By Roy Urrico
Bethesda, Md.-based Rapid Finance, a small business financing platform specializing in providing customized solutions, demoed and exhibited its artificial intelligence (AI)-ready data aggregation and assimilation platform, Lynx, at the FinovateFall conference, which took place from Sept. 9-11 in New York City. Rapid Finance’s CEO Will Tumulty and Vice President of Client Solutions Preethi Janardhanan showcased how Lynx integrates enterprise historical data with network and third-party data sources to reduce fraud and facilitate quick lending decisioning.
The demonstration highlighted several key use cases, including how Lynx identifies hard to detect fraudulent applications through data linkages, enhances customer experience by recognizing returning clients and support for recovery efforts by flagging applications linked to previously written-off loans.
Built with a modular, cloud-native, application programming interface (API) and graphical user interface (GUI) design, Lynx integrates with existing systems to validate, enrich and compare new customer applications with a vast database of historical data, allowing financial organizations to drive more efficient and intelligent decisions. Lynx can house and continually update and clean structured data that is exportable to AI models.
“Every business today is sitting on a goldmine of data, but few are able to fully leverage it to improve operations and drive profitability," said Tumulty. "With Lynx, we've built a platform that uncovers actionable insights that empower financial companies to make better decisions, create healthier portfolios and serve their customers more effectively.”
After the demo, Tumulty and Janardhanan sat down with Finopotamus to describe how Lynx can help credit unions and other financial service organizations.
Harnessing the Data Overload
Tumulty and Janardhanan explained how the recently enhanced Lynx platform has the capability to transform raw data into actionable insights to provide financial service organizations with a comprehensive and real-time view of applicants and customers.
“The problem that we all have today is not a lack of data? We are all drowning in data. The issue is that we are really not using the data effectively,” Tumulty told Finopotamus. “And the challenge is organizing all that data to deliver insights that can make your business better and more profitable. And to deliver those insights in real time to the frontline users like salespeople and underwriters and collectors, so that they can do their jobs better.”
Tumulty added that Lynx takes all of the application information, runs validations and enhancements, compares it to other applications in the Lynx system, finds connections and displays them in real time. “We built the first version of Lynx for ourselves about eight years ago to make our own data more useful and valuable. Since then, Lynx has been used in decisioning more than 25 million applications, to disperse more than $400 billion in small business financing,” he said.
He also pointed out Lynx is designed to aggregate enterprises’ siloed datasets into an organized structure to provide real-time actionable insights to frontline users in underwriting, sales and collections.
Janardhanan added, “It also does some of the other things, fraud prevention, in terms of third-party integration rules, engine setup, custom insights and so on. Its API can integrate into a loan origination system (that we also provide). We also have a UI (user interface) for lenders to have a quick setup.”
Finding the Hidden Indicators
Tumulty further illustrated how Lynx works. “A loan origination system will take in application information, like pull credit reports, (it) may do some data enhancements, and then create offers and ultimately get to signing docs and closing. What this tool does is for more than just loans. It could be loans, bank accounts, insurance policies. It is any new application that comes in. It enhances all that data so that you can find those related patterns.”
The first use case for Lynx involved looking at delinquent accounts. “We found hidden patterns between those accounts and others that were previously written off. These were not obvious things like Social Security numbers and EINs (employer identification numbers) and things like that, but things like nearby street addresses or secondary contact telephone numbers, device IDs, IP addresses,” Tumulty said. “We were not able to identify that these new applications were risky because we had not been able to tie together all of that application data across everything that we have ever seen.”
Tumulty emphasized, “That's what we built Lynx to solve. when you pull up a new application, what you will see are a number of indicators that say, ‘Hey, this looks clean, or we were unable to validate an identity,’ or, ‘Hey, this business shares data elements with another application that you've already seen.’ It allows you to grab that historical related transaction information and tie it to the application you are trying to make a decision on today.”
How Can Lynx Work for Credit Unions
Janardhanan noted that credit union implementation involves a simple upload into Lynx. “A CSV (comma-separated values) file; we will help them map it, upload it into Lynx; then it makes it really easy for them. They can relate to their members any new application that comes even a new membership application that comes in, they can see any patterns in our database.” Janardhanan listed attributes, such as previous interactions, secondary attributes, and “then waterfall to multiple levels as well”
Tumulty dove deeper on the topic, “For instance a good use case for credit unions are multi-product financial institutions. They will have mortgages, auto loans, credit cards; they may have small business lending. Often those acquisition processes are different because there's different needs based on those products. And the regulatory environment that is required to originate a new asset.”
Tumulty detailed how often gathering the necessary information requires harnessing fragmented data. "What Lynx does, rather than spending millions of dollars on pulling all that out of the backend and do ETL (extract, transform, and load) processing, you plug Lynx into those onboarding process at the front end., it keeps all of that data integrated and clean together for you. So, you do not have to do it on the backend.”
When a credit union receives a small business loan application, they can determine if the applicant is a credit union member, and if they have a checking and/or savings account, a credit card, or a car loan, as well as any missed payments.
In addition to Lynx, Rapid Finance provides other products to help credit unions and other FIs with small business financing, including:
Decisioneer – An end-to-end digital lending platform that helps banks, credit unions, and fintechs automate small business loan underwriting and origination.
SMB Disclosure Service – Helps disclose small and medium business (SMB) financial offer terms to commercial customers and maintain compliance with appropriate state regulations.
Earlier this September, Rapid Finance announced its integration with Q2’s Digital Banking Platform and its participation in the Q2 Partner Marketplace. Rapid Finance now offers its small business financing solutions via the Q2 Digital Banking Platform. The Q2 Partner Marketplace, which is part of the Q2 Innovation Studio solution, allows credit unions and banks to provide their account holders with innovative applications.