Small and medium sized business lending is coming on chain as one of the fastest growing RWA segments.
Our lead anchor Remy Blair spoke to Ryan Rosette, co-founder and co-CEO of Credibility, to hear more.
Take a look.
So when it comes to your space, what do you think SMB financing will look like, not just by year end, but also in the next 5 years?
Yes, that's interesting.
So you know, I believe that the way we're leveraging AI right now is we have, we have two patents that we've secured on a non-provisional basis.
They're workflow patents, so we're leveraging like agentic pricing, and so we're taking what has been.
Sort of like a mundane or very standardized way of underwriting questions that humans typically ask or look at, and we're actually using AI on an energetic basis to answer those and move it through the process quicker so we still believe that humans are in the loop.
So I view AI as decision making and I view blockchain more as infrastructure.
So you know where the investors on the blockchain side, it will broaden.
So where we do when we do an NAA securitization.
We have a bunch of institutional investors from insurance companies to large credit funds to large money managers.
Once it goes on chain, those same parties can also invest, but the difference is when you do an ABS, typically they're locked for 3 years, so there's no liquidity.
There is a secondary market somewhat, but we're not seeing it that much on our ABSs, and this on a blockchain marketplace platform similar to figure.
It will create liquidity, so those same investors who come in to buy on our ABS can now move out of that position if they have a different or better opportunity or you know pivot from their strategy and You know, I would say on a conventional basis on an ABS they were sort of locked in.
And finally, before I let you go, you mentioned the types of small medium businesses that are out there, but we all know that they are stretched for time.
So in a nutshell, for the person who's watching right now and trying to make sense of this, what would you tell them in a nutshell in terms of what you're doing credibly, OK, so what we do is we, we look at.
We're heavy into AI and data and analytics, so we're really looking at the customer as in their bank statements, time in business, and when we look at bank statements, we're specifically looking at what their cash flow looks like, what the revenue is, like how they're holding their average daily balance, how they're managing their cash, how they're transferring their cash, and less on the credit side.
So credit to us is, I think like maybe like a 13th or 14th most predictive data point that we're using in our decisioning.
So it's really sort of like we're really trying to judge the business based on how they operate and they're able to leverage their cash flow as an asset that they otherwise wouldn't.
And so when a small business historically would go to a bank.
It could be a 2 month process to get a no and so we're making decisions, you know, in sub 4 hours and in the next quarter we're launching an automated offer so where they will get decisioning in 2 minutes just based on data latency.
And then they will have they will have a decision and they can go through an online checkout and fund in 10 minutes.
So it's really like a difference in terms of how small businesses can access and you know we all know speed is important, so you know, but we don't, we're not judging speed based on we're still balancing risk.
And making the best decisions we can based on the data that we have available to us.
Well, Ryan, I appreciate your time.
Thank you so much for joining us here at the New York Stock Exchange and sharing the story incredibly.
I appreciate it.
Thanks for having me.
