Etsy Struggles to Pay Sellers After Silicon Valley Bank Collapse
Etsy, the popular American e-commerce platform known for DIY handmade or vintage items and craft supplies, is reportedly facing difficulties in paying its sellers on time following the collapse of Silicon Valley Bank (SVB) on March 10, 2023.
Sellers on the Etsy platform have taken to social media to express their frustration and concern after payments that were due to be credited to their bank accounts on March 10, 2023, have not been credited by Etsy. The company has sent out an email to affected sellers, acknowledging the delay and stating that it is working with its other payment partners to resolve the matter as soon as possible.
However, no concrete date has been given for how long the delay will last, leaving sellers to assume that their funds earned from selling products on the website have been withheld indefinitely. This is the first major effect of the SVB bank collapse that has impacted the general American consumer market.
Sellers Express Concern and Anger on Social Media
Upon receiving the email, sellers took to social media to express their concern and anger. Some sellers even reported the Etsy payment delays to news outlets such as NBC News, claiming that the delays will have a “catastrophic effect” on their business.
NBC quotes American small business owner, Owen McKinney, who runs Kentucky Country Home laser engraving business, stating that he relies on Etsy’s deposits to pay for items like shipping costs and materials. Due to the delay, he had already reached out to one of his suppliers to delay an order for materials that he needed for next week.
Etsy’s Revenue and Net Loss in 2022
As of December 31, 2022, Etsy had over 100 million items in its marketplace, connecting 7.5 million sellers with 95.1 million buyers. In the fiscal year of 2022, Etsy garnered revenue of US$2.6 billion and registered a net loss of US$694 million, as a blitz scaled tech startup.
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