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Lenders Get Tools to Include More Small Businesses in the Financial System

SBFE Members can improve risk decisioning on thin and no-file small businesses when leveraging LexisNexis® Risk Solutions suite of small business credit risk decisioning products


ATLANTA -- LexisNexis® Risk Solutions, a data, technology and analytics company and SBFE Certified Vendor™, unveiled today its Small Business Credit Report, the newest addition to its credit risk decisioning suite that enables lenders to address the growing small business lending market with new financial intelligence and confidence.

Considering over 60 percent of businesses in the U.S. are small companies with thin and no credit files, it’s critical for lenders to secure the broadest information available to assess accurately risk on these entities. The combination of traditional credit payment histories with broad, non-credit “alternative” data can yield strong segmentation tools that maximize credit decisioning on applicants.

“The average lender can receive thousands of small business loan applications a month,” said Ben Cutler, senior director, small business credit risk decisioning, LexisNexis Risk Solutions. “Leveraging this suite of small business credit risk solutions enables lenders to expand their addressable market by simply being able to effectively decision the many thin and no-file applicants. And lenders can do this faster without adding additional risk to their loan portfolios.”

LexisNexis Risk Solutions suite of small business credit risk decisioning tools is now composed of small business credit reports, credit scores, blended credit scores and risk-modeling attributes that fuse credit payment histories with alternative data sources.

“Many banks struggle in the SMB market because they can neither underwrite at scale nor respond to credit applications rapidly,” said David O’Connell a Senior Analyst who covers SMB and corporate lending at Aite Group. “Multi-data set capabilities such as the LexisNexis Small Business Credit Report, by rapidly bringing more data to bear on underwriting decisions, help banks to overcome these barriers to scale and make better credit decisions.” 

Upon this announcement, lenders now have access to the tools they need for greater insight and knowledge about small businesses so that they can extend credit at optimized terms to a wider population of small businesses that before were overlooked.

LexisNexis Risk Solutions created its small business credit risk decisioning tools exclusively for SBFE Members, who represent more than 200 of the nation’s top small business lenders. The suite provides lenders with never-before-available insights and predictive capabilities so that they can make highly informed small business loan decisions.

LexisNexis Risk Solutions small business credit risk decisioning tools combine the company’s vast U.S. business and consumer data with SBFE payment-performance data. LexisNexis U.S. business coverage, culled from more than 13,000 public and other proprietary sources, surpasses other providers’ coverage of small, new and niche businesses. The company’s business and consumer intelligence enables it to solve the perplexing problem of identifying and linking the people and other businesses who are connected to a small business by leveraging a patented, multi-dimensional architecture. These advantages empower SBFE Members to find underpenetrated consumer segments, offer attractive terms, and manage default risk at multiple stages of the credit lifecycle.

“SBFE is very pleased that LexisNexis Risk Solutions, an SBFE Certified Vendor™, has added this latest tool to its small business risk management toolkit,” said Carolyn Hardin-Levine, Small Business Financial Exchange, Inc. and SBFE, LLC Chief Executive Officer. “LexisNexis Risk Solutions proprietary data assets, combined with the predictive power of SBFE Data™ will provide lenders with solutions to effectively make small business risk decisions.”

Lack of financial intelligence about small businesses has been a roadblock for lenders and resulted in the exclusion of millions of small businesses from the financial system. As of today that roadblock no longer exists because lenders now have a deeper view into a wider population of small businesses interested in using credit facilities to grow their businesses, hire more people and, ultimately, stimulate long-term economic growth.

About LexisNexis Risk Solutions
LexisNexis® Risk Solutions harnesses the power of data, sophisticated analytics platforms and technology solutions to provide insights that help businesses across multiple industries and governmental entities reduce risk and improve decisions to benefit people around the globe. Headquartered in metro Atlanta, Georgia, we have offices throughout the world and are part of RELX (LSE: REL/NYSE: RELX), a global provider of information-based analytics and decision tools for professional and business customers. For more information, please visit LexisNexis Risk Solutions and RELX.

About Small Business Financial Exchange, Inc. and SBFE, LLC (SBFE)
The Small Business Financial Exchange, Inc. and SBFE, LLC (collectively known as SBFE) is the leading source of US small business credit information. Established in 2001 as a non-profit organization, today the exchange houses information on about 24 million businesses in its SBFE Data Warehouse™, and enables blind information exchange among its Members. Through its resources, relationships and SBFE Certified Vendors™, SBFE enables innovative risk management solutions. SBFE sets the highest standards for data quality, integrity of use, data governance and information security for SBFE Data™ to protect its Members and their customers' information. SBFE is the only Member-controlled organization of its type and is a trusted advocate in promoting the needs of the small business lending community.
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