Small business lender Kabbage joins challenger bank club

Atlanta-based small business lender Kabbage, which has 400,000 business customers, is partnering with Green Dot Bank to offer checking accounts with no monthly fees and 1.1% interest on all balances.

Why should we care?
With a significant customer base already, the Kabbage checking account will surely deepen its relationships with customers and offer a window into spending patterns that will help the company personalize its offerings. As Kabbage checking account holders don’t need to be existing customers, it will also function as a customer acquisition tool. The company will apply cash flow analysis to checking accounts, suggesting best uses of funds based on spending patterns. Kabbage, which is worth more than $1 billion, joins other business lenders that have taken the plunge into banking, including BlueVine, which rolled out a checking account product last year. Kabbage also participated in the Paycheck Protection Program, issuing 225,000 approved loans for nearly $6 billion.