US Financial Institutions Expand SMB Lending as Rising Delinquencies Increase Focus on Decision Precision

09/10/2026

ATLANTA — LexisNexis® Risk Solutions released its 2026 US SMB Credit Risk Report: Improving Decision Precision, which examines how financial institutions are approaching small and midsize business (SMB) credit risk decisioning.

The result of the national survey of 125 SMB credit assessment professionals at US financial institutions shows lending is expanding while risk pressures intensify. Seventy two percent (72%) of practitioners said their institutions are actively or moderately expanding their SMB credit and lending businesses. Over the past two years, 71% reported SMB revenue growth of at least 5%. Similarly, 87% reported increased loan volume or demand and 60% reported increased approval rates.

Looking ahead, 70% expect SMB credit approval rates to increase over the next 12 months. No respondents said they expect approval rates to decline.

That expansion is unfolding in a more complex risk environment. Seventy-seven percent (77%) of respondents said SMB delinquency rates increased over the past two years. The top challenges cited by 30% of institutions respectively, are rising fraud and identity risk, difficulty monitoring risk across existing SMB portfolios and assessing risk for incomplete or thin SMB applicant credit files. 

• Decision confidence has limits. Fifty percent (50%) said they are very confident in any capability tested. Confidence was lowest for identifying early warning signs of SMB credit deterioration, cited by 37% of respondents. 
• Alternative data is becoming embedded. Use is highest at origination at 62%, followed by underwriting at 46% and portfolio monitoring and management at 42%. 
• Alternative data is having measurable impact. Forty seven percent (47%) said alternative data has had a major impact on faster credit decisioning. Forty-five (45%) percent cited it having a major impact on approving applicants with limited traditional credit history. 
• Investment is moving toward connected decisioning. Over the next one to two years, 75% plan to increase investment in artificial intelligence, 64% in fraud and identity risk tools and 54% in automation or straight through processing of credit decisions. 

From technology adoption to execution
Nearly nine in 10 financial institutions use analytics, AI or machine learning in some capacity, but only 22% use it extensively across SMB credit decisioning. The report states that AI can support more precise decisions when governed responsibly, trained and executed transparently and grounded in the right data.

“The conversation around SMB lending is no longer about accessing more data,” said Amy Crawford, senior director of strategy for business risk management at LexisNexis Risk Solutions. “It is about using the right insights at the right time to make better decisions. Our research shows lenders are navigating increasing demand, rising approval rates and higher delinquency levels simultaneously. Pursuing growth opportunities while maintaining disciplined risk management and stronger portfolio performance requires greater visibility into evolving risk.” 

Methodology
LexisNexis Risk Solutions worked with an independent research firm in May 2026 to conduct a national survey of 125 SMB credit assessment professionals at financial institutions across the US actively involved in SMB lending. All participants indicated that SMBs are at least somewhat important to their business and that their organization offers at least one SMB credit or lending solution. 

About the 2026 US SMB Credit Risk Report
The report provides insights from US financial institutions on the acceleration of SMB lending and evolving credit risk strategies. It explores growth opportunity, market visibility challenges, decision confidence gaps, alternative data use, technology investment and the path from adoption to execution. 

About LexisNexis Risk Solutions
LexisNexis® Risk Solutions provides customers with information-based analytics and decision tools that combine public and industry-specific content with advanced technology and algorithms to assist them in evaluating and predicting risk and enhancing operational efficiency. Headquartered in metro Atlanta, Georgia, the company has offices throughout the world, serves customers in more than 190 countries and territories and is part of RELX. For more information, please visit LexisNexis Risk Solutions and RELX.