ATLANTA — In a recent market report, information technology research and advisory company Gartner discussed the impact of data breaches on personally identifiable information (PII) and account credentials. The November 2015 report, titled “Absolute Identity Proofing Is Dead; Use Dynamic Identity Assessment Instead,” describes the challenge for organizations in authenticating identity, either consumer or small business, using their current methods. The report calls for a multi-layered identity assessment approach that is dynamic and analyzes endpoint and user data. LexisNexis® Risk Solutions is cited as a Representative Vendor in the report.
According to Gartner, “Identity assessment is not a one-time event. It needs to be a continuous cycle that is triggered by an authentication or transaction. Organizations can pick and choose when to invoke the identity assessment cycle and which of the layered measures to take based on risk tolerance, identity assurance requirements and cost.” In the case of small businesses applying for credit, those with thin or no credit files—which is as many as 60 percent of all small U.S. businesses—can be introduced into the financial system this way without adding risk. “The most appropriate strategy for assessing identity claims should be fluid and dynamic.”
In addition the report notes, “The plethora of data breaches reported over the last few years has resulted in widespread compromise of regulated personally identifiable information (PII) and account credentials used to verify the identity of individuals conducting electronic transactions over the Web, telephone or mobile data channel.” For small businesses needing to establish identity and stability to secure credit, this situation can mean the difference between financial inclusion and continuing to be shut out of the system.
The Gartner report cited LexisNexis® Risk Solutions as a Representative Vendor in all channels using “aggregated PII and some alternative non-PII” and “electronic and document identity (PII)” information categories.
Ben Cutler, senior director, small business credit risk decisioning, LexisNexis Risk Solutions, comments: “Small businesses are an important and at times overlooked part of our economy. Oftentimes, early stage small businesses turn to family, friends and HELOCs to gain the capital they need to grow. Given the size of the small business market and the tendency of small businesses to remain loyal customers, lenders are actively seeking new ways to make informed decisions about lending to them, especially small business that are less than three to four years old. Alternative data opens the aperture through which lenders can view a small business’s likelihood of repaying a loan. Combining data from multiple sources produces a revealing footprint.”
The Small Business Financial Exchange, Inc. (SBFE) recently approved LexisNexis Risk Solutions as an SBFE Certified Vendor™, enabling the data, technology and advanced analytics company to blend its business risk information with SBFE business financial performance data, resulting in highly predictive small business credit risk scores, small business credit risk reports and small business credit risk attributes, which are available to SBFE members.
Contact Ben Cutler for more information about small business credit risk decisioning.
About LexisNexis Risk Solutions
LexisNexis Risk Solutions harnesses the power of data and advanced analytics to provide insights that help businesses and governmental entities reduce risk and improve decisions to benefit people around the globe. We provide data and technology solutions for a wide range of industries including insurance, financial services, healthcare and government. 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 and analytics for professional and business customers across industries. For more information, please visit www.risk.lexisnexis.com and www.relx.com.