Etsy begins processing seller payments via alternative partners after delays caused by SVB implosion
Etsy is starting to process seller payments via its other payment partners this morning following the collapse of Silicon Valley Bank, the company confirmed to TechCrunch. On Friday, the online marketplace warned sellers in an email that the collapse of Silicon Valley Bank was causing delays in processing payments and that it was working on a solution.
A spokesperson for the company told TechCrunch in an email that the issue has impacted a small group of sellers, noting that approximately 0.5% of its active seller base had their payments delayed on Friday. Etsy is working to pay these sellers today and has already started processing payments via another payment partner this morning.
"At Etsy, supporting our sellers is our highest priority, and we understand how important it is for these small businesses to be able to receive their funds when they need them," the spokesperson said. "We recently experienced a delay in issuing payments to some sellers related to the unexpected collapse of Silicon Valley Bank. Our teams have been working around the clock to implement a solution. We expect to pay sellers via our other payment partners and are starting to process these payments as soon as March 13.”
Many Etsy sellers rely on the income they receive from selling products on the platform, and after being notified that those scheduled payments were affected by the bank’s collapse, some sellers said they were putting their stores on "vacation mode" until the situation was resolved.
The drama with Silicon Valley Bank began last Thursday when the bank announced that it was raising additional capital by selling stock. Venture firms then began advising portfolio companies to move money out of the bank. On Friday, the California Department of Financial Protection and Innovation took over and closed the bank to protect deposits. The Federal Reserve issued a joint pair of statements on Sunday, noting that Silicon Valley Bank’s depositors, both insured and uninsured, will receive help in a manner that will “fully protect” all.
The implosion marked the largest U.S. bank failure since the global financial crisis more than a decade ago. The fallout is impacting a range of startups and larger firms, including publicly traded companies like Roku, Roblox, Quotient and others.