Bankrupt Loan Servicer Kabbage Ends $65.5 Million Fee Dispute

Small business loan servicer Kabbage, Inc. won court permission to settle its fight with Customers Bank over unpaid servicing fees, which will bring enough cash into bankrupt Kabbage for it to finish winding down.

US Bankruptcy Judge Craig Goldblatt gave Kabbage, which operated under the name KServicing, permission to sign a deal with Customers that cuts $8 million off the $65.5 million that Customers allegedly owed the company. Under the agreement, Customers will pay $23 million to Kabbage, while Kabbage will be allowed to retain $35 million it allegedly owed Customers.

Kabbage filed bankruptcy last month after the company ...