By Sarah Davis,
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Kabbage and OnDeck are among the most well-known and popular online lenders. Both have excellent reputations and were among the first disruptors in the alternative lending space. Following the 2008 crisis where banks could no longer lend small businesses a hand, online lenders helped fill the void in the financial market.

The automated application process online lenders have in place plays a huge role in their continued success. It allows clients to fill out an online form and see whether or not they qualify in less than 10 minutes. The eligibility criteria are also far lower in comparison to banks.

However, there are still many differences between companies in the online lending space. There can be great variety in terms of rates, penalties, customer service, and minimum qualifications. Let’s take a look at some of the differences and similarities between Kabbage and OnDeck below, one of the best lines of credit loan providers today.

Short in time? Quick Comparison

Kabbage OnDeck
Funding Time
Max Loan Amount
Loan Options
Customer Service
Analytics and Dashboards
Application Criteria
Review Full Kabbage review Full OnDeck review
Kabbage Pros

  • Smooth Application Process
  • Credit Bureau Reporting
  • Low Minimum Qualifications
  • Excellent Mobile Application And Dashboard
  • Short Funding Time
  • Business Credit Card

OnDeck Pros

  • Smooth Application Process
  • Credit Bureau Reporting
  • Fantastic Customer Service
  • Very Reputable Lender
  • Short Funding Time

Kabbage Cons

  • Low Maximum Range
  • No Term Loan

OnDeck Cons

  • Daily Payment Schedule
  • High Minimum Requirements

Main Differences Between Kabbage and OnDeck

While both lenders have similar functions, they have distinct target markets and unique loan products with specific terms and conditions. The most significant distinction is that Kabbage is a 100% fully automated lender. At the same time, OnDeck requires a phone call with a dedicated loan advisor for a slightly more manual application process.

While it might seem like a slight difference, it can be very profound: OnDeck provides a personalized approach for its customers, while Kabbage operates purely on an algorithmic method. With Kabbage, you link up your bank account or accounting software, and the process is automated depending on some other criteria (credit score, annual revenue, cash flow, etc.). It is not an advantage or disadvantage, just a different mode of operation.

The target markets of both lending providers also differ. OnDeck primarily caters to businesses that have an impressive track record with a higher credit rating. In contrast, Kabbage tends to accept a broader range of applicants. OnDeck offers higher loan amounts than Kabbage, but its lending process and eligibility criteria tend to be harder to meet.

Another big difference is that Kabbage fees are paid monthly while OnDeck fees are paid weekly or daily. It can be an advantage or a disadvantage, depending on the business. However, with the weekly and daily repayment schedule, loan applicants must ensure that they always have the appropriate funds in the account to avoid a late payment penalty. The benefit is that the daily repayment schedule can be superior for credit reporting in certain instances.

Kabbage vs OnDeck Loans Compared


Kabbage offers a business line of credit with 6, 12, and 18-month repayment terms, while OnDeck has a 12-month repayment term for a line of credit loan, and 24 month period for term loans. A business line of credit loan can be used as you need it for any purpose. The benefit is really that the line is available if something comes up. The Kabbage line of credit extends to $150,000, while the OnDeck line of credit only extends to $100,000, and this amount may not be enough for certain businesses. Kabbage only offers a single kind of product, being at a disadvantage compared to OnDeck, which offers both line of credit and term loans.


While Kabbage only offers the business line of credit, OnDeck offers both a line of credit loan and a term loan. A line of credit and a term loan are not the same. The term loan is a fixed loan with specific payment periods. For instance, you might want to take out a loan to pay for restaurant equipment. You could get a $20,000 term loan upfront with a fixed repayment schedule: the purpose of the loan is fixed. A line of credit is an available ‘line’ that can be drawn upon as needed. Usually, the line of credit is taken out on a “just in case” basis; the term loan is taken out for a particular reason – such as the purchase of fixed assets, inventory, or equipment.

Winner: OnDeck – offers more loan options in comparison to Kabbage.

Products Offered Line of Credit Line of Credit, Term Loan
Loan Amount Max $1,000 – $150,000 $6,000 to$100,000 Line of Credit
$5,000 to $250,000 Term Loan
Funding Time Same-day, Within 1 Business Day Same-day, Within 1 Business Day
Loan Length 6, 12, or 18 months 12 Months (Line of credit)
12 – 36 Month (Term Loan)
Application Speed 10 Minutes 10 Minutes
Automated Application Fully Automated Partially automated; necessitates a phone call with a loan advisor
Repayment Schedule Monthly Daily or Weekly

Minimum Qualifications


Practically any small business could qualify for the Kabbage line of credit. All that is required is a year in business with $50,000 in annual revenue. It should be enough for most businesses, Also note that for loans over $100,000, Kabbage requires three years in business. This fact is not well advertised and could misguide applicants. For both Kabbage and OnDeck loans, a personal guarantee and a business bank account are required. Of course, this is the case with practically all online lenders. However, OnDeck will additionally file a UCC-1 blanket lien upon loan acceptance. Kabbage has some restrictions and does not loan funds to nonprofit organizations, Non-US businesses, businesses with large outstanding debts with other lenders, businesses dealing with gambling, marijuana/CBD, firearms, financial institutions, and lending businesses.


Compared to Kabbage, OnDeck has far more challenging minimum criteria. What’s more, is that OnDeck very recently updated its qualifications to make them even higher. The minimum annual revenue is $100,000, and the personal FICO score of the borrower should be over 600, and a business checking account is a must. The requirements for the OnDeck term loan are identical to the ones for the line of credit loan. I need to note here that OnDeck does not provide loans to Nevada, South, and North Dakota businesses. It does not lend funds to businesses involved in adult entertainment, drug dispensaries, firearms, gambling, fortune-telling, civic organizations, nonprofits, government organizations, money service businesses, and rooming and boarding houses.

Winner: Kabbage – its minimum qualifications are easier to satisfy in comparison to OnDeck.

Kabbage Line of Credit
OnDeck Line of Credit
Minimum Credit Score None (540 recommended) 600
Minimum Time in Business 1 Year (3 if above $100,000) 1 Year
Minimum Annual Revenue $50,000 $100,000
Personal Guarantee Yes Yes (+UCC-1 Lien)
Collateral No No
Business Bank Account Yes Yes

Loan Rates & Penalties Compared


Kabbage has adopted the Smart Box model and is now completely transparent with its fees. The estimated APR for Kabbage loans is 24% – 99%. While this might seem like an extensive range, this is how the industry works. There are many loan options and loan durations to take into account. And there are many businesses with different credit histories to account for. When considering rates and penalties, there are many reasons that the APR is misleading. A lender with low eligibility requirements will facilitate less creditworthy borrowers, and to offset this risk, the interest rate will naturally be higher. So to say a borrower has a higher average interest rate is misleading unless all other factors are taken into account.


When it comes to rates and penalties, OnDeck is undoubtedly ahead of the curve. OnDeck was a pioneer in using the ‘Smart Box’ model. It is a straightforward but valuable model that lets customers know how much they will be paying on their loans. This model allows for easy comparison of various loan types with an all-inclusive APR rating. OnDeck charges a 0 – 4% origination fee on its term loans and has 47.14% APR for its line of credit loan. This origination fee is often reduced for return clients. OnDeck has a very loyal following, and 80% of people return to OnDeck for a second loan.

Winner: OnDeck – The rates are a little cheaper on average, but by a tight margin.

Kabbage Line of Credit
OnDeck Line of Credit
Origination Fees No No
Maintenance Fee No $20 (monthly)
Prepayment Penalties No No
Withdrawal Fees No No
Late Payment Penalties Yes N/A
Average APR Range 19.56% – 213.84% (1.5 – 10% each month) 11% – 63% (weighted average is 47.14% APR)

Which Lender is Cheaper?

Due to the complexities of understanding loan interest rates, it can be hard to give the exact figures of the loans provided by Kabbage and OnDeck. Different lenders use different criteria to evaluate loans. It’s best to look into each lender’s distinct fees and charges to make an informed decision. The APR can always range from around 9% – 99%.

There is little standardization between lenders in terms of how fees are calculated. It helps to know that the lowest rates are very seldom granted, and then only to the very best of applicants. An APR between 20% – 40% is far more common.


Kabbage only has one all-encompassing fee, which is a huge advantage. APR rates alone can be misleading, as other fees can skew this figure. Kabbage prefers to use the term “monthly fee” for all charges so you can understand precisely how much you will be paying each month. With Kabbage, there are no prepayment penalties, no origination fees, and no maintenance fees. Just one single monthly rate, and it depends on the amount you borrow from your approved line of credit. Generally speaking, the Kabbage monthly fees are 0.25-3.5% for a 6-month loan, 0.25-2.75% for a 12-month loan, and 0.25-2.50% for an 18-month loan.


OnDeck displays its average APR fees on its main page. However, this does not mean cheap. The weighted average APR for OnDeck term loans is 47.14%, while the weighted average for the lines of credit is 35.2%. Similar to Kabbage, you can easily see what you will be paying each month. OnDeck charges origination fees and maintenance fees for its line of credit loans.

Winner:  Tie – When all is said and done, OnDeck is the cheaper lender on average, but Kabbage has the most uncomplicated fee structure to understand.

Kabbage vs. OnDeck Application Process


Kabbage has a 100% automated application process that makes the entire application more streamlined. Kabbage wins out when it comes to the application process. OnDeck only does a soft pull on your credit rating during the application process. In contrast, Kabbage does a soft and then a hard pull on your credit score, and in some cases, a hard pull can hurt your credit score, even if it’s not very serious. To apply for a Kabbage loan, you will need the following:

  • Business name, type, and industry you are in
  • Business tax ID
  • Social Security Number
  • A Business Checking Account
  • Link to sync up with your accounting software (to check the last three months of records)


OnDeck also has a quick application process that is partially automated. OnDeck will need to give you a call for additional verification and information. Additionally, you will have to supply more information with OnDeck in comparison to Kabbage. OnDeck issues larger term loans for more reputable borrowers and needs to verify them. Here is what you need to apply for a loan with OnDeck:

  • Business tax ID
  • Voided business check
  • Three months of business bank statements
  • Copy of your driver’s license
  • Social Security Number
  • Estimated annual gross revenue
  • Average bank account balance
Winner: Kabbage – smoother application process, though OnDeck also rates very highly in this regard.

Underwriting Process Comparison

Once your applications are submitted, the next step is for the online lenders to review your credentials and determine loan eligibility. It is known as an underwriting process, and here is what goes on with both Kabbage and OnDeck.


With Kabbage, the loan underwriting process is entirely automated. Usually, if no additional data verification is needed, you can get approved within minutes. After approval, you’ll be presented with the terms and conditions of the loan, and you then choose to accept/reject the agreement. Should you accept, the funds will be delivered to either your business bank account or a PayPal account (whichever you prefer). After the offer has been accepted, Kabbage pulls a hard credit check on your score. You’ll also need to sign a personal guarantee, as all Kabbage loans are secured by business assets. American Express National Bank issues all Kabbage loans.


With OnDeck, the underwriting process is a little more rigorous. After filling out the outline form and talking to a loan advisor (also sending the required documentation), OnDeck pulls a soft credit check. OnDeck places a more considerable emphasis on the credit score in comparison to Kabbage. If you are eligible for a loan, you will be sent a Smart Box with the loan terms and conditions. You then accept and sign a personal guarantee. OnDeck then files a UCC-1 blanket lien on your business. With OnDeck, the loans are issued by Celtic Bank, registered in Utah, and a member of the Federal Insurance Deposit Corporation (‘FDIC’).

With OnDeck, the loans are issued by Celtic Bank, which is registered in Utah and a member of the Federal Insurance Deposit Corporation (‘FDIC’). Kabbage loans are also underwritten by the same bank – Celtic Bank.

Winner: Kabbage – The underwriting process is a little more streamlined.

Customer Reviews & Feedback

Customer feedback is essential to all service businesses, so it is important to see what customers of Kabbage and OnDeck think about these lenders. Both businesses are registered with the Better Business Bureau (‘BBB’) and the Innovative Lending Platform Association. OnDeck has a better rating with the BBB as an A+ business.


Kabbage has excellent reviews on multiple review sites, with a current 3.9-star rating on TrustPilot, with over 6,680 reviews. The most commonly cited positives are the fast funding time (quoted as less than 7 minutes from application to funding) and the ease at which the line of credit can be extended. Some of the negative notes are on the high-interest rates, which are justified for such low qualifying terms. Because Kabbage rolls all fees into one monthly package, customers stated that they are satisfied with what they have to pay and are not surprised by unexpected fees. Kabbage is also an excellent provider to use for businesses looking to increase their credit score quickly. The Kabbage customer support is very responsive and is easy to call or email; they usually respond to all queries within 24 hours.


OnDeck has an exceptionally high rating by its clients, as it emphasizes customer service. At this time, OnDeck has a 4.9-star rating on TrustPilot, with over 2,880 reviews. Many clients noted that they liked the personal loan advisor help the company assigns, as they find it helpful to get expert help. 80% of customers end up returning to OnDeck. The most common praise of OnDeck concerns the professionalism of its support team, as they are knowledgeable, helpful, and professional. Some clients noted the higher rates and daily payments as unfavorable, but generally, the OnDeck online reviews are raving.

Winner: OnDeck – probably the most reputable and well-liked online lender in the marketplace. Customers love this provider.

When to Choose Kabbage

Kabbage is ideal for a small business on the rise and needs a revolving line of credit as an extra safety net for general expenses. The advantage of having a line of credit is that you can pay it off and use it over and over and over, as opposed to the term loan, which is taken out for specific purposes.

Kabbage provides small business owners with up to $150,000 line of credit after a 10-minute application process, and the funds can become available instantly. This kind of capital can help accelerate the growth of a new business. The eligibility requirements are so low that practically anyone can qualify, and this is where Kabbage truly shines: simple, no-hassle finance for nearly every small business.

In sum, Kabbage is the default option for a small business just starting and does not have a strong credit history or high annual revenue. The line of credit is the perfect form of security against any issues that could arise during business expansion. Another benefit of Kabbage is its slick technology – the mobile application, desktop application, and dashboard are very intuitive with easy integration.

When to Choose OnDeck

OnDeck is perfect for small businesses that have some experience. They accept businesses with a 1-year history, $100,000 in annual revenue, and a minimum FICO score of 600. It means that only established businesses in a good financial state will get the opportunity to benefit from OnDeck.

Still, OnDeck is the best option for small businesses that have a profitable long-term model. It is due to OnDeck’s impeccable customer service that is unmatched by any other provider. Also, OnDeck offers lower rates than the vast majority of other online lenders.

The OnDeck application process is streamlined, and on top of the line of credit, OnDeck also offers the term loan. If you have a specific purpose that you want to use the capital for, OnDeck is a great option. It can include the purchase of fixed assets or having a good amount of working capital. You can also take out a term loan and a line of credit if this is what your business needs.

Bottom Line: Kabbage and OnDeck are Excellent Online Lenders

Both Kabbage and OnDeck are top-rated providers in the online lending space. They are separated mainly by their eligibility criteria. If you are a new business just starting and are in a poor financial state, then Kabbage is perfect for you. If you are an established business in a better financial state, then OnDeck is a better option.

Before you make a final decision, consider all the factors and make a good decision for your business’s health. Keep in mind that both lenders are not the cheapest available – you can expect to pay significant interest rates on the loans you do take out. I advise you to read the terms and conditions of each loan (especially the fee breakdown) before you accept any loan offer. Saying this, if you are really looking for a no-hassle loan quickly, then OnDeck and Kabbage are both ideal.

If you are not sure of these two lenders, we have plenty of alternative online lender options. We can also walk you through the process and help you understand the complex arena of interest rates and payment conditions. It’s easier than you might think.

Sarah Davis
Sarah Davis
Sarah Davis is a business executive specializing in mergers and acquisitions, corporate finance, and international law. She achieved her MBA from Cornell University after completing a legal undergraduate at UC Berkley. Sarah runs her own business consultancy firm in tandem with working alongside the FinImpact team.

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