Apply for a line of credit up to $250,000 and take your small business to the next level.
Kabbage’s nontraditional approach to assessing your application also opens up this option to businesses that have had trouble qualifying in the past.
| Product Name | Kabbage Small Business Line of Credit |
|---|---|
| Min Loan Amount | $500 |
| Max. Loan Amount | $250,000 |
| Interest Rate Type | Variable |
| Minimum Loan Term | 0.5 year |
| Maximum Loan Term | 1 year |
| Requirements | 1+ years in business, $50,000+ annual revenue or $4,200+ monthly revenue over last 3 months |
Pros
- Convenient application and access.
- Borrow enough for your business.
- Get an instant decision.
Cons
- Loans for business use only.
- Fees of 1.5% to 10% of the loan amount.
- Business revenue must top $50,000 a year.
- In business for at least one year.
- Minimum of $50,000 in annual revenue or $4,200 per month over the last three months.
Kabbage is best for…
- Quick cash. Qualifying only takes a few minutes and you’ll have easy access to cash as long as your credit line is open.
- Fair credit borrowers. Kabbage’s nontraditional approach puts less weight on your credit score than other lenders.
How does a Kabbage line of credit work?
Kabbage offers short-term lines of credit to businesses in all 50 states that might not have the best credit. You’ll have to meet some basic eligibility criteria, but if approved, you could have access to between $500 to $250,000. Since you’ll be borrowing a line of credit and not a term loan, you can choose to borrow as much or as little as you need, up to your approved credit limit.
You can withdraw your funds through the Kabbage App, Kabbage Card and website. This makes it easy to get the money you need when you need it, and you’ll only pay fees on what you borrow. You can even pay your monthly bill early without incurring any additional fees.
Compare Kabbage to other top business loan providers
How do I withdraw my funds?
You can use Kabbage to cover any business expense, from purchasing inventory to covering an unexpected expense. When you’re ready to borrow, you can access your Kabbage line of credit one of three ways:
- Kabbage Card. Your Kabbage Card can be used anywhere Visa is accepted to make a purchase.
- Dashboard. Every 24 hours, you can use the Kabbage dashboard to draw funds deposited directly to your checking or PayPal account.
- Kabbage App. Kabbage has an app you can use on iOS or Android so you can quickly apply for a loan and access your loan funds.
More about the Kabbage Card
Kabbage created its Kabbage Card to give you access to your line of credit whenever you need it and wherever Visa is accepted. Because it isn’t a credit card, there are no extra fees to withdraw from your line of credit.
Every time you use it, you create a new six-month loan with the same terms as your other loans. It won’t impact your credit, and there is no minimum purchase or limit to the amount of items you can purchase. However, you are limited to how much you can spend — up to $25,000 per day, $50,000 per month and $60,000 per year.
The Kabbage Card allows you to use your line of credit instantly. There’s no waiting period to transfer funds, and you’ll even be able to withdraw cash without any additional fees. You can use it online or in-store to pay for nearly any expense your business needs.
How much does a Kabbage line of credit cost?
Kabbage doesn’t charge interest on the money you borrow, but you will be assessed a few fees depending on how much you borrow and the length of your loan term.
Each loan you borrow is treated as a separate installment and will be charged a fee. Every month, you’re expected to pay back either 1/6th or 1/12th of the amount you borrowed in addition to the monthly fee. You may also be assessed a 1% to 10% of your selected loan amount for the first two months of a six-month loan or the first six months of a 12-month loan. This amount will be lowered to 1% for the remaining period your loan is withdrawn.
You have a four-day grace period before you’re charged a fixed fee based on the balance you’ve withdrawn.
Benefits of a Kabbage line of credit
Kabbage looks at your business’s performance when considering your application, not just your credit score. Here are some other benefits of getting a Kabbage line of credit:
- Fast turnaround. Most business lines of credit can be approved instantly, with funding deposited in about three days.
- No origination fees. Kabbage doesn’t charge any origination fees when you borrow money.
- Geared toward small businesses. Kabbage requires only that its borrowers have at least one year of business under their belt and make $50,000+ annually or $4,200 every month.
- Wide range of available funds. You can borrow as much as you need for your business from $500 to $250,000.
- Minimal fees. You won’t pay establishment fees and there are no penalties for making payments early.
- Convenient access to funds. If you’re approved, you’ll have ongoing access to your line of credit 24/7.
- Applying won’t hurt your credit. Kabbage won’t do a hard check on your credit until you accept a line of credit offer.
- Linking multiple accounts. The more business accounts you provide to Kabbage, the better your chances at getting the loan you need. Link up business accounts like your checking, PayPal, eBay, Amazon or QuickBooks.
What to watch out for
- Short repayment terms. Kabbage only offers 6 and 12 month loan terms.
- Short-term financing. If you keep a balance on your line of credit for longer than a year, you could accrue hefty fees.
- Complicated fees. Kabbage’s unique fee structure is a bit difficult to follow and can sometimes be more expensive than what you’d find with other online lenders. It also makes comparing rates more challenging.
- You can’t save much with prepayment. Kabbage front-loads fees, meaning that you won’t be able to save much by paying early unless you repay your loan in the first few months.
- Smaller loan amounts. Kabbage might not be able to help you out if you’re looking for financing over $250,000 that your business needs more than a year to pay off.
What do customers say about Kabbage?
Customers are mostly pleased with Kabbage, though not all online reviews are glowing. Kabbage gets an A+ rating from the Better Business Bureau (BBB), a 9.3 out of 10 rating on Trustpilot — both solid scores. Several reviewers were happy with how easy it was to apply and manage their accounts. Others highlighted its customer service team as friendly and professional.
Go into other forums, however, and you’ll get a different picture of Kabbage. People with eBay stores in particular though Kabbage’s fees were too high and terms were too short. Others had difficulty qualifying because of the annual revenue minimum. Some complained about the way Kabbage handled their late payments.
Some customers were also upset about how Kabbage responds to natural disasters. Two customers said their credit limit was reduced to $1,000 after being hit by Hurricane Irma (one said they previously had a limit of $38,000). Both claimed the decision was based on location, rather than business performance. A third customer said their credit line was also reduced after being hit by Hurricane Harvey.
Is Kabbage legit?
Yes, Kabbage is a legit online business lender that is a member of several safe lending practices organizations, including the Innovate Lending Platform Association.
- A+ BBB rating. BBB accredited since 2014, Kabbage has an A+ rating.
- FDIC insured. All Kabbage business loans are issued by Celtic Bank, member FDIC.
- SSL encryption. Kabbage’s website is encrypted with Secure Sockets Layer protection to safeguard your information.
Kabbage was recognized at the Lend360 conference in 2018 for its noteworthy innovation in helping borrowers get easy access to funds at time of purchase.
Ready to apply?
Have your checking or PayPal account ready, and include any other accounts your business uses, including:
- Authorize.Net
- Stripe
- QuickBooks
- UPS
- eBay
- Amazon
- Yahoo
When you’re ready to apply, click the Go to Site button on this page to get your online application started.
- Apply online. Create an online account by providing your email and creating a password. Tell Kabbage the name of your business and the type of industry it is.
- Link your business information. Link your business’s checking account, along with any other accounts including PayPal, QuickBooks or Amazon.
- What you need to qualify. Your business has to be at least one year old and have a minimum of $50,000 in annual revenue, or $4,200 per month over the last three months.
- Quick decisions. In minutes you will be told if you’re approved and how much money you are qualified for. You’ll have access as soon as the next business day and are only charged a fee once you draw on your credit line.
How do I get the Kabbage Card?
- Visit the Kabbage website and log into your account.
- Click the button to request a card.
- Request to have the card mailed to your business or business address.
- Wait for the card to arrive, usually 7 to 10 days.
- Once the card arrives, log into your account and agree to the cardholder terms.
- Activate the card and set a secure pin.
After you’ve activated your Kabbage Card, you can use it whenever you need to make a withdrawal from your line of credit.
Bottom line
If you have poor to fair credit and are looking for a loan to get your business off the ground, Kabbage could be a good fit for the short term. It’s a quick and easy way to get money for your business and offers the convenience and flexibility many business owners want without hefty interest rates. However, you’ll still want to consider comparing other business loan providers so you can be sure you and your business find a great deal.