Kabbage loan EFFECTIVE interest rate?

Hi fellow hosts. We’ve received an offer for an Airbnb loan from Kabbage. They present it as interest free but that’s only because they charge what’s called a monthly “fee.” Has anyone who has used this loan product calculated their EFFECTIVE annual interest rate? (E.g. 2% of amount outstanding each month is an effective rate of 24%. )

I don’t know anything about that type of loan, but I have a comment about loans in general. I don’t think I, personally, I would go into debt to create or renovate an Airbnb location. Not unless it were going to be a really lucrative one. I think a careful business plan would have to be in order to see whether that is justified. Airbnb can be a good income generator, but paying off the loan could take a long, long time.

@Josiah got a Kabbage loan and was very happy. I applied just to see and they wanted a high interest rate. I have lots of low interest options so if I needed to borrow money there are better ways for me than Kabbage.

Generally speaking I agree with Rebecca. I can only imagine how many young borrowers (who are barely making ends meet via Airbnb as it is) are now going to get Kabbage loans to take that vacay to Cozumel or buy a new car.

I posted in this thread where I had found all of Kabbage loans (advances) all had effective interest rates that hovered around 25%.

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It is predatory lending, if you ask me.