Kabbage vs. OnDeck | Business Loan Comparison

Kabbage vs. OnDeck

Whether your business is new, in a growth phase, or just needs an infusion of quick cash, a business loan may be a great option. Not all lenders offer the same business-friendly fees and policies, though. That’s why we’re giving you a side by side comparison of two top options, Kabbage vs OnDeck.
Best Business loans

Introduction to different types of business loans

There are a few different types of business loans. The Small Business Administration offers loan backing through some lenders for amounts from $5,000 to $5 million. APRs range from 5% to 13% but the application process can take three weeks to several months. You’ll need a great credit history to qualify.

A traditional business loan between $1,000 and $500,000 with repayment terms of about five years is another option. There’s no collateral required, and interest rates range from 7% to 30%, depending on your business’ credit score and revenue levels.

A business line of credit works a lot like a credit card.  You don’t have to have perfect business credit to qualify. Approval could be instant. It takes just a few days to get the money. Typically, the loan needs to be repaid within six months to a year. This type of flexible funding is great to have on hand in case of an emergency.

Merchant cash advances offer a lump sum of money. To pay it off, you authorize the lender to take a certain percentage of each of your sales automatically. APR rates start at 15%, but could easily go into triple digits depending on the lender’s fee structure. Repayment terms are usually between four and 18 months. For businesses with poor credit or a short history a merchant cash advance may be the only viable option.

Here, we’ll take a close look at two established and highly-rated lenders; Kabbage and OnDeck. Both have business-friendly fees and policies. Read on to find out which option will best meet your business needs.

Lines of Credit

Credit lines from Kabbage

For businesses that need flexible, on-demand access to money, Kabbage is a great choice. This lender structures loans as credit lines, so you won’t pay interest on money until you need it. There are no hidden fees.

There are no upfront or application fees associated with Kabbage loans. You can find out whether you are approved in about ten minutes and get instant access to a line of credit between $2,000 and $250,000. You’ll have between six and 18 months to repay the amount you borrow.

Credit lines from OnDeck

You can choose from a conventional business loan or line of credit with OnDeck. Their fees are transparent, and you have several repayment options.

Approval is instant and funding takes just 24 hours. In some cases, you could receive your money instantly or on the same day that you apply. OnDeck loans between $5,000 and $500,000 via a traditional business loan or up to $100,000 with a line of credit. Interest rates go as low as 5.99%. Repayment terms are six to 36 months. OnDeck charges a one-time origination fee.

History and Reviews

Kabbage

The company is 10 years old and was started by three financial entrepreneurs as an option for business owners looking for an alternative lender. Their goal is to connect business owners with capital instantly, and their platform does a great job of providing a reliable automated application system that easily integrates with systems businesses already have in place.

In 2015, Inc. put them on their list of the 500 fastest-growing private companies in the United States.

Kabbage has 83 customer reviews on the Better Business Bureau (BBB) website with an average of 4.25 out of five stars. They have an A+ score from the BBB. Reviewers note that the customer service team is friendly and responsive.

OnDeck

They’ve been in business since 2007, and OnDeck uses a proprietary credit scoring system to qualify applicants. This lets them make real-time decisions and get money to small businesses quickly. They also lend in Australia and Canada.

OnDeck has an A+ score with the Better Business Bureau (BBB) and 3.5 stars out of 5 from 83 customers who wrote reviews on the BBB website. They receive high praise for their customer service and fast funding options.

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