AI technology company Stratyfy has formed a strategic partnership with cash flow underwriting and data analytics platform Prism Data. Through this collaboration, Stratyfy will leverage Prism Data’s cash flow data and scoring to enhance decision-making processes for lenders, especially when traditional credit data falls short in providing comprehensive insights.
Explaining the importance of this partnership, Stratyfy’s Co-Founder and CEO Laura Kornhauser stated, “Relying solely on traditional credit data may give lenders an incomplete view of loan applicants, leading to missed opportunities with potentially valuable customers. By combining our proprietary AI/ML technology with Prism Data’s CashScore, we aim to utilize cash flow data to help lenders accurately and transparently identify credit-worthy customers who might otherwise be overlooked.”
Prism Data’s CashScore product analyzes a multitude of financial data points that are typically absent in traditional credit reports, including income, assets, expenses, volatility, and repayment capacity. This innovative solution simplifies complex cash flow underwriting into a three-digit score, which lenders can use to approve or decline credit applications or incorporate into existing credit models and scoring systems.
Erin Allard, President of Prism Data, highlighted the benefits of CashScore, noting, “Prism’s CashScore empowers more accurate and inclusive credit decisions, enabling lenders to say ‘yes’ to up to 30% more customers without increasing risk. When combined with Stratyfy’s advanced decisioning technology, we are confident that lenders will be better equipped to promote financial inclusion while enhancing profitability.”
Prism Data, based in New York and established in 2016, introduced its CashScore FirstDetect solution earlier in the year. FirstDetect is designed to predict the likelihood of a customer defaulting on a loan by analyzing various financial details, trends, and patterns in the customer’s spending, earning, and saving behavior. This tool is particularly useful in combating “first-party fraud,” where a customer applies for a loan with no intention of repayment.
On the other hand, Stratyfy, founded in 2017 and headquartered in New York, made headlines at FinovateFall 2022 by winning the Best of Show award for its Unbias solution. Unbias, accessible via API, enables financial institutions and fintech companies to detect and eliminate bias in complex financial decision-making processes such as underwriting, thus supporting inclusivity and enhancing risk-adjusted returns.
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Stratyfy’s partnership with Prism Data marks a significant step towards revolutionizing the way lenders evaluate creditworthiness. By incorporating cutting-edge technologies and comprehensive cash flow data, these companies are paving the way for more accurate, inclusive, and profitable lending decisions.
It’s clear that the future of lending lies in harnessing the power of AI and data analytics to paint a more holistic financial picture of borrowers. With solutions like CashScore and FirstDetect, borrowers who may have been overlooked in the past are now getting the opportunity to access credit based on a more thorough assessment of their financial capabilities.
Stratyfy’s commitment to reducing bias in financial decision-making is commendable, as it not only fosters inclusivity but also enhances overall risk management practices. By utilizing AI to uncover and mitigate biases, financial institutions can create a more level playing field for all customers, ultimately driving better outcomes for both lenders and borrowers.
As the fintech industry continues to evolve, collaborations like the one between Stratyfy and Prism Data are a testament to the transformative power of technology in reshaping traditional financial processes. By staying at the forefront of innovation and adopting data-driven solutions, companies can stay competitive while driving positive societal impact.
With the rising demand for more sophisticated credit assessment tools, it’s exciting to see how partnerships like this will shape the future of lending and pave the way for a more inclusive and efficient financial ecosystem.
