FIS Launches SMB Digital Lending to Streamline Small Business Loan Processes
FIS has launched SMB Digital Lending, a cloud-native solution aimed at streamlining small business loan processes for financial institutions. Developed in partnership with Lendio, this solution leverages advanced data analytics and machine learning to help banks profitably source, underwrite, and fund loans of any size to small and medium-sized businesses (SMBs).
Key features include:
- Fully automated decisioning and loan boarding
- Embedded transaction analytics for holistic borrower health assessment
- Pre-qualification of SMB depositors
- Integration with existing technology stacks
The solution aims to reduce barriers and costs for SMBs seeking funding in a challenging economic environment, while helping banks generate additional revenue growth.
- Launch of SMB Digital Lending solution to streamline small business loan processes
- Partnership with Lendio to leverage advanced underwriting technology
- Potential for banks to profitably serve small business customers and generate additional revenue
- Cloud-native and API-driven SaaS solution for easy adoption and integration
- Expansion of FIS' digital banking capabilities to serve the entire money lifecycle
- None.
Insights
FIS’ launch of SMB Digital Lending represents a significant development in the financial services industry. As a financial analyst, I'd highlight that this new solution leverages advanced data analytics and machine learning, designed to streamline the loan processes for small and medium-sized businesses (SMBs). By automating underwriting and funding, banks can reduce operational costs and improve efficiency in loan origination.
Given that 99.9% of American businesses are SMBs, this move by FIS could substantially bolster loan accessibility. The solution aims to tackle the historically cumbersome and expensive loan underwriting process, which has been a barrier for many SMBs. By partnering with Lendio, FIS is combining their expansive reach in the banking sector with Lendio's underwriting technology. This collaboration is poised to create a more cost-effective and efficient lending process.
From an investment perspective, this initiative can enhance FIS' market position and revenue streams by tapping into a large segment of the market that has been underserved. The potential for reducing underwriting costs and improving loan accessibility could strengthen banks' profitability and market share, leading to an increase in their loan portfolios.
In the short term, adopters of this technology will likely see efficiency gains and a reduction in operational costs, thereby improving their competitive edge. Long-term implications include increased financial inclusivity for SMBs and potentially higher revenues for FIS due to the broad adoption of their digital lending solutions.
SMB Digital Lending leverages machine learning and cloud-native technologies, making it a cutting-edge solution in the fintech space. Machine learning plays a critical role in this solution by enabling automated decision-making and loan boarding, thus significantly reducing the need for manual intervention.
The cloud-native and API-driven SaaS model facilitates seamless integration with existing financial systems, enhancing flexibility for financial institutions. The use of data science is particularly noteworthy, as it allows for the generation of a holistic view of borrower health. This is achieved through embedded transaction analytics that can pre-qualify SMB depositors and target them with tailored marketing and sales outreach.
For investors, this technological innovation suggests strong potential for scalability and adaptability. Financial institutions adopting this solution can expect not only improved operational efficiencies but also enhanced customer experiences thanks to quicker and more transparent loan processes. Furthermore, these technological advancements can lead to better risk management through more accurate and data-driven underwriting decisions.
The reliance on advanced tech in this context underscores a broader trend of digital transformation within the financial sector. This can be particularly attractive to tech-savvy investors looking for companies that are at the forefront of innovation and driving industry standards.
From a market perspective, this move by FIS is strategic and reflects a deep understanding of the financial landscape. The fact that nearly half of America's workforce is employed by SMBs indicates a substantial market opportunity. Traditional lending processes have often been inefficient and costly, driving SMBs towards alternative lenders. By offering a streamlined, cost-effective solution, FIS is positioning itself to capture a significant share of the SMB lending market.
SMB Digital Lending addresses key pain points in the SMB lending space, such as extensive documentation and manual review processes. This can drastically reduce the time and cost associated with loan origination, making financial institutions more competitive. Additionally, by improving the affordability of loans for borrowers, it can lead to increased loan volumes and customer satisfaction.
Given the current economic environment, where interest rates are high and funding can be challenging, this solution is timely. It not only helps financial institutions to better serve their SMB clients but also positions them to gain a competitive edge by offering faster and more affordable lending options. This could potentially lead to an increase in market share for those adopting the technology.
Overall, this initiative could strengthen FIS' market presence and open up new revenue streams, making it a positive development for both the company and its investors.
Key Facts
- SMB Digital Lending leverages advanced data analytics and machine learning to help banks profitably source, underwrite, and fund loans of any size to small and medium-sized businesses.
- The solution, launched in partnership with Lendio, is FIS’ first in a portfolio of digital banking solutions to focus specifically on loans for small and medium-sized businesses, complementing existing services that cater to consumer lending and large corporate loans.
- By streamlining the lending process for financial institutions, SMB Digital Lending seeks to reduce barriers and bring down costs for small and medium-sized businesses seeking funding in a challenging economic environment.
“FIS’ SMB Digital Lending solution is a game-changer for financial institutions and small businesses alike,” said Steve Sabin, SVP, Division Executive, FIS Lending. “By partnering with Lendio, we are leveraging our unmatched scale and reach in the banking industry plus Lendio's advanced small business underwriting technology and empowering financial institutions to profitably serve their small business customers. The expansion of our digital banking capabilities illustrates FIS’ commitment to serving the entire money lifecycle—whether at rest, in motion, or at work—and I look forward to seeing the positive impact the solution brings.”
Why SMB Digital Lending Matters
According to the
How SMB Digital Lending Works
As a cloud-native and API-driven SaaS solution, SMB Digital Lending provides fully automated decisioning and loan boarding by focusing on smaller borrowers. By combining large-scale data science and machine learning with market-leading loan underwriting expertise, it helps banks profitably source, underwrite, and fund SMB loans of any size—ultimately seeking to make them more affordable for the borrower.
The solution’s embedded transaction analytics will also generate a holistic view of borrower health, pre-qualify SMB depositors, and target them with marketing and sales outreach to simultaneously help lenders generate additional revenue growth. Lenders looking to acquire new customers also may benefit by being connected to FIS’ direct marketplace and embedded lending relationships.
SMB Digital Lending is also built to complement any financial institutions’ current technology stack, including loan servicing solutions from FIS and other providers, seeking to make it easy to adopt and provide an industry-leading digital customer experience for small businesses.
“We are thrilled to partner with FIS, a global leader in financial technology, to help bring this SMB lending platform to banks across the country,” said Brock Blake, CEO and co-founder of Lendio. “Our mission at Lendio is to fuel the dreams of small business owners by simplifying small business lending. FIS’ SMB Digital Lending solution is a perfect fit for that mission, as it enables banks to offer a fast, easy, and transparent loan process to their small business clients. Together with FIS, we are creating a win-win situation for banks and small businesses, and we look forward to expanding our reach and impact through this partnership.”
Learn More
FIS’ SMB Digital Lending solution is available for immediate use by financial institutions of all sizes, from community banks and credit unions to regional banks, community development financial institutions (CDFIs), and alternative lenders. Interested institutions can contact smb.digitallending@fisglobal.com to learn more.
FIS is a financial technology company providing solutions to financial institutions, businesses, and developers. We unlock financial technology to the world across the money lifecycle underpinning the world’s financial system. Our people are dedicated to advancing the way the world pays, banks and invests, by helping our clients to confidently run, grow, and protect their businesses. Our expertise comes from decades of experience helping financial institutions and businesses of all sizes adapt to meet the needs of their customers by harnessing where reliability meets innovation in financial technology. Headquartered in
View source version on businesswire.com: https://www.businesswire.com/news/home/20240716307370/en/
Kim Snider, 904.438.6278
Senior Vice President
FIS Global Marketing and Communications
kim.snider@fisglobal.com
Source: Fidelity National Information Services
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