Kabbage, "Kabbage PPP Results: A Historic Feat for FinTech" (updated as of August 8, 2020), pp. 1–3
Summary
Kabbage report on its Paycheck Protection Program (PPP) results, updated as of August 8, 2020, the end of the PPP extension. It states that Kabbage processed $7 billion in PPP loans for nearly 300,000 small businesses and is the second largest PPP lender in the country by application volume. It says over 75% of all approved applications were processed without human intervention or manual review, and the median time from applying to approval was 4 hours. The report also includes a profile of Kristy Kowal, an independent contractor who received a PPP loan through Kabbage.
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“Kabbage, ‘Kabbage PPP Results: A Historic Feat for FinTech’ (updated as of August 8, 2020), pp. 1–3.”
Original at newsroom.kabbage.com. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/kabbage-kabbage-ppp-results-a-historic-feat-for-fintech-updated-as-of-3ac0867562/
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Kabbage
PPP Results:
A Historic
Feat for
FinTech Updated as of August 8, 2020, the
end of the Paycheck Protection
Program (PPP) extension
The pandemic is a reckoning for small businesses and the very fabric of our financial system in America. The smallest,
most vulnerable businesses often struggle to receive adequate financial services in the best of times, and now in the
worst of times, traditional banks are not there during this crisis. FinTechs were.
Kabbage processed $7 billion in Paycheck Protection Program loans,
providing support to nearly 300,000 small businesses and preserved an
$7
estimated 945,000 jobs across Main Street America. This includes all types
of businesses, from restaurants, gyms, and retail stores, to also zoos, shrimp
boats, and beekeepers; toy factories, sheep farmers, and swim schools.
Billion to
297,587
Overall, Kabbage’s PPP loan average
is $23,546 with a median of $12,775
We served the most vulnerable of businesses represented as over 92% of customers,
all loans were under $50,000, the SBA’s smallest tier of measurement, for
an average of $12,976. Overall, Kabbage’s PPP loan average is $23,546 saving
with 50% of all loans under $12,775. While many large banks closed their
PPP applications in May, we kept processing applications through the
extended program in August to ensure that small businesses had maximum
945,000
access to capital in this uncertain public-health emergency and economic
crisis. During the last week of the program, we experienced a surge of
jobs
demand processing an additional 46,000 applications for nearly $900
million, showing the appetite for the Paycheck Protection Program remains
strong.
PPP Applications Approved
Kabbage
297,587
is the second
largest PPP
lender in the
country by
application
volume.
Kabbage PPP Report 2
Working with Small and Micro-Businesses
Kabbage customers accessed nearly $3 billion in working capital loans in 2019, driven by almost 60,000 new
customers. In just four months, we delivered more than double the amount of funding ($7B) to roughly five-times the
number of new customers (297K). While banks and other providers limited their processing to existing lending
customers, new customers represented 98% of all Kabbage’s approved applications. Perhaps, more importantly, we
served the smallest of small businesses, sole proprietors, and non-employer firms.
Roughly 69% of our PPP
67% of our PPP customers 90% of our PPP customers
customers had only one
were self-employed had 10 or fewer employees
employee
“Helping restore nearly one million jobs has been the
greatest privilege to date for me and the entire Kabbage Lending Breakdown
team,” said Kabbage co-founder and CEO Rob Frohwein.
Kabbage Direct
“We’re now the second largest PPP lender in the nation by
application volume. Our technology platform, Customers Bank
commitment to connectivity, and automation allowed us Cross River Bank
to reach these milestones with a fraction of the resources
accessible to lenders with trillions of dollars in assets, Footnote: Kabbage issued PPP loans directly as an SBA-approved lender, and in
partnership with Customers Bank (PA) and Cross River Bank (NJ) to serve small
once again demonstrating the power of FinTech.” businesses in all 50 states and U.S. territories.
Automation is Key
Thanks to our commitment to data and technology to drive automation, over 75% of all approved applications, and
more than 90% of self-employed applications, were processed without human intervention or manual review. Overall,
our median time from applying to approval was only 4 hours.
Without large back-office staffing, automation has been the key to our success. On average, for every 790 employees
at major U.S. banks, Kabbage has one. Prior to the PPP, Kabbage had never processed a loan for the SBA. In less than
two weeks, Kabbage entirely restructured its lending platform and developed new automated systems to ingest,
analyze, verify, and approve PPP applications, distilling a complex and paper-heavy application into a logical, easy to
follow, process built around advanced data analysis. As a result, it became a top-two lender in the largest program in
the Administration’s history.
Kabbage PPP Report 3
Number of Employees
For every
~790
employees
at major
U.S. banks,
Kabbage
has one.
Industry Breakdown
Our top-performing loans by industry paint an interesting picture of the importance and the diversity of small
businesses to our economy. Professional services, personal care services, and restaurants comprise the top three
industries. Outside of the top three industries, healthcare providers, freight, and home repair services were all
considered essential services and faced both decreased demand while incurring significantly increased operational
costs.
Number of Borrowers
Average Loan: Average Loan: Average Loan: Average Loan: Average Loan: Average Loan:
$20,229 $13,265 $29,815 $18,172 $40,662 $29,815
Kabbage PPP Report 4
One third of loans
went to businesses
in zip codes with an
average household
income of less than
$50,000
Geography
As an online platform, Kabbage reaches all types of businesses in all corners of the nation which is critical to
successfully fulfilling Congress’s intent to serve businesses through the Paycheck Protection Program. Throughout the
program, we provided over $1.98B to businesses in low and moderate-income (LMI) areas. More importantly, of the
total estimated jobs saved, over 257,000 were with small businesses in LMI areas and traditionally underserved
communities. This is critically important as recent Federal Reserve data shows that Black-owned firms have been twice
as likely to shutter during the pandemic.
In addition to serving businesses in all 50 states, Puerto Rico, Guam, and the U.S. Virgin Islands, Kabbage served small
businesses in some of the most rural and remote communities as well as in critical private infrastructure like rural bus
services and river ferry lines that help keep us connected. Moreover, we were able to provide $166M of much-needed
capital to America’s farmers, saving nearly 27,000 jobs.
Kabbage PPP Report 5
Kristy Kowal
Olympic Medalist and Athletic Consultant
Kristy Kowal is a storied Olympic athlete who, since retiring from
competing for team U.S.A., began a consulting career joining the
millions of other independent contractors in America. Kristy was on
the National Olympic Team for over 10 years, holding eight
American records, one World record and she won a silver medal in
the 2000 Olympic games for the 200-Meter Breaststroke. Now as
an educator and athlete-development specialist, Kristy provides
support for young athletes and their families, teaching them how to
face challenges, overcome disappointment, and find success
despite failures along the way.
“COVID-19 resulted in pools around the country closing down, and
as a result of that, I have not been able to conduct swim clinics or
provide swim instruction in person. All of the scheduled clinics,
camps, lessons, and speaking engagements I had are canceled,
and there is no set timeline when I will be able to resume working,”
said Kowal, who has since adapted given the new normal of life.
“During the crisis, I began hosting weekly webinars for parents of athletes called The Carpool Lane, as well as
conducting workshops for parents called Parents in the Game: Supporting from the Sidelines. I have also spoken to
athletic teams throughout the country via team Zoom calls.”
Kristy originally applied for Pandemic Unemployment Assistance (PUA) in California, but was denied three times and
ran into walls with the Employment Development Department (EDD) after two and a half months of trying to complete
the process. It wasn’t until a friend shared her success applying and qualifying for a loan through Kabbage as an
independent contractor that Kristy found the relief she needed.
“As a self-employed individual, these last few months have been incredibly stressful, having a minimal income, and
using savings to pay rent and bills. With the uncertainty of when I will be able to return to work full time, receiving a PPP
loan through Kabbage has provided me with the peace of mind that I will be able to continue with the work I have
spent the last 20 years developing, once it is safe to do so.”
Kabbage PPP Report 6
Access to capital has been far too complicated and
inequitable for far too long; but at Kabbage, we’re driven to
simplify life for all small business owners. The pandemic and
the early challenges of the Paycheck Protection Program only
highlight the need for financial products, policies, and
programs tailored to the smallest of small businesses.
While many small businesses were able to adapt their
business during COVID-19, many were not. The small
businesses that account for almost half of the nation’s GDP
will need continued support through the duration of the
pandemic so we may rebuild the health of our communities
and the U.S. economy.
Kabbage PPP Report 7
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