Upwork freelancer loans

[andres-munoz]

Hello dear Upwork Community,

As an Upwork freelancer, I've been looking for a loan, I understand that traditional banks might not be the best option for freelancers, so I'm reaching out to this community for advice and recommendations on where to find a suitable loan specialized in  Upwork freelancers.

Are there any financial institutions or online lenders you've had positive experiences with? Have you encountered any lenders catering to freelancers or those working with Upwork exclusively? I'm interested in learning more about the application process, interest rates, repayment terms, and other relevant information.

Thanks, and happy week, everyone who reads this! 

[bf97c28c]

Hi Andres Felipe, it's an interesting topic. For the first time Upwork gives free connects. And every month, some free conects. How do you see possabilyty of financial oportunity, your own wishes? For exemple I would like returned cobects if the proposal didnt accept.

[iwan-spillebeen]

I'm afraid your response is completely unrelated to the original poster's question, he is asking about a personal or business loan, not about UpWork connects.  Do feel free to start a seperate topic on the connect management / reimbursement if you like.

Do keep in mind, connects are income to UpWork, it is highly unlikely that they will reimburse you for unaccepted proposals.

[bf97c28c]

Iwan, thank you, for the correction and good advice about a new topic. 

[iwan-spillebeen]

I would say this depends on how you have set up as a freelancer, if you are registered in your country as self-employed and can show regular monthly income and tax payments from this you have almost as much chance as any other independent / self employed person in your country to get a loan from a bank.

As with anything, this will come down to how long you have been self employed, whether there are regular payments to your bank account, and whether those payments are of a decent average over time.  Most banks will expect to see some significant tracktion (1 year plus of steady income) and will need to see clearly what the loan is meant for (personal or business) but I wouldn't exclude this as an avenue at all.

[colettelewis]

I can tell you that no freelancer - in the sense of how most of us work here on Upwork - stand a snowball's chance in hell of getting a loan.  Loans need collateral.  Never, ever, ever go for the sort of no-questions-asked loan anywhere in the world and particularly on the internet, you would be crippled by interest rates, and failure to pay could result in being crippled by a baseball bat.  Forget loans - no one cares if you get work on Upwork or any other online job platform.  By the same token also forget dodgy cryptocurrency deals - in particular OneCoin. 

[25005175]

Loan for what? That and your recent financial history (as Iwan mentioned) are what will determine your eligibility for loans and the terms that the lenders will offer. Be cautious with big lenders and fintechs (although some socially-oriented fintechs are worth considering).

[andres-munoz]

First and foremost, I'd like to express my gratitude for all the insightful responses and suggestions I've received. As an online freelancer, I'm now considering alternative financing options since there are various methods to secure funding in our line of work. Nonetheless, I'd like to keep this discussion open and encourage further exploration of potential solutions. In particular, I think it would be fantastic if a loan program could be implemented based on Upwork's Talent Badges. This innovative approach could provide a tailored solution for freelancers, taking into account their skills, expertise, and track record on the platform. 

What do you think, guys?

[25005175]

I think it would be immensely risky for an Escrow company in the US to engage in financial lending, assuming that it is even legal.

[iwan-spillebeen]

It can be legal if they obtain the required licenses, but the question is more as to why would UpWork be interested in doing so?

A. It has nothing to do with their core business, they are a freelance marketplace, not a money lending house, companies tend to not start up business lines they are unfamiliar with or that are way outside of their business model.

B. Even if they did start a lending program, what guarantees would UpWork have that the loans will be repaid?  From what I can see, zero.  Yes in principle they could put a lock or percentage on your UpWork earnings to repay a loan but since you can leave the platform overnight that gives them zero protection.
C. The platform is international so they'd have to deal with all local laws and regulations in order to ensure that they can even potentially get their loan repayment back, with zero to no guarantees of any protection in the countries in which they aren't operational.

D. The cost of running such a model would far outweigh the benefits and potential returns as far as I can see. UpWork is currently running a virtually no payment risk operation, except for some hourly payment protection that only applies in certain cases, all other times they either get paid or don't suffer if clients don't pay (aside from lost commission).  Starting a loan business would astronomically boost their cash flow risks and would likely put them out of business in no time.

E. Supply and demand, currently the ratio of freelancers against clients is a factor of 4/1 or higher, if it was the reverse then this might make some sense as there would be a lot more freelancer loyalty and longevity, but they would still need to lock freelancers in which again is against their current business model.

[boushy-brandon]

I don't think Upwork should be the one to provide the loan, but it would be highly beneficial for Upwork to find a preferred lending partner that they would allow us to connect our account to so that they can do a loan where the payback is X percent of weekly earnings until paid off. Then it's automatically deducted before we ever have access to the money.

[iwan-spillebeen]

The only problem with it is that a freelancer isn't bound to UpWork, so even if you have a long history with UpWork and were able to take out a loan, nothing stops you from moving off the platform the very next day and they would have no recourse to deduct the money.

[2a05aa63]

payoneer is offering loans to freelancer called Capital Advance. It's pretty small but I think you can get higher amounts if you provide documents.

[mwiggenhorn]

Paypal has some sort of business loan afailable as well.

[tgcodes]

Strip has a credit facility for that. you can check stripe out