eBay helps Square access business loan customers
Last year, Square (SQ) secured a contract to lend money to eBay sellers, thereby expanding the market opportunity for its loans business. Given this arrangement, progress at eBay that can help bring more sellers to the platform bodes well for Square because the company will have a larger pool of potential business borrowers.
eBay (EBAY) has been recording some important wins recently. The online marketplace operator added almost 10 million new active shoppers on its marketplace during the one-year period that ended in March 2019 to finish the first quarter with 180 million active shoppers on its platform. With more shoppers, eBay stands a better chance of attracting more sellers to its platforms, which would, in turn, expand the lending opportunity for Square.
Square extended over $500 million in loans in the first quarter
Besides its having added millions of active shoppers in the span of one year, eBay also remains the top alternative marketplace for Amazon (AMZN) sellers. eBay hosts 56% of Amazon sellers, according to data from Feedvisor. It’s placed ahead of Walmart, which hosts 49% of Amazon sellers, and Shopify (SHOP), which hosts 19% of Amazon sellers. Sears (SHLDQ) hosts 8.0% of Amazon sellers.
As the top alternative marketplace for Amazon sellers, eBay provides an important platform for Square to try to take loan customers from Amazon, which also makes small loans to sellers.
Square dished out $508 million in loans to 70,000 small businesses in the first quarter.