Struggling with the economic impact of Covid-19, American online small business lender Kabbage is furloughing a “significant number” of its 500-strong US team and closing down its Bangalore office, according to TechCrunch.
In a memo sent to staff and seen by TechCrunch, CEO Rob Frohwein says: “The economic fallout of this virus has rattled the small business community to which Kabbage is directly linked.”
The Bangalore office is being closed permanently, while company executives are taking a “considerable” pay cut and an unspecified number of American employees are being furloughed.
“While the duration of the furlough remains uncertain, please bear in mind that the full intention of furloughing is temporary. We simply have no clear idea of how long quarantining or its reverberations in the economy will last,” writes Frohwein.
Kabbage, which in 2017 received $250 million in funding from Japan’s Softbank, uses data generated through business activity to evaluate and provide loans to small businesses in minutes.
Earlier this month the firm made a plea to governors, state legislators, and mayors to put in place “aggressive” action to help small businesses struggling with the Covid-19 fallout.