Working Capital
Editorial Team
At Working Capital, we believe access to funding should be simple, transparent, and designed around your business not the other way around. We’re committed to helping entrepreneurs make smart financial decisions with tools, guidance, and lending partners they can trust.
Business opportunities come in all shapes and sizes. One month, you need fast funding to stock up on inventory before a sales rush or cover expenses while waiting for customer payments. The next you might be investing in a major expansion or commercial property you will use for decades.
Each of these opportunities has different financial demands. So choosing the right option comes down to the product and lender that best supports your business as you meet those demands.
PayPal and Lendistry both provide funding for small businesses, but they do it with completely different opportunities in mind. One focuses on helping merchants manage short-term cash flow needs through streamlined access to fast working capital loans. The other supports long-term growth in underserved communities with government-backed capital.
By comparing the two lenders’ financing products, qualification requirements, funding amounts, and repayment terms, you can discover which of the two is the better option for your business and current opportunities.
Lendistry offers a non-revolving line of credit (LOC) ranging from $25,000 to $3 million.7 This means that the available credit limit is fixed at the original approved amount for the draw period, and repaid funds do not become available to draw again. Lendistry offers a draw period of up to two years and a repayment period of up to five years, with fixed monthly payments.7
To qualify for this LOC, businesses must show a minimum of two years in business and a minimum credit score of 640. Lendistry also requires three years of bank statements, three years of personal and business tax returns, a custodial account, and a personal guarantee.7
Lendistry offers competitive interest rates as a business line-of-credit lender. They charge variable interest, tied to the WSJ Prime Rate on the amount withdrawn from the nonrevolving LOC. Prepayment penalties apply only during the first two years.7
The ability to draw funds over time, rather than receiving a one-time infusion of capital, can be valuable to established businesses. It gives them the capital and flexibility they need for large investments or predictable needs.
Lendistry is authorized to directly approve and fund SBA 7(a) loans without routing applications through the Small Business Administration (SBA) because it is an SBA Preferred Lender.6 This status allows lenders to accelerate the funding timeline. Qualified businesses can secure an SBA 7(a) Working Capital loan in as little as five days and a General Purpose loan under $350,000 in as little as five days when they go through Lendistry.8
To qualify for an SBA 7(a) General Purpose, businesses need a minimum 620 credit score and more than two years in business.8 For SBA 7(a) Working Capital loans, owners need a credit score of at least 680 and a credit score of at least 640 for SBA 7(a) Commercial Real Estate loans.7 Lendistry also requires comprehensive documentation for each of these loans.9
Lendistry offers between $25,000 and $500,000 for an SBA 7(a) Working Capital loan, and between $10,000 and $5 million for other SBA 7(a) products. Borrowers make fixed monthly payments for the life of the loan, which can reach up to 25 years for commercial real estate loans and up to 10 years for other SBA 7(a) loans.7
Lendistry charges variable interest on all its government-backed and commercial real estate loans. Depending on the funding amount and product, they offer rates as low as WSJ Prime + 2% to strong borrowers.7 Prepayment penalties start at 5% in the first year and decreases by 1% each year, depending on the loan product.7
As an SBA Preferred Lender, Lendistry can often provide small businesses with access to more capital, longer terms, lower costs, and faster timelines than many loan companies. Qualified businesses with the time to apply and wait for funding, especially those needing financing for business equipment or commercial real estate, can benefit greatly from Lendistry’s government-backed loans.
Lendistry works with government agencies and private organizations to support small businesses in underserved communities. Third-party partners manage the grant programs and financial education resources, while Lendistry serves as a hub for applications, customer service, and financing.10
Lendistry also offers fast small business lending programs to help businesses in underserved industries achieve their goals. For example, retail shops pursuing an airport concession contract can secure a long-term loan through Lendistry structured to their specific goal.10
By pairing loan access with grant administration, financial education, and special lending programs, Lendistry maintains a community-oriented dimension that sets it apart from most business term loan providers.
PayPal offers a merchant cash advance (MCA) through its working capital program. Merchants with a PayPal Business or Premier account can qualify for an advance based on their annual sales through the platform. No credit checks or collateral required with an application. Then, borrowers repay a daily percentage of their PayPal sales.2
To qualify for PayPal Working Capital, businesses need more than 90 days of sales history on the platform, and at least $15,000 in annual sales on a Business account or $20,000 on a Premier account.2 Repeat borrowers also must pay off their previous advance before they can qualify for additional financing.
Focusing on revenue within its own ecosystem allows PayPal to transfer funds faster than most MCA companies. Qualified businesses can apply and see capital deposited to their PayPal account within a few minutes.2 PayPal offers first-time borrowers between $1,000 and $200,000 advances, and extends offers up to $300,000 for repeat clients.
PayPal Working Capital comes with a single flat fee, included in the repayment percentage deducted from the borrower’s daily PayPal sales.4 Businesses don’t have a set repayment term, but they must repay 5-10% of the total balance every 90 days or repay the advance in full. PayPal does not charge prepayment penalties or late fees.2
For PayPal users who need lightning-fast funding or revenue-based financing, PayPal Working Capital offers flexible repayments, transparent pricing, and quick access to funds.
Lendistry focuses on long-term small business loans for underserved communities. It does not offer merchant cash advances or revenue-based loans.7 Businesses looking for short-term funding with flexible repayment schedules will need to look elsewhere.
Merchants with existing PayPal Business accounts can apply for a PayPal Business Debit Mastercard®. This product links to the cardholder’s account balance rather than extending credit, giving businesses instant access to their PayPal funds.5
PayPal requires only basic business information and a PayPal account in good standing to review an application.1 The provider sends approved businesses a digital card within minutes, which immediately provides access to funds.5 They then mail a physical card, which typically arrives within 10 business days. Businesses must confirm a physical address before they can qualify for a PayPal Business Debit Mastercard.1
Using this debit card can simplify business spending for PayPal merchants. Cardholders can secure up to four employee cards, and the platform allows owners to set spending limits, freeze and unfreeze cards, protect their purchases, and track expenses in one place.5
A PayPal Business Debit Mastercard also earns rewards for business owners. PayPal provides 1% cashback on qualifying purchases, and Mastercard Easy SavingsTM offers rebates at over 50,000 businesses when merchants shop with their debit card.5 Rewards funds are automatically added to the cardholder’s account balance within a week of when the transactions settle.
The PayPal Debit Mastercard works for merchants who need to manage their team’s spending, access their account funds, and earn cashback on their purchases.
The PayPal Business Loan gives platform users access to short-term financing with fixed repayment schedules.3 To qualify, merchants must have at least nine months of operating history, more than $33,300 in annual revenue, and an active PayPal Business account.3
PayPal uses different approval criteria for its Business Loan than for PayPal Working Capital. Rather than looking only at PayPal sales history, it also considers total business revenue and may request bank transaction history during the application process.3 Applications typically take just a few minutes to complete.
Applying for a PayPal Business Loan does not impact your credit. But upon accepting an offer, its partner WebBank conducts a personal and business credit check.3 PayPal does not require any kind of collateral.
First-time borrowers approved for PayPal Business Loans can choose from 17-week to 52-week terms and receive up to $200,000.3 PayPal can fund up to $300,000 for repeat clients. Borrowers repay all business short-term loans in fixed weekly amounts, automatically deducted from their business account.3 PayPal uses the same flat-fee model for all their financing products, and does not charge any late or early payoff fees.
For PayPal merchants who prefer predictable payments or businesses that generate most of their revenue outside PayPal, a PayPal Business Loan can provide necessary short-term working capital.
Lendistry offers traditional term loans with fixed monthly installments over periods of one to five years. The application requires comprehensive documentation for the last three years and a personal guarantee, but other funding requirements and timelines vary depending on the amount of capital the borrowers need.8
Businesses with credit scores higher than 640 and year-over-year revenue growth can secure as much as $5 million in as little as five days. Interest rates on these longer-term loans track the WSJ Prime Rate and typically land in the low double digits.7
Borrowers can secure between $10,000 and $350,000 in as little as three days and with a credit score as low as 620. These small-business capital loans come with fixed interest rates as low as 11.99%.8 Lendistry issues a prepayment penalty of 1-5% over the course of the term loans, regardless of the amount borrowed.7
With its fast funding and medium-term length, Lendistry’s traditional term loan is the closest it offers to working capital funding. But it falls short of the simple applications and fast funding featured by most working capital providers. Lendistry remains a better option for significant investments when businesses need lots of capital, long repayment schedules, predictable payments, and low interest rates.
As you evaluate your financing options, remember that the right lender depends on the opportunity you’re pursuing. A short-term cash flow gap doesn’t require the same solution as purchasing commercial real estate.
PayPal ranks above Lendistry when you compare working capital loan options. The fast MCA and short-term loan integrated into the PayPal ecosystem help merchants bridge everyday financial gaps and pursue small-scale opportunities.
On the other hand, Lendistry is a much better choice than PayPal for businesses planning significant investments. Its range of traditional, government-backed loans offers predictable, low-cost financing that can support larger projects and long-term growth.
When you compare information about Lendistry and PayPal with your business situation, you’ll have a clearer picture of which lender aligns with your current priorities and plans.
2https://www.paypal.com/us/business/financial-services/working-capital-loan
3https://www.paypal.com/us/business/financial-services/small-business-loan
4https://www.paypal.com/workingcapital/faq
5https://www.paypal.com/us/business/financial-services/debit-card
7https://www.lendistrypartners.com/wp-content/uploads/Lendistry-Product-Guide.pdf?utm
8https://lendistry.com/small-business-lending/
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