Kabbage Alternatives

An Overview Of Kabbage Alternatives

Maybe you have some free time and you wish to make some extra money. Or maybe you’re just bored. Maybe you need money for college, but your hours are such that a part-time job isn’t practical. And you’ve heard of people making money on the internet. If they can do it, you should be able to do it. It’s worth a try.

So you’ve decided to go into business for yourself.  You’ve joined the thousands of other entrepreneurs and started an online business.  You’ve converted your kitchen into a baking or food processing plant, or turned your garage into a workshop. Your office consists of a desk and computer in a spare bedroom, which also doubles as a warehouse for your small inventory.  It’s not much,  but in the cyber world it’s frequently enough to get started.  Many computer geeks who started experimenting in their garage are now millionaires.  Bet you could name a few.

So you haven’t got much to start, but business is good–it’s got potential.  But it’s not growing as fast as you’d like. You need a cash advance, a small business loan. None of the banks or financial institutions you’ve approached are interested–they need collateral, or they’ve got bigger fish to fry.  And your makeshift facilities, as practical as they are for the time being, just won’t cut it as collateral.  Those banks are not even swayed by your impressive website.

This is the problem facing many of the businesses being started online.  These businesses, for the most part, have limited, or no assets, to secure a traditional loan. And most banks or traditional loan companies are not equipped to handle the types of funding these businesses require.  So what do you do?  You do an online search for Kabbage Competitors.  Kabbage.com is an online financial group that specializes in small business loans for online businesses.  Chances are, somewhere in your search you’re gonna find the right company.  It’s just a matter of finding the right fit.

More and more online loan companies are starting up to satisfy needs of this new internet business community.  And it’s a whole different ballgame  In order to obtain a loan from one of these Kabbage Competitors, borrowers need to be able to meet a new and different set of  requirements than those asked for by  traditional banking institutions.

For the most part, these new online companies are not interested in solid, brick and mortar, collateral.  Usually, for Kabbage Competitors, all the necessary information is available online.  They can research your history, business records, volume of business, and virtually anything else they need.  Usually with your permission, of course. Borrowers can submit an application and receive their money very quickly–sometimes in minutes.  The possibilities in this age of instant communication are mind boggling.

This article reviews some of the loan companies and explains briefly what is needed to obtain  loans from them.  The list is by no means complete, and the information is subject to change at any time. Before doing business with these, or any other companies, confirm the facts before making any decision.  As with any transaction involving online business matters, one should be diligent and careful to avoid scams.

Some companies, like Amazon and PayPal, have been around for many years and are well established.   Others, new and not so well known, can be found easily with an online search.  Most of the small business lenders that do business with online companies are doing a good job, but they are unregulated so watch for hidden charges and excessive interest in some cases.

First on my list is the aforementioned Kabbage, a lesser known company, but becoming very popular and getting good reviews. This will be followed by a number of other Kabbage Competitors who, likewise, do not have the visibility of giants like Amazon and Paypal.

And last, but not least, Lendvo, a company that does business in a little bit different way which may be more to your liking, depending on your needs.

Apply For Financing

A Closer Look At Kabbage

With Kabbage.com, you do not get a traditional loan.  You receive a line of credit with funds  deposited in your Paypal account.  This is a different approach from most other Kabbage Competitors.  There is no cost to withdraw funds, and you pay only for what you take out.  Credit lines start at $2,000 with a maximum of $100,000.

To qualify you must be in business for at least one year and have an annual revenue of $50,000.
Loans cannot exceed 6 months.  Payments are one-sixth of the amount of the loan plus monthly fees.

Although listed by Forbes as one of the top most promising companies of 2015, you should be aware of the possibility of  higher than expected interest rates.

Amazon Capital Services – Amazon Lending

A loan from Amazon is harder to come by.  To qualify for funding, you must be an Amazon seller.  This requirement presents a downside in that the Amazon website focuses on the product rather than the seller or manufacturer, and many times the buyer will go back to Amazon to repurchase the product rather than buying from the original source.

This is not good for your bottom line when you pay a membership fee to Amazon in addition to anywhere between 6 to 15% commission. Also, you may find large loans are very difficult to get.  These applications favor mostly to top performers.

It usually takes about 5 days to obtain a loan.  The interest rates are based on the amount of the loan and the borrower’s performance.  However, they are usually less than 14%.  There may be additional charges from Amazon Fulfillment Services for storing, packaging and shipping, if needed.

Paypal Working Capital

With Paypal, there is no credit check and if your loan is approved you will receive it in minutes.To qualify, you must process your credit card payments to your business through PayPal.  This is probably one of the best Kabbage Competitors for a very small or beginning business.

There no interest charged.  You pay a one-time fee based on the amount of your loan.  The maximum amount that you can borrow is $85,000.  However, the amount of your loan cannot exceed 15% of your annual sales.

Your eligibility for a loan is not based on your credit score, but on your Paypal history.  There is no interest.  Your payment is a percentage of daily sales deducted daily. If there are no sales on a certain day, no payment is required.  You select the percent of sales you wish to be deducted for payment.  The larger the percentage, of course, the quicker the loan is paid off.

Fundation

Offers up to $150,000 for working capital loans, up to 2 years, and $500,000 for business expansion up to 4 years.  To expedite your credit check, Fundation requests real-time access to your bank.  Their interest rates range from 7.99% to 29.99% and are risk rated. A good credit score is definitely in your best interest.  You should receive funding within 3 days,

In addition to a good credit rating, to qualify you need to be in business 2 or more years, have 3 or more employees, and make, at least, $100K per annum.

Square Capital

This company makes loans available only to Square merchants; that is, clients who process their card transactions through their company, Square.  Eligibility is based on business volume and your history with Square.

Like Paypal, this company charges no interest.  A fixed charge is added to the amount borrowed, and a fixed percentage of money from your daily or weekly card sales is withdrawn as payment.  They may take a lesser amount if your business is experiencing an unexpected downturn.

Funds can usually be deposited to your bank account within 24 hours.

OnDeck

This popular company will loan as little as $5,000 up to $500,000.  Like most online lenders they require at least one year in business and a 500+ credit score.  Your short term loan can be from 3 to 6 months,  Long  term, from 15 to 36 months.

Based on your credit rating and their assessment, interest ranges from 13.99% to 36%. There is also a $20 monthly maintenance fee.  Payments are automatically drawn weekly from your business bank account.

CAN Capital

A calculator on this company’s website will tell you how much you can borrow and how much you will have to pay weekly.  You can borrow as little as $2,500, or as much as 150,000. Interest rates between 9.9% and 30%.  Additional fees are also charged.

IOU Central

You can get up to $150,000 from IOU Central.  They have no upfront costs, and they say they approve 85% of the loan applications they receive.  Their interest rate hovers at around 14%.  They, too, withdraw their payments from the borrower’s account on a daily basis.

Kabbage Competitors vs Lendvo

Now let’s talk about Lenvo.  They are also in the fast loan business, among many other things, but with  difference.  They approve loans based on the value of the borrower’s website.  How do they do this?

Since their clients are online businesses only, they can analyze the borrowers’ websites. They understand what they refer to as “the unique attributes and business models of online web businesses.”  They have ways to evaluate the borrower’s digital assets–a proprietary process that other Kabbage Competitors don’t have.  This allows them to study the traffic, the website visitors, search engine rankings, and the domain name’s value, in ways that Kabbage Competitors can’t.

Because they specialize in online businesses only, they can determine the business’s stability based on the borrower’s digital assets.  This allows them to do business with many online companies that other Kabbage Competitors are likely to refuse.

They will loan amounts up to $100,000, for periods of 30 days or up to 2 years, and usually release the funds in about 12 hours.  If the borrower needs financing to obtain a premium domain name, they’ll do that, too, along with expert guidance in acquiring the name desired.  Few companies offer this service.  Unlike most Kabbage Competitors, Lendvo cares less about credit ratings and more about analyzing and rating their client’s digital value.  Based on their research they are often able to offer loans of  higher amounts at lower rates.

Lendvo, unlike Kabbage Competitors, will also finance premium domain names.  Few companies specialize in domain names, and those that do usually demand large down payments.  Lendvo will work with as little as 25% down and offers competitive interest rates.

Decisions, Decisions

So there you have it.  You can readily see that the Kabbage Competitors are not all alike, and may vary in many ways.  But all those described above are legitimate companies with good track records.  If you’re looking for funding to expand your business, research carefully before you make up your mind.  Most Kabbage Competitors have experts available to help you.  Don’t be afraid to ask for their advice, if necessary.  Remember, their success depends on your success.

The Internet has placed the world at our doorsteps, opening up a world of opportunity unimagined just a few short years ago.  Stay-at-home moms are able to make a supplemental family income, or even support their families by working in cyberspace.

Hobbyists, inventors, and entrepreneurs are using computer technology in countless different ways, and the ability to receive funds almost instantly through the many online lenders becoming available is an important part of our evolving lifestyles.

But this growing field offers a wealth (no pun intended) of opportunities for scammers. We can’t stress enough, beware of scams.  Many are easy to spot; misspelled words, poor grammar, etc.  But some are so smooth you don’t even know you’re being scammed until it’s too late.