Celent has released a new report, entitled Blueprint for Intelligent Small Business Credit Part 1: Achieving Viable Economics.
The good news: Banks can achieve viable, scaleable economics for small loans.
A confluence of forces is making small business credit ripe for disruption by agile lenders that effectively adopt AI. Due to demand-supply gaps and persistent dissatisfaction, small business credit revenues are up for grabs. Lenders harnessing AI to lower cost to serve while improving customer experience and risk pricing will overcome the historical challenges of generating sufficient returns and win market share.
The vast majority of small business credit providers struggle to make the economics work for small loans and for underserved business types. The report, authored by Celent senior analyst Alenka Grealish, double-clicks on four pillars of economic viability: know your customer/business, develop service level agreements (SLAs) across teams, reinvent workflows with AI and alternative data, and pioneering new models.
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The report is especially relevant to tier 1-3 banks worldwide, heads of small business banking/credit, heads of Data and Analytics (enterprise and LoB), chief credit officers and vendors of small business digital loan origination solutions.
A report forming part 2 of the research will focus on digital loan origination solution providers with a stand-alone offering.
Further information on how to access the full report is available via this link.
