you have a dedicated account management team to help you set up, customize, and manage your line of credit. Businesses that spend more than $ 100,000 per year will also get an account specialist assigned specifically to their account.
Once your account is set up, you can create separate accounts for each of the companies, locations, or departments in your organization. Then you will receive easy-to-read monthly statements that list your detailed transactions and product-level details for each invoice.
Amazon’s Line of Credit is an interest-free, annual fee-free, full payment line of credit. You will enjoy 55-day payment terms on all Amazon Business purchases, with the obligation to fully repay the line of credit at each payment term.
It’s important to note that there are some items that you cannot purchase with an Amazon Business Line of Credit, including:
- Mobile phones
- Rental of manuals
- Electronic documents
- Games and software downloads
- Digital newspaper and magazine subscriptions
- Main subscriptions
- Recurring deliveries and Subscribe and save
- Amazon gift cards by email or print at home
What are the pros and cons of an Amazon Business line of credit?
Before signing up for an Amazon Business Line of Credit, you should understand all the pros and cons that come with it.
- No interest or annual fees: There is no annual fee for using an Amazon commercial line of credit, and because you pay your bill in full each time, there is no interest.
- Payment terms over one month: Although Amazon’s line of credit has a full payment requirement, the payment terms are 55 days instead of a standard month.
- Dedicated account management team: When you sign up for an Amazon commercial line of credit, you get a dedicated account management team to help you set up and manage your account.
- Only works for Amazon purchases: Amazon’s line of credit can only be used for Amazon Business or Amazon.com purchases. Since most businesses don’t 100% of their purchases from Amazon, this is impractical.
- Cannot be used for all products on Amazon: While the Amazon credit line can be used for most Amazon purchases, there are several exceptions listed above.
- No reward: Unlike business credit cards, Amazon’s business line of credit does not offer you any cash back or other rewards for your purchases.
Amazon Business Line of Credit Costs
Amazon currently only offers full payment lines of credit. As a result, you don’t have to worry about paying interest on your purchases. There is also no annual fee for using your line of credit. You may be charged certain fees. There is a charge of 2% per month or an annualized rate of 24% for late payments.
There is also a returned check fee of $ 29.
Amazon Business Line of Credit Ratings
The Amazon Business Line of Credit has mostly positive reviews. With around 250 reviews in total, it has an average rating of 4.1 out of 5 stars. The positive reviews were pleased with the ease with which the line of credit facilitated ordering for their organizations.
Negative reviews mainly point to outdated technology and a difficult system to use.
Who is an Amazon Business line of credit for?
Now that you know the Amazon Business Line of Credit, you might be wondering if it’s right for your organization.
There are a few types of businesses that are best suited for these lines of credit:
- Established companies: Synchrony Bank, the financial institution that manages Amazon’s lines of credit, requires applicant organizations that have been in business for more than two years. If you’ve been in business for less than two years or don’t have a credit history, you’ll need to provide a personal guarantee, which means you’ll cover the bill if the business can’t.
- Companies that frequently buy from Amazon: This line of credit can only be used for purchases on Amazon Business or Amazon.com. As a result, you won’t really get the best out of line of credit unless you shop on Amazon often.
- Companies that can pay their invoice in full: Amazon’s commercial line of credit is currently only available with full payment terms (more specifically, they have 55 day payment terms). If you need more time to pay for your purchases, you might be better off looking at a credit card.
How do I apply for an Amazon Business line of credit?
To apply for an Amazon Business Line of Credit, visit the Line of Credit page on the Amazon website and click “Apply Now.” You can find out more about the line of credit and when you are ready to apply you will be redirected to the application form with Synchrony Bank.
To apply, you will need to provide the following information:
- Company Name
- Business address, telephone number and e-mail address
- Type of company
- Annual revenue
- Tax Identification Number
- Authorized representative or owner information
When you fill out the form, you will be given the opportunity to provide a personal guarantee. Personal guarantee is optional, but it may be required if your business has been in existence for less than two years or has no established credit history.
Who Should Apply for an Amazon Business Line of Credit?
The Amazon Business Line of Credit is best for established businesses with at least two years of credit history that regularly buy from Amazon.
What is the difference between an Amazon business line of credit and an Amazon business credit card?
Amazon Business Line of Credit can only be used on Amazon and must be paid in full every 55 days. Amazon’s business credit card does not have a full payment requirement and can be used at most retailers.
The credit card also comes with cash back rewards.
Are There Alternatives to an Amazon Business Line of Credit?
The Amazon Business Line of Credit can be a great option for businesses to simplify their Amazon purchases, but it’s not the only option.
Here are some alternatives you might consider:
- Amazon Business Prime American Express Card: For businesses that shop regularly from Amazon, a line of credit isn’t the only option. Amazon also offers a business credit card, which gives you cash back on most purchases, which you can then use to make purchases on Amazon. Unlike with a line of credit, your credit card bill doesn’t have to be paid in full every time (although you will pay interest on unpaid expenses).
- BlueVine Business credit line: BlueVIne is a popular provider of lines of credit for small businesses, with amounts ranging from $ 5,000 to $ 250,000. BlueVines lines of credit have a few advantages over those from Amazon. First, you can repay the amount you borrowed over 6 to 12 months. This is more generous than Amazon’s full payment requirement. The money can also be used for any purpose, unlike Amazon’s line of credit, which can only be spent on Amazon purchases.
The bottom line
The Amazon Business Line of Credit can be a great option for businesses that shop regularly from Amazon and want to organize those purchases with easy-to-read monthly statements. That being said, given the short payment terms and the fact that your line of credit can only be used on Amazon, most businesses will likely find that an Amazon credit card or a more flexible line of credit works best for them. .