Shopify Capital looks founder-friendly. Until it isn’t.

Shopify Capital and other Shopify lending options promises fast cash, no equity dilution, and simple daily repayments. On the surface, it feels like a no-brainer.

But for many ecommerce brands, the real cost is buried in the fine print.
At the heart of it is something called a UCC-1 financing statement, a legal mechanism that can quietly impact your ability to grow, raise, or even work with other lenders.

What is a UCC-1 lien and why does it matter?

A UCC lien allows Shopify to place a blanket claim on your business assets. That includes your inventory, receivables, IP, and even your business bank accounts.

Here’s why it matters:

• You may be in breach of other lending agreements without realizing it
• Shopify funds fast and gets paid first, with no coordination around the relationships you’ve worked hard to build with your other lenders
• The lien can block refinancing, new fundraising, or access to growth capital
  You’re giving up security without receiving the favorable terms that usually come with a senior loan

In July 2025, Shopify updated its Help Center to publicly state:

“The Shopify Capital loan agreement includes a security interest in business assets… A UCC-1 financing statement may be filed based on several factors.”

Many founders only discover this when a lien shows up on a lender search and derails their next move.

The more you grow, the more they take

Shopify Capital’s loan structure uses a daily repayment model based on a percentage of your sales. That means during peak seasons like Black Friday Cyber Monday (BFCM) or a successful product launch, your repayments increase right alongside your revenue.

Founders tell us:

“We thought we’d be reinvesting peak revenue into ads and inventory. Instead, it was getting pulled out automatically.”

This uncapped, unpredictable repayment structure leaves you with less control when you need capital the most.

Why founders are switching to Clearco

Clearco was built as a Shopify Capital alternative that gives founders more flexibility and transparency.

We designed Invoice Funding to support growth without restrictive terms. With Clearco, there are:

• No “blanket liens” and no collateral required
• No platform lock-in or ecosystem dependency
• Capped weekly payments you can plan around
• The ability to draw funds as you need them and only pay for what you use
• Full flexibility to use capital on Shopify, Amazon, Walmart, Meta, TikTok, or your own DTC store

Real ecommerce brands are making the switch

Top DTC brands in fashion, home goods, and wellness have outgrown Shopify Capital after running into unexpected friction.

Some paid off their Shopify loan early and faced delays in getting a new offer. Others were blocked from refinancing once lenders saw the UCC lien on their business.

They moved to Clearco to fund growth on their terms without giving up control.

If you’re currently using Shopify Capital, or just exploring funding options, now is the time to take a closer look at your agreement. A single clause could be the reason your next expansion or raise hits a wall.

Compare your options

Clearco offers fast, flexible, non-dilutive funding with none of the hidden traps found in Shopify lending. We’ll help you explore what you qualify for and how it compares to your current offer.