Atlanta-based fintech unicorn Kabbage Inc. is enabling an effort by Chinese e-commerce giant Alibaba to offer credit to U.S. buyers on its original platform.
Alibaba.com, a digital marketplace that grew by allowing customers to source online from China, began the company’s ascent into a publicly traded behemoth touching nearly all segments of online commerce. Its holdings include the popular shopping sites Tmall and Taobao, as well as Ant Financial, which offers financial services including the Alipay platform.
Kabbage, which approves small business loans in minutes through its cloud-based platform, is playing to its strength in vetting U.S. companies in this deal.
Under Alibaba’s new Pay Later program, Kabbage’s platform will approve U.S. buyers for up to $150,000 in a line of credit from which they can pull funds in six-month term loans with interest rates as low as 1.25 percent. It’s all done without any transaction, origination or maintenance fees.
“Financing at the point of sale requires a fully automated solution that can handle the immense volume of daily transactions that occur on Alibaba.com,” said Kabbage CEO Rob Frohwein in a news release. “We are incredibly impressed with the service and value that Alibaba.com delivers to American businesses and want to do all we can to support their important mission.”
Kabbage has originated billions in loans, becoming a major engine for its partner banks, including many from Europe. The company has seen its valuation soar past $1 billion with investments including a $250 million infusion by Japan’s Softbank Vision Fund aimed at driving global growth.