These Kabbage reviews answer that small business financing question honestly (yes, these loans are perfect for fast money for people with poor credit) so you can decide if applying for a Kabbage loan or line of credit is a good move for your small business or not. You can apply online in about 3 minutes here.
- Good – Quick Cash for Poor Credit Individuals
- Bad – Higher Fees and Shorter Repayment Schedule
Every business needs money, working capital, to stay open for business. To have merchandise to sell you need to buy materials to build inventory. Payrolls costs need to be paid even during seasonal sales fluctuations. Small businesses rely on loans to fund these activities. Kabbage is one choice of alternative financing that is a good option for some companies.
You can apply online in about 3 minutes here. Our Kabbage reviews loved the super easy application process and is a plus for busy entrepreneurs. In comparison, other many banks require completion of long loan documents. You will know if you are approved within 48 hours. Then you will receive the loan proceeds very quickly often within just a few short days. This is crucial for businesses that are working to capture opportunities with strict deadlines.
Instead of just using your personal credit score to evaluate your loan worthiness, instead, Kabbage studies your accounting and banking data. Lots of entrepreneurs have less than stellar credit history. Kabbage knew that fact and crafted their small business loans to work around the business owners credit scores. Because they are lending money to more risky ventures, their fees are higher than some other financing alternatives.
Small businesses can borrow up to $100,000 to pay for payroll expenses, inventory, merchandise, marketing, and advertising.
#1 benefit to small businesses is the speed of application to receipt of monies. This entire process from applying for the loan online to getting cash in your Paypal account can be accomplished in under one week. Compare that to traditional lenders schedule of over 30 days+.
Lots of business owners love not having to fill out endless forms and reams of paperwork to apply for a business loan of credit. Kabbage, being a leader in the digital revolution, uses the data from your online accounts such as Quickbooks, Xero Paypal Ebay, Etsy and Amazon, to evaluate your credit worthiness.
Bad credit is not an impediment to getting this small business loan. Many an entrepreneur is held back from getting funded for their ventures due to past credit mistakes. Yesterday’s tough times stop people from moving forward into their own business. Fortunately, this is not as much of an issue at Kabbage. They will check your credit score but not use it exclusively to approve your loan. The data from your online business activity is considered more heavily and weighted to your advantage. The loan fees are based on the data you supply.
Complex fee structures are hard to understand. Your fees will be based on Kabbage’s assessment of your ability to repay. It is structured similar to conventional mortgages, where you pay the interest first and principal later. Each monthly payment is comprised of both a percentage of the loan amount and your interest fee. In this example of a six month loan you pay a fee of between 1%-10% of the total loan for the first 60 days. Thereafter the fee amount reduces to 1%. Read your loan agreemnt for full details on these fees.
Rates are higher than traditional lenders due to the lenient credit requirements. You pay Kabbage extra money for their trust in your less than stellar credit rating. They take greater risk by lending to such individuals and need to charge more to cover loan defaults.
- Loan Amounts – $2,000 – $100,000
- APR Annual Percentage Rate – 24% – 99%
- Funding Schedule – Minutes to a Week
- Repayment – Six months to one year
- Qualifications – One year in business with $50,000 in sales. Must have a business checking or online bank such as Paypal.
Qualifying for Kabbage is straightforward. As with all types of small business loans, it is wise to review the banks requirements listed below before applying. Applying is free. You know that you do not need to accept the loan or credit line upon approval. Kabbage is more lenient than most lenders and you may find that you do indeed fit the requirements.
- No set number for personal credit score – great for those with low, poor or bad credit
- Only one year in business
- $50,000 in sale revenue annually, or at least $4,200 for the last 3 months.
- Business checking account or online payment system such as Paypal. For loan proceeds and to make automatic payments.
When considering getting a business loan it is wise to review all your options. Here we review the top alternative financing options as compared to Kabbage, Ondeck and Paypal Reviews.
|Features||Kabbage||OnDeck Capital||PayPal Working Capital|
|Loans Minimum and Maximums||$2,000 - $100,000||$5,000-$500,000||$1,000-85,000|
|Payment Period||1-12 months||3-36 months||No set time period. 1-18 months|
|Approval||Day of application||Day of application||Day of application|
|Credit Scores||550 plus||500 plus||No set score|
|Credit Limits||Varies dependent upon credit scores||Up to 15% of annual sales||4-15% of annual PayPal sales|
|Use of Loan Proceeds||Inventory, Payroll and Business Expenses||Inventory, Payroll and Business Expenses||Inventory, Payroll and Business Expenses|
|APR (Annual Percentage Rate)|
Varies dependent upon credit score
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Kabbage is BBB accredited since 1/21/2014. Below is the link to the Better Business Bureau complete report for Kabbage, Inc. I have personally read all reviews and complaints and my conclusion is a small percentage of customers have had administrative issues. The reviewers and complainants write about lost paperwork, delayed approvals, and customer service misunderstandings. Honestly, this could be said of any large financial institution who deals with millions of loans. The vast majority of customers are positive and 5 stars for Kabbage reviews.