If you’re looking for a business loan, you will come across Kabbage. But even if you just keep up with financial news, you may have heard of them. Kabbage business funding is a fast and modern alternative to business bank loans. Their short-term loans and lines of credit have set them apart from other lenders. For starters, Kabbage is very well received by the Better Business Bureau and its customers. When you look into the reasons, straightforward service is at the top of the list.
Kabbage business funding doesn’t come with the lowest rates. But there are a few other factors that have contributed to its recent success. Let’s have a look at what’s going on behind the scenes.
Kabbage Business Funding Analytics
Japan’s SoftBank invested $250 million in Kabbage back in 2017. This topped off a round of fundraising that landed Kabbage about $700 million. Then, Kabbage took these investments and used them primarily to expand its US business. It did this by putting the money to good use, investing a large portion into more analytics tools.
Kabbage makes loan decisions by analyzing many different sources of information to decide on whether to lend. If the automated decision is to give a loan, the company can use the same big data to decide how much.
The sources of information for Kabbage’s big data analysis vary widely. Potential sources of information include:
- Social media profiles
- QuickBooks accounts
- Other macro data sets
But the bulk of Kabbage’s work is analyzing business financial information. They do this through bank accounts and accounting software.
|Lender||Minimum Revenue||Time In Business||Minimum Credit||Next Steps|
|$50,000/yr||1 year||560+||See if you qualify|
A History In Fintech
Kabbage has always been a tech-centered alternative lender. When the company started in 2008, it arrived early to the analytical underwriting party. The company was among the first to use “big data” to underwrite and monitor its loans.
In the end, Kabbage mainly just uses the same information as banks to come to its conclusions. We couldn’t possibly explain every single factor that goes into fintech lending analyses. But the result is faster decisions, more transparency, and a hugely successful business.
Kabbage’s automated systems are connected to several data sources. The most important of these are the business banking accounts and eCommerce platforms that any borrower uses. Data like social media engagement will not affect their decision on whether to accept you. But if they do accept you, high engagement might increase how much they are willing to lend you.
These data sources are connected first at the point of origination. But then they stay connected throughout the entire loan term.
Small Businesses Ignored By Banks
The process Kabbage employs allows it to not only work quickly but to serve the under-served. If you go to a bank asking for a business loan of under $100,000, you will often be rejected. For Kabbage, loans of this size are the norm. As a core focus of the company, Kabbage business funding is actually ideal for smaller businesses. The company isn’t competing with the banks but is cornering another under-served market.
Kabbage Business Funding’s Acceptance
You don’t need to take Kabage’s word on all this information.
At a time of rightful distrust of online lenders in general, Kabbage has managed to not only miss the scrutiny but to thrive. The company has been featured on the likes of Forbes for its services. It has proven that while costs are always a priority for a borrower, honesty and transparency are priceless.