Kabbage Checking gives small businesses flexibility with full functionality
Kabbage has announced the launch of its new current account solution targeting small businesses. The new offering gives small businesses access to digital banking services, including e-wallets, free ATM access and bill payment.
According to Kabbage, these are the same capabilities, conveniences and security that businesses can expect from a traditional checking account. This offer is free. And it offers an Annual Percentage Return (APY) of 1.10%, touted as one of the highest rates in the industry.
Interested companies can apply for a Kabbage checking account regardless of their previous relationship with Kabbage. In addition, no opening or maintenance fees are required.
“Kabbage Checking is a new banking service designed to give these small businesses the advantage of earning more, saving more and growing their business faster without sacrificing anything they expect from a bank” noted Kabbage President Kathryn Petralia.
Applying for a checking account according to Kabbage takes less than 10 minutes. All you need is some basic information about you and your business.
Kabbage checking accounts will be issued by its partner bank Green Dot Bank. Kabbage also allows businesses to connect other business services such as Intuit QuickBooks, eBay, Amazon, and PayPal.
An overview of the services
Kabbage’s checking account is insured by the Federal Deposit Insurance Corporation (FDIC) and is insured up to $ 250,000. Within one account, businesses have the option of opening up to five portfolio sub-accounts to help them manage multiple revenue streams and track their savings.
You can make deposits into the checking account of any of Kabbage’s 90,000 participating retailers and service centers nationwide. Kabbage Debit Mastercard will allow you to withdraw money through a network of free ATMs. You can also start using your virtual card number as soon as you open your account. This allows you to make purchases online while you wait for your card to arrive.
Customers of the accounting-control service have the option of using other Kabbage products as well. This includes Cabbage Information, Kabbage Payments, and Kabbage Funding to access cash flow analysis and forecasts, make payments, and prevent accounts from going negative.
The company notes that this will strengthen its existing set of complementary solutions, which, when combined, give businesses an immediate technological advantage that is historically reserved and elusive even for large companies. The result, according to the company, will give small businesses access to unified cash flow tools in minutes, without any upfront cost or commitment.
Kabbage Checking is also expected to start supporting wire transfers and remote mobile deposits. These services will be deployed throughout the year.
Why cash flow matters
Managing cash flow is an important aspect of any business. Healthy cash flow means that a business can pay salaries on time and also have funds for its growth and expansion. It also helps to ensure that there is money to keep the lights on and that taxes are paid on time. Cash flow helps you determine how much money is generated and spent by your business in a given time period. Simply put, it gives you a picture of the amount of money coming in and going out of your business through spending.
A good cash flow analysis will give you insight into three very important aspects of your business: operations, investments and financing.
In investments, it shows you the net income you are generating from your main activities. Positive investment income comes from sales while negative cash flow comes from wages, rents, taxes and others.
At the investment level, this is the amount of money tied up in equipment, property, or manufacturing plants. If the maintenance of these exceeds their income, you experience negative cash flow.
The third factor is funding, that is, the amount of money you pay for loans or service debts. A negative cash flow here doesn’t necessarily mean you’re losing money, but paying off debt.
Regular cash flow analysis is important to keep your business running smoothly. A cash flow analysis is a sure way to assess the health of your business because it helps you identify what’s going on where.