In this article, we will walk through the application process for Kabbage, which offers lines of credit for small businesses up to $150,000. We will go over the information and documents you need on hand to apply to the company, and what each step of the process entails.
Kabbage offers lines of credit for small business owners of up to $150,000. Lines of credit are best suited for short-term projects and expenses, such as covering cash flow gaps from unpaid invoices or meeting daily working capital needs.
|Kabbage Details (Read Review)|
|Line Amounts||$2,000 - $150,000|
|APR Range||20.00% - 80.00%|
|Line of Credit Terms||6 or 12 months|
|Funding Time||As fast as same day|
What Information Do I Need to Apply?
Kabbage will ask for the following pieces of information when you apply for a line of credit:
- Personal information: name, home address, Social Security Number, phone number, date of birth, email address.
- Business information: business name, address, phone number, industry, legal entity structure, date established.
- Financial information: online bank or payment account login credentials, login credentials for other online business accounts (e.g., bookkeeping, merchant, payment processing). This information is used to securely connect to your online accounts so you don’t have to submit copies of bank account statements or other documents. Kabbage doesn't store or see your login credentials and cannot change your bank account.
- Documentation: Generally, you won’t need to provide any documents to Kabbage as the underwriting process is automated. However, there are a couple of cases when you need to submit documents, which we outline below:
- In case of error, copy of bank statements and a color copy of a voided check are required if you cannot connect to your online bank account.
- Proof of ownership may be required through articles of organization or incorporation.
Below, we outline the step-by-step process of applying for a line of credit from Kabbage.
1. Enter business information
To begin the application, you will need to create an account on the company’s website. You’ll also need to enter some information about your business. This includes your business’s name, address, phone number, industry, legal structure, and date of establishment. There are reasons that Kabbage asks you to create an account. First, if you are approved, you’ll need an account to manage your withdrawals and repayments on your line of credit. Second, if you are not initially approved, Kabbage will monitor your business activity to see if you can be approved at a later date.
2. Link online business accounts
At this step in the process, you will need to link an online business account to your Kabbage one. If you’re worried about privacy, Kabbage does not store or see your login credentials and cannot access or change your bank account data. You must connect at least one account to Kabbage that demonstrates your business’s revenue, such as a bank or PayPal account. You can also link other types of accounts, such as merchant, payment processing or bookkeeping accounts, that can help Kabbage get a full picture of your business and its financial situation. However, you don’t need to link additional accounts beyond a bank or PayPal account to be approved for a loan. It’s better to link a few accounts with recent activity than a lot with little to no activity. It’s also ideal if you’ve been in good standing with your bank in the past 90 days.
While applicants can search for their bank by name or by clicking on their bank’s logos, we recommend that applicants search for their bank by using the routing number associated with their bank account. Once you find your bank, you will need to login by using the credentials for that account. If you cannot connect to your bank for whatever reason, you can still complete the application, but you will need to submit copies of bank statements and a color copy of a voided check to Kabbage.
3. Enter personal information
The last step in Kabbage's application process is to enter your personal information. The information entered must be for someone who's an owner of the company. During the application process, you may be required to show proof of ownership by submitting a copy of your articles of organization or incorporation.
As part of this step, you will need to enter your Social Security Number. Kabbage will conduct a hard inquiry into your personal credit report. A hard inquiry can affect your personal credit score, causing it to drop a few points. While Kabbage will look at your personal credit during the application, the company does not report information about your business line of credit to the personal credit rating bureaus. This means that any payment history, whether positive or negative, on your Kabbage line of credit will not appear on your personal credit report. However, if you make a formal request, Kabbage will report your loan information on your business credit report at Dun & Bradstreet.
4. Loan decision and withdrawing funds
Once you hit submit on the application, Kabbage will analyze your information to make a decision. This process can take a few minutes. If you’re approved, you'll see a dashboard, similar to the one depicted below, with the line amount and payment schedule. Regardless of what you’re approved for, you aren’t obligated to withdraw the full amount offered or to take funds immediately.
If you decide to withdraw funds, you can choose how much you want to withdraw at a given time as well as a time limit for repayment. After you’ve selected a loan amount, you will see a payment schedule below that will show how much you owe each month. In order to get funds deposited into your bank account, you'll need to select “Continue to Review” to review the loan details and bank account information and to e-sign the loan agreement. Once completed, you can expect funds into your bank account within one to three business days. If you take out multiple loans against your line of credit, you'll still only have one monthly payment.