Amazon offers working capital loans through its Amazon Lending program, which is popular with sellers that wish to scale their business on the marketplace.
Last week, Amazon announced that it would not accept FBA shipments in many categories as it was concentrating on primary high-demand categories due to a run on household goods from the COVID-19 emergency.
Many sellers in categories not exempted from this inbound shipment ban and especially those who have Amazon Lending loan payments, were outraged as it prohibited them from sending inventory to the company.
This would create a significant cash flow issue for many marketplace sellers with Amazon Lending loans who may not be able to cover their loan payments from the disbursement of sales proceeds.
Now sellers with Amazon Lending loan payments received a reprieve as the company notified sellers with loans that payments would be paused until May 1, 2020.
“Effective March 26 through April 30, 2020, we will be pausing repayments on your outstanding loan with Amazon Lending. Your loan will not accrue interest during this period. Loan repayments will restart on May 1, 2020. Your next loan statement will be on the same day of the month as you have now. You will have the same number of remaining payments once repayment resumes.”
The company noted it will take time to implement this change throughout its tracking systems, so sellers may still receive a loan repayment notice issued after the effective date.
Amazon said sellers should disregard the notice.
Possible Delays in Removal Orders
With the good news of a pause on loan payments comes some bad news in that Amazon has temporarily halted removal operations in some of its fulfillment centers.
The company said while it is catching up on inbound shipments of household goods, it will not send out removal orders. Removal orders are orders placed by sellers to have their products returned to them.
Amazon did not provide a date when this pause on removal orders would be lifted.
What do you think about Amazon pausing loan payments?
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