What is driving the need for change in small business lending? In a recent interview with Green Sheet, JUDI.AI discusses the challenges faced by credit unions and community banks when it comes to SMB lending. Traditionally, SMB lending has been a slow, high risk for low margin process that can take weeks to complete. Fortunately, the combination of AI, alternative data and open APIs has helped to streamline the process and result in:
- Automation: Takes the SMB loan underwriting process down from four weeks to four minutes and increases the number of loans processed by 40 percent.
- More volume, less risk: Unlocks more data sources to make models more accurate and SMB lending less risky—resulting in 30 to 50 percent less risk of default compared to loans using credit scores alone.
- Reinforced SMB relationships: Surface the business insights and trusted advice SMBs need to grow new and existing relationships.
JUDI.AI helps credit unions and community banks adopt an SMB-specific credit model, continuous risk monitoring and post-lending analytics designed to help grow loan portfolios and increase credit availability to their small business members and customers. Our credit science is based on more than $1 billion of small business applications analyzed, which has helped automate underwriting cycles and lend more without incurring more risk.
JUDI.AI also enables credit unions and community banks to conduct real-time cash flow analysis before and after funding, based on SMB-permissioned banking transaction data. Utilizing a proprietary transaction categorization engine, small business transactions such as withdrawals, transfers, recurring payments and other debt/credit payments are categorized and reviewed month by month – to help the SMB owner and financial lender keep a finger on the pulse of a business and review financial history faster and more frequently than an annual review.