Abrigo, a provider of commercial lending software and services for U.S. financial institutions, today announced that Abrigo Small Business Lending has emerged from beta and is commercially available.
Recent data from the Abrigo Customer Lending survey reveals that many financial institutions are actively seeking to grow their small business lending portfolios, recognizing that this market will be pivotal for their future success. Overall, 88% of respondents expect small business loan demand to increase with the Federal Reserve rate cut, but only 7% use a different origination process for small business versus commercial loans.
Using the same process for complex commercial or industrial clients and community small businesses translates to a slower and less borrower-focused experience. According to a 2024 Federal Reserve Banks report, 41% of small business applicants had financing needs of less than $50,000. Despite the relatively small loan size, these small business loans play a critical role in benefiting business owners and their communities by boosting revenue growth and local employment. Banks also benefit as a larger mix of small business loans in their portfolio is associated with higher asset growth rates, especially for banks with less than $10 billion in assets.
Abrigo said Small Business Lending’s use of AI enables financial institutions to streamline loan origination, reduce processing times, and enhance decision-making for small business loans. With these capabilities, financial institutions can serve their communities more effectively, providing faster access to credit while lowering operational costs.
“Small businesses and the financial institutions serving them face a wide array of economic, logistical, and data challenges,” said Jay Blandford, CEO of Abrigo. “This technology is purpose-built to treat small businesses like small businesses, not complex commercial clients. Abrigo Small Business Lending enables speed closer to what consumer lending offers.”
Abrigo Small Business Lending features include:
Streamlined loan processing – Speed decisioning and closing processes with configurable, straight-through loan processing for faster origination, with lender intervention when needed.
AI-powered, transparent loan scoring – Assess applicants more comprehensively, ensuring that financial institutions can approve borrowers who might be overlooked by conventional models.
Design that ensures compliance – Gather small business lending data seamlessly for 1071 reporting. With built-in data firewalls and permissioning features, the application collects required data to ensure unbiased lending and compliant reporting.
Automation with the flexibility of human oversight – Abrigo’s platform adapts and integrates manual reviews, helping institutions maintain a balance between automation and human oversight.
