learn more / compare funding /

Business Loans
vs. Personal Loans

Kabbage business loans are different from personal loans because they’re designed to help entrepreneurs make investments. More than 80,000 businesses have taken advantage of working capital through Kabbage to keep their businesses growing and thriving.

How does the value of loans differ?

Reviewing loans based on APR is one method of comparison, but it’s important to also take into account the purpose of loans and the returns they provide.

Kabbage Loans

Kabbage customers often use their lines of credit to make investments in their businesses. For instance, if a customer purchases equipment such as a vehicle, this asset can provide a profitable return instead of simply depreciating.


kabbage loan

$5,000

"My business invested in new workstations which resulted in a $1,709 profit due to increased productivity."

loan servicing

  • +$5,000 Loan
  • -$5,000 Loan Principle
  • -$1,000 Loan Charges2

cost of funds

-$1,000

apr3

-36%

cost of funds

  • -$1,000 Loan Charges2

income growth

  • +$1,709 Business Income Generated

cost of funds
(adjusted)

+$709

rate of
return

26%

Personal Loans

Typically, when a consumer takes out a loan for personal use, the purchase is not intended as an investment. In the example below, a personal loan for a vehicle decreases in value over time, adding to the overall cost of the loan.


personal loan

$5,000

"A year after using a personal loan to purchase a delivery truck for $5,000, I sold it for $3,500 due to depreciation."

loan servicing

  • +$5,000 Loan
  • -$5,000 Loan Principle
  • -$1,000 Loan Charges2

cost of funds

-$1,000

apr3

-36%

cost of funds

  • -$1,000 Loan Charges2

income growth

  • +$1,709 Business Income Generated

cost of funds
(adjusted)

-$2,500

rate of
return

-92%
Ready to get started?