Commercial Lenders: Want to assess your risk when lending to small businesses better? Here’s why now it’s more crucial than ever.

Aug 30, 2022 | Blogs

There were 5.4 million new business entrants to the U.S. economy in 2021, and the trend is expected to continue. All of these new businesses are candidates for business credit from the commercial lending market. However, most of them do not have the credit history to qualify for traditional credit lines or loans. 

As a result of these new business formations, lenders are assessing risk earlier in the life of a business and are seeking more comprehensive ways to analyze these new entrants. More and more commercial lenders are supplementing their use of traditional credit data with non-traditional information such as firmographic, macroeconomic, and social media data to determine the resiliency of small businesses. Non-traditional data overlays are becoming an increasingly popular way to assess risk this year.

Another approach lenders are taking is to use blended data ─ a combination of the business owner credit report and a business credit report ─ to better determine credit risk of those new entrants as well as mature businesses.

Xactus offers many business credit report products that will help credit managers and lenders accurately evaluate the creditworthiness of their commercial borrowers. Our business credit reports use verified and accurate data from leading credit agencies like Experian and Equifax. Here is a list of our business credit reporting products.

  • Business credit reports: Our reports include summaries of trade data that shed light on a business’ payment history.
  • Experian Premier ProfileSMGet a complete picture of a business with the one report solution to make a better, more profitable credit decision.
  • Experian Intelliscore Plus: Get the predictive data you need to expedite decision-making and control risk.
  • Business Owner Reports: Our reports offer credit information on the owners of a company.
  • Automated Decisioning with DecisionIQSM Quickly transform your paper application into an online application.
  • Tri-Merge Credit Reports: Xactus offers a full range of tri-merge credit reports as well as robust analytical tools.

Commercial lenders are also searching for alternative segmentation methods and ways to automate their processes. Machine learning has been a buzzword in credit risk for several years as lenders looked at the viability and acceptance of these tools.

The growing need for lenders to assess risk more thoroughly and accurately, by using more data points and with better segmentation, will enable faster and improved decisioning. As you can see from the list above, through Xactus’ business credit reports you can have access to a wealth of data. The products and reports help you look deeply into the health of a company, whether it is newly formed or a more mature business that is reacting to changes from Covid-19 and its impact on sales and supply chains. 

We want to provide you with the data you need to make confident and equitable data-based credit decisions. These methods help both commercial lenders and businesses to better analyze small business risk as the almost post-pandemic economy continues to heat up.  

Interested in learning more?  Contact us today.

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