Kabbage is a financial lender for small businesses. The company is based in Atlanta, Georgia and has provided over $3 billion to more than 100,000 businesses since it was launched in 2009. All Kabbage business loans are made by Celtic Bank, a Utah-chartered industrial bank.
Kabbage provides businesses with a line of credit they can access if and when needed. Companies are only charged for the money they withdrawal not the entire line of credit.
To apply borrowers must create an online account and complete a short application form. Kabbage bases approval and the amount of money it provides for a line of credit on real life financial data, not just on personal credit scores. Therefore, applicants must grant access to their business checking accounts or other payment platforms, such as PayPal, Amazon, eBay, and Etsy.
Instead of interest rates, Kabbbage loans charge a monthly fee for every month you have a balance. Fees range from 1.5% to 10% of the loan amount. That's the equivalent of 20% to 99% APR. To illustrate, a $10,000 loan with a six-month term would cost the average borrower $1,200 in fees. This is the equivalent of 40 percent APR. A $100k loan with a one-month repayment term could cost $4,000 in fees, the equivalent of a 48% APR. There are no prepayment penalties so you can save money by paying early.
Lines of credit range from $2,000 to $150,000.
Kabbage operates in all 50 states.
Kabbage's application process is as fast and straightforward to complete. The entire transaction, from filling the loan application to receiving the funds can take as little as 10 minutes. Kabbage determines eligibility and how much cash a business can qualify for based on factors such as their seller rating, time in business, the number of transactions, and revenue.
Kabbage is faster than most other business loan providers. While traditional banks can take weeks or months to process a loan, Kabbage reviews the data through their automated online application to quickly approve small businesses for flexible lines of credit of up to $150,000. Kabbage's typical fees are the equivalent of 40 percent APR, which may seem expensive when compared to traditional bank loans, but is competitive when you look at the rates charged by alternative sources of credit for small businesses.