Every business needs funds to grow, and working capital is the way to achieve it. PayPal Working Capital can be the answer if you want a quick fund. You may have heard about it often or even plan to use it again. But what if PayPal working capital denied second loan?
This article will discuss what you should do when your second working capital is denied. Let’s see!
What is PayPal Working Capital?
Before we talk more about PayPal working capital denied second loan, you should know what it is PayPal’s Working Capital.
PayPal is a very well-known virtual account service provider, and 83% of world e-commerce accepts PayPal as a means of payment. This virtual account also provides overseas transfer services at low fees.
PayPal also expanded into other financial fields and realized how much business people needed an injection of funds to grow their business. Any large-scale business needs extra money to improve the business performance and gain more profit.
A working capital loan is given to meet operating capital needs that run out in one business cycle or unique working capital needs such as to finance inventory, receivables, projects, or other special needs.
PayPal Working Capital Loan is one of the most popular working capital loan designed by PayPal for people with a business who need a loan but doesn’t want a credit check or a long waiting period.
In addition, PayPal working capital loans are provided based on your sales transactions using PayPal. They will provide various loan options and repayment percentages to pay off the loan if you qualify. Your sales volume will affect the amount you can borrow and will be charged.
You’ll pay one fixed fee, not an interest rate, because a percentage of each sale will automatically be used to pay back the loan. The higher the payout percentage you choose, the less you earn from PayPal.
Your income from PayPal will be automatically deducted until the loan is paid off. However, you can save money by choosing a higher payout percentage, as PayPal will charge you a smaller flat fee.
This also means your payout amounts scale according to your sales volume. But even if your sales volume is low, you still have to make a minimum payment of 5% to 10% of the loan every 90 days. Still, you also have the option to pay off the loan early without penalty fees.
Reasons Your Paypal Working Capital Denied Second Loan
Several conditions must be met to get a loan from PayPal Working Capital. Check the requirements below!
- Have a PayPal business account for three months or more
- Your business must be registered and verified by authorities in the UK
- Must have eligible sales via PayPal and amount to 9000 Euros per year.
- You have to pay Working Capital’s PayPal debt previously
- Loan applications must use your business name or the name of a single individual or not a joint account that operates a PayPal account
- All requirements must be met at least five days before you apply
Moreover, there are many reasons why your working capital application is rejected, one of which is because you need to meet the requirements above.
However, there are also conditions where the first loan application is successful but fails a second time. Thus, you must be prepared because several reasons lead to PayPal working capital denied second loan, including:
1. You Have Not Paid Off the First Working Capital Loan
This is different from loans in banking, which can be extended by cutting off the latest loan to pay off the old loan. On PayPal, you must ultimately repay the entire loan to apply again.
Even though you have paid it off, it will still take several working days to apply for working capital again. So, you cannot use it for working capital on the same day as the previous loan payoff.
2. Your Sales are Decreasing
PayPal applies a minimum amount of sales from your account, 9000 Euros per year. There is a decline in sales in your business, so PayPal rejects your second loan.
3. Incomplete Documents
Even though this is your second loan application, you may need to correct mistakes and provide complete documents when applying for a loan. This also causes your loan to be rejected by PayPal.
4. Business Reputation
PayPal may not check your credit score for this loan application, but they also look at your business reputation. If your business is involved in a crime or crime, PayPal may reject your loan application for security and risk reasons.
5. Economic Conditions
Economic conditions also affect the possibility of PayPal providing its loans. For example, during a pandemic or war, PayPal or other finance companies will tighten their loan selection. This aims to minimize risks that will occur in the future.
Things You Should Do When PayPal Working Capital Denied Second Loan
You should do some things when PayPal Working Capital denied second loan.
1. Pay Off Your First Working Capital
The first step you can take to overcome the PayPal working capital denied second loan is to pay all the loans you took out previously. Check everything, especially the budget, so that you can complete the payment. Ensure you get the payment due date so your second loan is approved.
2. Wait a Few Days Before Applying for a Second Loan
Sometimes, a program requires time to run smoothly. Therefore, please wait a few days before you reapply the working capital. PayPal may take several business days to confirm your payment. Wait at least five working days before applying for the second working capital.
3. Make Sure All Documents are Complete
Even though you have already applied for a loan, you may need to provide complete documents. Moreover, the system at PayPal is constantly undergoing improvements, so you may give incomplete records. Recheck your documents and make sure all your documents are complete.
If you still experienced PayPal working capital denied second loan, the last resort is to contact the call center to ask about the problem.
Get Ready To Get Your Second Loan
So, that’s all about the problems and answer to the question of PayPal working capital denied second loan and how to fix it. If you are still confused, contact the call center or visit the PayPal website for complete information. Customer service will gladly help with your issues so that you can get your loan smoothly.
