Shopify: From Storefront to Financial Powerhouse

I know what you are thinking. “Isn’t Shopify a platform for e-commerce stores??” Well, you are right in that case.

Shopify's been killing it as the go-to platform for building online stores. But guess what? They're not stopping there.

Recent advances in the fintech space have made it easier for companies to embed financial services for their customers, and partnerships with fintechs have made it easier for platforms to expand their offerings.

For instance, in 2016, Shopify launched Shopify Capital, which helps merchants gain access to working capital. In 2022, it introduced Shopify Balance, which is aimed at helping merchants manage their money. It also offers loan facilities in 2023.

In the same year of 2023, Shopify teamed up with Israeli B2B payments startup Melio to launch a new bill-pay tool designed to allow U.S.-based merchant customers to manage their expenses and vendors via its platform, as well as Shopify Credit, a business credit card designed exclusively for its merchants.

The new product launched in 2023, marks Shopify’s first pay-in-full business credit card, said Shopify President Harley Finkelstein. It is powered by Stripe and it is issued by Celtic bank,

So how does Shopify evaluate how credit-worthy a merchant is?

Instead of a credit check, they evaluate sales performance, and a Know Your Customer (KYC) is required. In addition, the merchant has to be US-based with sales on Shopify and use Shopify Payments.

Once the merchant is approved, they can start spending immediately with a virtual card and earn 3% cash back on their “top spend category” and 1% on remaining categories such as wholesale, marketing, and shipping.

So, what's next for Shopify? They're constantly on the move, so it's anyone's guess. One thing's for sure: Shopify's got your back when it comes to building your business, and its what appears to be a pivot into being a fintech is really intriguing. Stay tuned to see what exciting tools they unveil next!