Kabbage Inc., US based fintech headquartered in Atlanta, has pioneered the first financial services data and technology platform to provide fully automated funding to small businesses in 7 (!) minutes.
Since launching in Atlanta in 2009, Kabbage has grown to provide $1 billion in funds annually to consumers and SMEs, making it one of the fastest-growing companies in small business finance. Kabbage substantially speeds up the process of loan application and approval, allowing SMEs with an existing business account to get a loan of USD 2,000 to USD 100,000 within a few minutes based on real-time business data.
Kabbage’s case shows a good example how banks and non-banking lenders can cooperate in launching lending products for SME customers.
At the end of 2015 Kabbage and ING announced cooperation. ING has taken an equity stake in Kabbage. The investment is part of a financing round in which Kabbage raised USD 135 million of capital.
And additionally the companies launched a common pilot in Spain, offering small and medium enterprises (SMEs) loans up to EUR 100,000. Kabbage’s automated loan application and approval process is both accelerated and simple for customers. It makes use of full credit scoring and real time risk monitoring and allows SMEs with an existing business account to get a loan within ten minutes, based on real-time business data.
“This partnership shows we are dedicated to creating a differentiating customer experience. After a successful launch, we will look into expanding the offering. This initiative perfectly fits our strategic priority to increase the pace of innovation,” Ralph Hamers, CEO of ING, said. “The cooperation is also in line with ING’s innovation approach to launch new services via both own initiatives and by working together with and investing in fintechs and startups.”
“As financial institutions embrace new lending technology, we see that platforms like Kabbage are interesting for them to provide a superior experience to their customers,” said Rob Frohwein, Kabbage co-founder and Chief Executive Officer. “We are incredibly proud of our partnership with ING, and most importantly, we are thrilled to serve the small and medium businesses powering the economy in Spain.”
Rob Frohwein, Kabbage co-founder and CEO: “This funding enables us to continue to set the industry standard through platform lending, bringing our seamless user experience to millions of customers around the world directly and through our platform partners. ING is a global leader with deep expertise across financial services and technology to further develop our trajectory.”
Also in 2016 Scotiabank, Canada’s third-biggest lender, announced partnership with Kabbage to enable small businesses to take out loans of up to C$100,000 ($78,290) online in as little as seven minutes.
Scotiabank said it would initially offer the new service to more than 100,000 small business customers in Canada and Mexico that are currently not borrowing from the bank.
Santander UK, a subsidiary of Grupo Santander, one of the ten largest banks in the world, in 2016 announced its intention to license the Kabbage Platform to power automated SMB lending throughout the United Kingdom.