Transactions Frozen for ‘Mompreneurs’ on Etsy Due to Silicon Valley Bank Collapse
This week, the second largest bank failure in United States history happened after Silicon Valley Bank (SVB) closed its doors due to rising interest rates.
While the Biden administration has attempted to reassure investors and American citizens that the collapse is a one-off incident that will be contained, other politicians, talking heads, and investors have already sounded the alarm about the spillover effects that the failure of SVB will have.
The failure caused a Great Depression-esque bank run when tellers were forced to call the police on patrons attempting to get their money.
SVB Has Gone Under Completely — The Second Biggest Bank Failure in U.S. History@TuckerCarlson: "When customers showed up at SVB's branch in Manhattan today to get their deposits back, managers called the police. So what we have here is a 1929-style bank run. And that's not a… https://t.co/zugk2ejgYk pic.twitter.com/UBYJJUSvWn
— The Vigilant Fox 🦊 (@VigilantFox) March 11, 2023
In one example of the spillover effects that SVB’s failure has caused, sellers on the retail website Etsy were forced to pause transactions due to the collapse of SVB.
‘I’ve been an Etsy shop owner since 2015, I do very well on Etsy,’ one woman said on TikTok.
‘I noticed today my money that was supposed to be deposited to be available tomorrow was never sent to my checking account.
‘Then I get an email saying because of the Silicon Valley Bank, they cannot issue my deposit. My money, that I worked hard for, they can’t send to my bank account.
‘The money I was expecting to have in my bank account tomorrow they can’t send to me. Why is that my problem?’
She added: ‘I have to pay my mortgage in a few days and I can’t because they have my money on hold.’
@amgeee1 How is this okay?! Its a bday weekend in our house & this is a huge kick in the teeth. #etsyseller #etsyshop #etsybusiness #siliconvalleybank #werescrewed ♬ original sound – amgeeee
Another entrepreneur who runs a personalized gift company said she was ‘freaking out’ over the news.
‘I’m a mom-of-three, I run a small business, I do this from my home,’ she said in a TikTok video.
‘Those funds feed my family and pay my bills.’
She said she hoped customers would use her own online shop instead, adding ‘fingers crossed that we get our funds on Monday.’
@littlemisslovelyus Etsy withholding seller funds due to silicon Valley Bank Failure. 😩😫 #etsyholdingfunds #svb #siliconvalleybank #smallbusiness #svbank #etsyseller ♬ original sound – Little Miss Lovely Creations
The online retail company was forced to email sellers that there will be a delay for their scheduled deposits.
‘We wanted to let you know there is a delay with your deposit that was scheduled for today,’ an email to sellers read.
‘This delay was caused by the recent developments regarding Silicon Valley Bank, who uses Etsy to facilitate disbursements to some sellers.
‘We are working with our other payment partners to issue your deposit as soon as possible.’
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BREAKING: Etsy has delayed payments to its creators due to the Silicon Valley Bank collapse. pic.twitter.com/MiluD05hdQ
— Kevin Malone (@Malone_Wealth) March 11, 2023
Some Etsy sellers went so far as to say that if the company cannot resolve the issue soon, they will be forced to shut down their businesses.
‘If this doesn’t get resolved soon, I will have to shut down by Etsy account because I just can’t afford to take the risk of processing orders without knowing when I’ll be paid.
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