Kabbage vs OnDeck Small Business Loans| Best Online Lenders

Kabbage or OnDeck… On the market today, it has come to be known that small business lenders have several big competitors. Two of which has emerged as top; Market lenders Kabbage and OnDeck Capital.

Kabbage vs. OnDeck

Kabbage and OnDeck Capital are two of the very popular financing alternative to small business owners. So most times trying to figure out which is best source of financing can be quite hard. Therefore I have helped outline the differences between them to help you make the right decision.


Founded in 2009 as an online lender for online businesses, Kabbage expanded its market to include brick-and-mortar businesses in 2014. Since its founding, Kabbage has originated more than $3.5 billion in loans to more than 115,000 small businesses.

Loan Terms

The Kabbage product is designed as a line of credit for amounts from $500 to $250,000. Businesses can draw down what they need from the line of credit and have 6, 12, or 18 months to repay the amount borrowed. When the credit line is replenished, they can again borrow what they need.

The APR works out to be a range of 7.00 to 69.00 percent depending on qualification factors.


Kabbage does not rely heavily on personal credit scores for approving loans, choosing instead to focus on other data factors including sales volume, revenue, operating history, and social media activity. Generally, your business needs at least one year of operating history and $50,000 in annual revenue.

You must also have a business checking account managed through an online account that Kabbage can link to.

Application Process

The application process is streamlined with a minimal amount of information required about your business. A loan decision is made within an hour of submitting an application and funding can occur as soon as one business day. Borrowers are told to expect funding within one to three days.


Kabbage is well regarded as evidenced by reviews across the Web. Reviewers on Trustpilot give Kabbage an average 9.2 stars out of 10. The Better Business Bureau has assigned an A+ rating and reviewers on the site give Kabbage an average of 4.7 out of 5 stars.

Kabbage does get its share of negative reviews with many centered on its customer service. Both the positive and negative reviews of its customer service seems to hinge on the particular customer service rep involved – a good service rep gets a great review and a poor service rep gets a bad review.

The takeaway is, if you don’t find the service rep you are speaking with particularly helpful, hang up and call another one.

OnDeck Capital

Founded in 2007, OnDeck has a couple of years on Kabbage, but enough time to more than double Kabbage’s loan originations with more than $7.5 billion issued as of August 2017. The company was formed strictly as a lender to small businesses to provide a quick and easy way for under- and un-served businesses to gain access to capital.

Loan Terms

OnDeck offers short term loans up to $500,000 for 3 – 12 months. Its lowest APR is 9.00%. Borrowers who continue to borrow from OnDeck can receive lower APRs on subsequent loans. OnDeck charges an origination fee of 0% – 4%. OnDeck also offers a line of credit for up to $100,000 with APRs ranging from 14.00 to 40.00 percent.


OnDeck has slightly stricter loan qualifications than Kabbage. It does have a credit score requirement, but at 500, it is fairly low. The average credit score for OnDeck borrowers is 600.

OnDeck also relies more heavily on aggregated data and a proprietary algorithm to determine loan eligibility. It does require minimum annual revenue of $100,000 and at least one year of business operations. Borrowers cannot have any bankruptcies or tax liens.

Application Process

On Deck’s application and approval process is similar to Kabbage – a ten minute application and a loan decision within one hour. Loan approvals can come back as quickly as 15 minutes. Although many borrowers report receiving funds within one day, they are told to expect funding within one to three days.


Reviews for OnDeck are largely positive, with many customers raving about its streamlined application process and quick approvals. The average rating from nearly 900 reviews on Trustpilot is 9.4 out of 10 stars. Better Business Bureau reviews come in at 4.6 out of 5 stars.

OnDeck’s customer support also receives strong reviews for helping customers through the application process and its quick response to customer inquiries.

Kabbage vs. OnDeck

While Kabbage and OnDeck have many similarities, there are some important differences between them that you should consider before choosing your financing source.

Kabbage Ondeck
  • No personal guarantee required, so lenders cannot come after your personal assets
  • Lender may place a lien on your business assets for loans over $20,000
  • Fixed monthly payment
  • You can save some money by repaying loan early
  • No origination fee
  • Loans must be in the form of a line of credit
  • You can get a larger line of credit than from OnDeck (up to $150,000 vs. up to $20,000), but you can’t get as much money overall (up to $150,000 line of credit vs. up to $250,000 loan)
  • Personal guarantee required, which means lenders can come after your personal assets if you default
  • Lender can place a lien on your business assets
  • Payments made daily or weekly
  • If you decide to pay the loan off early, they’ll give you a 25% discount on remaining interest, but forgive it all entirely
  • Charges a 2.5 percent origination fee on all loans
  • Varying options as to loan length and type of loan
  • Option to get more money than from Kabbage (up to $250,000)

Final Thought

Overall, OnDeck offers more money if you need a larger sum, and more flexibility as to the form and terms of your loan.

Kabbage can be a good resource if you want more than $20,000, like the idea of a line of credit that you don’t have to pay back until you actually use it and feel confident you can pay back the loan in six months. The answer will depend on your needs.

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *