Image of Rob Frohwein provided by Kabbage
US fintech Kabbage launches new payment service to help small businesses get paid quicker
Kabbage Payments is one of a number of services being launched by the US fintech.
Kabbage, a US fintech backed by Softbank which uses AI-based algorithms to help work out the terms of small business lending, is launching a payments service which it says will cut the time it takes small businesses to get paid from 90 days to 24 hours.
Kabbage Payments, which is being launched following a test launch, is one of a number of products being launched by the US fintech in the coming months, geared towards small businesses.
Kabbage says two thirds of its more than 200,000 customers rely on invoicing to receive payments and that it can take as long as 90 days for them to get paid.
The US fintech says that its new payment service will be able to cut the time down to 24 hours.
Kabbage Payments works by allowing customers to create a unique URL, which customers can then use to send payment requests through text, email or the web to collect card payments quickly.
Kabbage says the technology eliminates the need to manually create new accounts, open new payment orders and duplicate work for recurring invoices.
Other features of Kabbage Payments include a dashboard, free customer support and no monthly fees for invoices.
"Since 2011, we’ve helped hundreds of thousands of small businesses access over $8 billion (£6.19bn) in funding. We know first-hand a primary need is to cover cash-flow gaps while waiting to be paid,” said Kabbage CEO Rob Frohwein.
“Kabbage Payments not only expands our suite of products, but the very definition of our company. We deeply believe in the mission of small businesses and understand what they need to succeed—namely, more time building their businesses and less time worrying about cash flow."
Kabbage, valued at more than $1 billion (£777m), launched in 2009 and is among a number of startups which uses digital tech to lower lending costs and offer credit quicker than traditional banks.
Kabbage, which has lent billions to small businesses, has raised $250m (£193m) from Softbank last year, helping it to add lending products and other types of financial services.
Other investors in Kabbage include BlueRun Ventures and Mohr Davidow Ventures.