Kabbage Review (December 2022) – Pros, Cons, Features, & Pricing

Are you a business owner needing business loans to move your business to the next level? You might have heard about Kabbage and want to get a Kabbage review before applying.

Kabbage is a popular Canadian online loan platform. You can qualify for small business loans only if you have a credit score greater than or equal to 640. It allows borrowers to connect checking accounts like PayPal and receive up to $250,000 in a matter of days. Unlike some other platforms, it is not used to build your credit.

Do you also want to know more about alternative online loan apps that meet your loan needs? You can continue reading this Kabbage review to get more information on the loans and how to apply.

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Last Updated: Nov 29, 2022

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Kabbage by AMEX

  • Apply in minutes for a business line of credit
  • Accept payments through invoices and custom pay links
  • Free analytics to help you anticipate cash flow

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What Makes Kabbage a Good Option?

Kabbage is suited for small businesses that have been in operation for over a year. They grant you small business loans to expand your products and services. You must meet additional requirements before applying for a business loan from Kabbage.

Who Should Use Kabbage?

  • Individuals whose personal credit system is imperfect. Your past credit history is not very necessary when using Kabbage. The platform gets its information from banking, e-commerce, and accounting history services.
  • If you need to lay your hands on cash quickly, you should use Kabbage. The online application is usually completed in a matter of minutes. You can also get the money in a matter of days.
  • It is also for those who want to repay the loan as soon as possible. If you want a short repayment period, you should use Kabbage. The loans are up to $250,000 and can be repaid between 6 to 18 months.
Kabbage Review - Comparewise

Who Shouldn’t Use Kabbage

The business credit line of Kabbage is usually not a good fit for the following people.

  • Suppose you want a more extended period to pay off the loan. The maximum repayment period for a business installment loan is usually 18 months. This is actually shorter than other loan apps.
  • You will not qualify for the loan if your business has not exceeded one year. You can apply for a start-up business loan if you are a recent business owner.
  • If you don’t have a business checking account, you will not qualify.
  • If you need access to funds on the same day, this platform will not serve you. This is because it takes up to three working days to access funds.

Pros and Cons of Kabbage

This section of our Kabbage review will examine the platform’s pros and cons. It’ll give you an idea of how best to use its service and what its offering doesn’t cover.

The Pros of Kabbage

Absence of Extra Fees

Some other online loan platforms may charge extra fees. Some of these fees are for account maintenance, draw fees, and more. Kabbage, however, does not do such. They also do not charge annual fees, documentation fees, origination fees, or application fees. You might be required to pay monthly fees if you have an outstanding balance for some months. It is acceptable if you decide to pay back your loan on time because there are no prepayment penalties.

Available to Startup Businesses and Business Owners With Fair Credit.

We’ve established that Kabbage is not entirely start-up friendly. You need a business history of one year before you qualify. Irrespective of this, Kabbage can be a good call if you have an average credit score.

Kabbage comes in handy if you can’t qualify for a small business loan from a bank. They usually use your average monthly revenue, the length of your business time, and the account you link. These and more are used to determine your credit limit and ultimately set your account fees. 

You Have Access to the Cash Faster Than Traditional Lenders

This applies to business owners who need cash within a short period. It is fantastic if you don’t mind paying higher rates to speed up the process. Paperwork is not necessary. Instead, you connect your checking account like PayPal. The Kabbage company uses data from linked accounts to access eligibility. Up to $250,000 in finances are available in a few days.

Streamlined Application Process

The application process is streamlined and straightforward. There is no paperwork to be done. All can be done in the comfort of your house, behind your computer or mobile phone screen. Minimal documentation is also required.

No Additional Fees

There are no prepayment penalties, draw fees, and account maintenance fees are absent.

Minimum Credit Score of 640

To qualify for the loan, you need a credit score of 640. This is the minimum credit score required.

Monthly Repayment Schedule

Unlike some other online lending platforms, you can schedule a monthly repayment plan.

Kabbage Review Online Platform - Comparewise

The Cons of Kabbage

The Kabbage Platform Has a Complex Fee Structure

As a recipient of the Kabbage loan, you sometimes have an outstanding balance. The platform charges for each outstanding balance you have monthly. This differs from the interest rate that we all know of. The fee for the outstanding balance is paid together with the principal loan payments made monthly.

The fees differ for different recipients. It varies based on the loan terms, creditworthiness, and much more.

The terms as written above are as follows.

  • Six-month term: 0.25% to 3.50%.
  • 12-month term: 0.25% to 2.75%.
  • 18-month term: 0.25% to 2.50%.

A $120,000 loan with a 2% fee that is added for a period of six months would mean $124,200.

You Can’t Build Business Credit With Kabbage

Kabbage doesn’t report your payment history to commercial credit bureaus, unlike other platforms. Therefore, to build your business credit, you’ll need to find alternatives. This is because, with business credits, you can qualify for larger business loans. This comes packaged with lower interest rates.

It Requires a PayPal Account.

For Kabbage to verify your cash flow, they need a PayPal account. In the absence of a PayPal account, any other online checking platform can serve.

Reasons To Use Kabbage - Comparewise

Kabbage Product and Services

Let’s dive into the products and services offered in this Kabbage review section.

Mobile App

Kabbage has a mobile app. This app is easily accessed on both the Android and iOS platforms. The app offers a variety of solutions. It ranges from checking solutions down to payment solutions.

Kabbage users can access their checking accounts and take out up to $150,000 in the line of credit. The payments are accepted either through invoices or custom links.

The Kabbage app gets a review of up to 4 over 5 on the Google Play store. On the Apple store, it has a review of 4.9 out of 5.

Loan Amount

The Loan amount accessible for Kabbage funding is from $2,000 to $250,000.

Loan Interests

There are no traditional interests paid for the Kabbage small business loans. Monthly fees depend on the loan terms. A six-month term is from 0.25% to 3.50%. The 12-month term is 0.25% to 2.75% and the 18-month term is 0.25% to 2.50%.

From other small business loan reviews, the APR range is 9.00% – 36.00%.

Repayment/Loan Terms

There is a monthly repayment schedule.

The terms are usually between 6, 12, or 18 months.

Loan Processing

They take a maximum of three working days to process the loans and dispense cash. This depends on the bank in use, though.

Fees

No application, account maintenance, or origination fees are required.

There is another excellent feature of the Kabbage platform. There are no penalties for prepayment that can accrue over time.

Depending on the information in your loan agreement, there may be fees for paying late. There could also be fees for unsuccessful payments.

Kabbage Online Checking Account For Small Business-Comparewise

Kabbage Product and Service Quality

Still, on our Kabbage review, it has been established that it is a legitimate online loan platform. It is complete with standard and state-of-the-art security features. There are firewalls, data encryption features, and authorization controls for information access. Third parties have no access to your information. The insurance cover is by the Federal Deposit Insurance Corporation.

How to Get Started for Kabbage Loan

We can’t end our Kabbage review without outlining its application process and requirements.

Eligibility Criteria for Kabbage Loan

Before you are seen as eligible for a Kabbage loan, there are critical criteria to meet.

  • A credit score of 640 is needed. A higher score is also acceptable. You need to have spent up to one year or more in business.
  • A review of your business bank accounts would also determine eligibility.
  • Annual revenue of up to $50,000.

Documents Needed to Apply for Kabbage Loans

Kabbage review also puts into perspective the documents necessary for the application process. They are:

  • Business name, type, and industry
  • Social security number
  • Business checking account
  • Business tax ID

For those who use accounting software, up to three months’ records of your business deals are required.

Kabbage App - Comparewise

Step-by-Step Process to Apply for Kabbage Loans

It is pretty easy to apply for a business loan on Kabbage. The platform is accessible either through its mobile application or website. It takes about 8 to 10 minutes to do the application process. There are steps to follow when applying for financing on Kabbage:

  • Create a Kabbage account. You can do this either through the mobile app or the website. You can use the Amex login details if you have an American Express user.
  • Fill out the online application form. There are places for a name, business name, industry, business and home address, phone numbers, social security numbers, and business tax ID. You would also be required to consent for hard credit inquiries into your personal and business credit.
  • Wait for the identity verification process. The verification process would determine if you would get approved or be denied. The process of approving or denying the application takes a short time. It can be longer if more information is necessary. 
  • You can now sign the loan agreement once the credit limit is approved. Before signing, you need to know how much you are borrowing and the repayment terms to choose. You can approve the loan terms based on six, twelve, or eighteen months terms.
Kabbage App - Comparewise

What Happens After Kabbage Funding?

Continuing our Kabbage review, we will consider what happens after funding.

After receiving your funds from Kabbage, you can draw your funds once a day from your business credit line once a day. Every month, the minimum payment would be withdrawn automatically. It is withdrawn either through your bank or your PayPal. Provisions are also made for manual payments.

In recent times, the Kabbage credit line has been revolving. If you repay the funds loaned to you, it becomes available to you again. More precisely, having a monthly payment of $500 with a $20 monthly fee gives you access to a $480 credit line.

The online dashboard on the Kabbage platform also gives room to view payment histories. You can also see your upcoming payments through the dashboard.

Alternatives To Kabbage

Before obtaining loans from Kabbage, you must first weigh your options. This section of our Kabbage review covers alternatives you can consider before using Kabbage.

BlueVine

On BlueVine, like Kabbage, it is possible to take out a line of credit. It offers a debit card like Kabbage and allows for making cash deposits. BlueVine also allows you to receive your cash quickly and sell your invoices.

Unlike Kabbage, which gives you 1.10%, you get a 1.5% rate on your savings on BlueVine. BlueVine also accepts businesses with up to six months or more of business history.

Ondeck Review 3 - Comparewise

OnDeck

OnDeck, like Kabbage, is an online loan lending platform. It has a streamlined process for applications. The credit business lines are up to $100,000, and the loan terms are up to $250,000.

Unlike Kabbage, which offers monthly repayments, OnDeck accepts weekly repayments. The minimum credit score for this platform is 625, while that of Kabbage is 640. The interest rates are higher than Kabbage’s and may be a turnoff if you want something lower.

Kabbage Review Conclusion

The Kabbage review has shown that you do not need to worry about accessibility to small business loans. This is, of course, hinged on your meeting the necessary requirements. Your credit score should be up to 640, and your business should be up to one year. Kabbage also prefers that you are at least 18 years before applying.

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FAQs about our Kabbage Review

What is the minimum loan amount I can take on the Kabbage platform?

As already stated previously, there are several loan terms. From 6 to 18 months, and each has its minimum amount. Six months is $500, twelve months is $10,000 and eighteen months is $20,000.

What happens if I'm declined by Kabbage?

Getting declined by Kabbage doesn't mean it's the end of the road. The platform has a functional algorithm system that keeps you in their system. This is because you have already linked your accounts with them and given permission for hard reviews. If your finances improve, you can be contacted again for funding.

Is Kabbage a bank?

No, Kabbage is not a bank. It is simply an online loan platform available in Canada. The banking services for Kabbage are provided by Green Dot Bank. The insurance service for the accounts is provided by the Federal Deposit Insurance Corporation. The insurance is up to $250,000.

What is Kabbage funding?

Kabbage business funding is a business line of credit. It is offered by American Express. It offers small businesses credit. Small businesses can definitely apply. They get access to working capital and can get it in a few hours to days. It is usually between $1000 to $250,000.

Who owns Kabbage?

Kabbage is owned by American Express. It was acquired in 2020 but has existed since 2008. It is a safe platform and also trustworthy. You can trust them for your loans.

Brand

Kabbage by AMEX

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October 20, 2022
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