Much has been written about the death of the FICO credit score. See Wall Street Journal’s “Silicon Valley: We Don’t Trust FICO Scores” and American Banker’s “Will Fintechs Kill the FICO Score?” for recent (Summer 2016) articles. The narrative invariably revolves around how the score is backward looking…considers limited individual past behavior…and can occasionally misfire …
Spread across states and active in all industry sectors, over 5 million businesses in the US employ fewer than 20. Their total sales of over $4 trillion and total employment of over 20 million is roughly comparable to the entire Canadian economy!
We always knew that people feel good about the world when they see a booming Main Street. We now have the data to prove it.
A recent analysis by WAIN Street demonstrates the predictive power of very small business credit performance for consumer spending.
A recent analysis by WAIN Street confirms what practitioners already know—how very small businesses fare foretells what happens in bank loan portfolios. Loan portfolio quality is the primary factor affecting overall asset quality which is one of the most critical determinants of bank condition.
Is a loan to a baker in Hampden County, MA as risky as a loan to a baker in Orange County, CA? Is a loan to a plumber in AZ as risky as a loan to a dentist in AZ? Intuitively, the answer is no. The point of Localizing Risk is that the intuition can be …
A firm’s financial health determines its ability to repay debts. The promise of big data is to incorporate an ever increasing pool of information about a firm’s financial behavior to make better predictions. And by blending in qualitative factors such as social media chatter, big data seeks to make a quantum leap in assessing business credit …
The South is now the country’s most populous region and its largest economic area. Nearly two out of five Americans live in the South and the region accounts for 51 percent of the nation’s population growth since 2010.
Default rates vary for a myriad of reasons. They vary over time. They vary across geographies and industry sectors. And they vary across business size. Understanding this variation is important for constructing and managing credit portfolios.
One of the biggest challenges confronting small business lenders is the absence of data. And ultimately that hurts small businesses via higher interest rates. This is acutely evident in the burgeoning online lending industry. At WAIN Street, we want to change that.