Kabbage is a non-traditional lender that aims at providing a line of credit to small businesses that are struggling with their economy. Kabbage is ideal for small businesses that are running low on their reserves and need a fast access to working capital. Kabbage neither takes your business tracking record into account nor does it require you to have a good credit score; instead, the company focuses more on the e-commerce and banking data of your business in order to approve your application for a loan. With regards to the ease of application process and the timespan required for the availability of funds, Kabbage is amongst the best in the industry. The online application takes only a few minutes to fill out and in most cases, you will have the funds available to you within a few days once your application has been approved. The company issues up to $150,000 in lines of credit.
Kabbage is best suited for small businesses that need immediate access to cash. The application process does not involve any paperwork. You can simply connect with a business checking account such as PayPal, eBay, Amazon, and many others. Kabbage uses the information from these accounts to evaluate your application. Although Kabbage reviews your credit history, the company’s loan approval does not depend solely on your credit history as they take several other factors into consideration as well. Primarily, the company reviews your linked business accounts, your years in business, and your average revenue to decide whether you should be awarded a loan. In simple terms, even people with a relatively bad credit history can obtain their loans.
Although Kabbage does offer great services overall, these services really don’t come in cheap. The company’s interest rates are among the highest in industry, ranging from 24% to 99%, making it less suitable for purchasing large equipment and long-term services. The fee structure is complicated and inconvenient for customers, and the loan is basically short-term. You can choose to repay the loan in an either six months or one year term, while the fee structure is organized in a way that you’ll be repaying a major portion of the amount lent within the first few months. Kabbage is only suited for those small businesses that have immediate cash requirements and do not mind paying higher interest rates.