B2B Payments

Small Businesses Flocking To Mobile Loans, Kabbage Finds

Analysis of borrowing behavior among small businesses suggests SMB borrowers are increasingly turning to mobile devices to access funding, according to new data from Kabbage.

The SMB lending platform announced news on Wednesday (March 28) that a survey of nearly 150,o0o small businesses revealed a more than 360 percent increase in the number of loans accessed via mobile device between April 2014 and February 2018.

The value of financing accessed via mobile device increased during that time too, by more than 1,220 percent, Kabbage said.

According to the company, the statistics suggest small businesses see mobile devices as a tool to meet their demand for fast, convenient financing.

“The growth of mobile lending is evidence of an enormous change occurring in this industry,” reflected Kabbage Chief Revenue Officer Victoria Treyger. “Small business owners are increasingly digitally savvy and are adopting new technologies faster than ever before. Lending is no different.”

Treyger added that Kabbage is hoping to embrace and fuel this trend by meeting “small business owners where they are.” The company offers a mobile app through which borrowers can apply for and access small business loans.

In addition to offering mobile services, Kabbage has recently focused on diversifying its financing sources. Late last year, the company announced it secured a credit facility from Credit Suisse. The $200 million revolving credit facility would help the company focus on expansion and enable loans with longer terms to SMBs, Kabbage said at the time.

The company also previously partnered with Santander UK, which agreed to license the Kabbage Platform to increase its own small business lending operations.

But the platform has faced barriers to expansion. Last November, a small business borrower sued Kabbage and Celtic Bank in a case challenging the definition of a “true lender,” an increasingly unclear term in an era in which borrowers access financing on one platform and receive funds from a third party.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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