About Kabbage
Kabbage is a data and financial technology firm situated in the Atlanta metropolitan area. It was formed in 2008 to automate the time-consuming online application process for small business owners.
Kabbage is an American Express-owned financial technology firm providing loans starting from $500. It was ranked the 36th fastest-growing private company in America by Inc. 500 in August 2015, after which the company went out to raise $135 million in a Series E investment round headed by Reverence Capital Partners in October 2015.
Kabbage accounts are issued by Green Dot Bank. Upon verification of the Cardholder's identification, the account funds are FDIC-insured up to the permissible limits through Green Dot Bank, Member FDIC. The coverage limit is calculated by adding all of the accountholder's money on deposit with Green Dot Bank. Banking services are provided by Kabbage Debit Mastercard issued by Green Dot Bank, Member FDIC, according to a license from Mastercard International Incorporated. Green Dot Bank and Green Dot Corporation do not provide any other Kabbage goods or services.
Pros and cons
Accepting applications from qualifying small businesses in the United States seeks to ease the loan process and provides fast access to working capital. However, before borrowing money online, it is critical to educate yourself on all of the benefits and drawbacks:
Pros
The application process is straightforward with little paperwork required.
The company offers loans up to $250,000 issued within a few days.
The minimum credit score requirement ranges from 640.
Repayment schedule (monthly repayment schedule as opposed to daily or weekly).
There are no prepayment penalties, account maintenance fees, or annual fees.
Cons
To verify cash flow, you must have online banking or a PayPal account.
Personal guarantee is required.
The monthly fee structure is complicated.
Loans cannot be used to establish fair credit for a firm.
Loan conditions
Underwriting standards vary per lender, but they often include information from an applicant's minimum credit score record as well as other business data that reflect the potential to repay the loan, such as company cash flow and business revenue. Whereas meeting the standards listed below doesn't guarantee approval, they'll assist:
To qualify for financing, candidates should have a personal credit score of 640. The lender also examines the company's commercial record but does not disclose the needed business credit score.
An application must have been in the company for at least one year to be eligible for a business line of credit. A company checking account must also be established so that cash may be distributed.
It does not disclose its yearly revenue minimums for business finance applicants. The lender does say, though, that a company's annual percentage yield might influence the loan limit for which it qualifies.
Funding a loan
Kabbage's loan financing procedure is online and takes around 10 minutes to complete. You'll need to input some personal information as well as essential company information, such as your legal name and address, industry type, and federal tax ID or employee identification number. You must also agree to a heavy draw on your personal and company credit records. Kabbage will approve or reject your application after analyzing the health of your business, or personal credit history using an automated online method.
