Banking and Finance Industry Insights

Strategic Insights July 2020

The PayNet Small Business Lending Index (SBLI) stemmed its freefall in May, ticking up 2.1 points (+1.9%) to 111.4 but still nearly 30% below its year-ago level. The SBLI 3-month moving average declined 8.9% and is down 25% compared to a year ago.

Read More
arrow above box

The CARES Act – What it Means for Main Street

This blog post by PayNet SVP & GM William Phelan focuses on the Paycheck Protection Program (PPP) and its implications for small businesses and small business lenders.

Read More
arrow above box

Strategic Insights June 2020

The PayNet Small Business Lending Index (SBLI) fell 14.4 points (-11.8%) to 107.4 in April and is now 32% below its year-ago level. The index has lost seven years’ worth of gains over the last two months.

Read More
arrow above box

Strategic Insights May 2020

The PayNet Small Business Lending Index (SBLI) fell 19.6 points (-13.5%) to 125.2 in March, its lowest level since July 2017, and is now 10.5% below its year-ago level. The SBLI 3-month moving average declined 4.1% last month and is also down 4.1% over the last twelve months.

Read More
arrow above box

Strategic Insights April 2020

The PayNet Small Business Lending Index (SBLI) ticked down 1.1 points (-0.7%) to 147.7 in February while edging up 0.5% from February a year-ago. The SBLI 3-month moving rose 1.6% last month and is up 2.3% compared to February last year. The index’s February movement predates the impact of COVID-19.

Read More
arrow above box

Strategic Insights March 2020

The PayNet Small Business Lending Index (SBLI) increased 4.8 points (+3.4%) to 147.9 in January while declining 1.0% from January last year. The SBLI 3-month moving average edged down on a monthly basis (-0.1%) but improved from year-ago levels (+1.3%).

Read More
arrow above box

Strategic Insights February 2020

The PayNet Small Business Lending Index (SBLI) fell 1.5 points (-1.1%) to 138.6 in December and is up 3.9% above its year-ago level. The SBLI 3-month moving average ticked down on a monthly basis (-0.3%) while increasing slightly relative to a year ago (+0.6%).

Read More
arrow above box

A 20/20 Outlook for 2020

PayNet and KeyBridge recently teamed up to present our quarterly economic webinar, with an eye on our 2020 outlook. As we begin the new year, a strong consumer base and a healthy labor market should keep the economy afloat, but growth is likely to slow further – potentially to a crawl. The extent of the economic slowdown will depend on the answers to some important questions.

Read More
arrow above box

Strategic Insights January 2020

The PayNet Small Business Lending Index (SBLI) fell 8.1 points (-5.4%) to 140.8 in November and is 1.9% below its year-ago level. The SBLI 3-month moving average ticked down on a monthly basis (-0.4%) but grew modestly relative to a year ago (+1.2%).

Read More
arrow above box

Decreasing the Burden of Centralized Data Collection on Small Business Lenders

Recently, I served as a panelist at a Consumer Financial Protection Bureau (CFPB) symposium on Section 1071 of the Dodd-Frank Act, which requires the CFPB to centralize collection of small business lending data and make it public.

Read More
arrow above box

Digital Lending and Main Street Credit in 2019: Major Milestones

As we look back on 2019 and what has affected the flow of credit to private businesses, there are five key areas of impact on the digital lending space.

Read More
arrow above box

Strategic Insights December 2019

The PayNet Small Business Lending Index (SBLI) improved 7.7 points (5.5%) to 147.5 in October. On an annual basis, the SBLI ticked down -0.1%, while the SBLI 3-month moving average ticked down on both an annual (-0.4%) and monthly (-0.6%) basis.

Read More
arrow above box

Strategic Insights November 2019

The PayNet Small Business Lending Index (SBLI) fell 3.3 points to 139.4 in September but remains in the top 15% of historical readings. Compared to a year ago, the SBLI is up 4.7%. The SBLI 3-month moving average ticked up on both an annual (+1.0%) and monthly (+0.5%) basis.

Read More
arrow above box

Prepare for Recession, Plan for Growth

Now is the time for lenders to prepare for a credit cycle downturn so their organization is ready when - not if - recession arrives. When it comes to your own business decisions, understanding your risk on both the front end and back end becomes more critical during a recession. This article lays out the three tools lenders should use to prepare so they can mitigate risk and focus on growth when the recession does arrive.

Read More
arrow above box

Key Steps to Prevent Commercial Lending Fraud

Commercial lending fraud is on the rise, and both online and traditional banks as well as credit unions are challenged with identifying, weeding out and tracking suspicious activity. As technology creates increased convenience and accessibility for customers, it also creates opportunity for criminals.

Read More
arrow above box

Q3 Macroeconomic Update

A series of economic headwinds — including a weakening industrial sector, ongoing trade tensions, and softening business investment — are creating an increasingly uncertain operating environment for small business.

Read More
arrow above box

Strategic Insights October 2019

The PayNet Small Business Lending Index (SBLI) fell 8 points to 142.2 in August and is down 5.5% compared to a year ago. The SBLI 3-month moving average also fell and is now below its year-ago level for the first time in more than two years. Despite the decline, the SBLI is still in the top 10% of historical readings.

Read More
arrow above box

The Next Recession is Coming – Here’s How to Prepare

As recent stock market fluctuations are telling us, a recession is coming – and the market knows it. While we can’t predict the future, current economic conditions can help us understand the type of recession we may face, giving insight into the changing business cycle and how to prepare for what’s to come.

Read More
arrow above box

ARE YOU READY FOR THE NEXT RECESSION?

As growth has slowed in 2019, we are reminded of the Great Recession, and we are increasingly on the lookout for the next one. It’s a question of when—not if—a recession will arrive. Now is the time to prepare so we are not only ready but also poised for growth when the next recession is here.

Read More
arrow above box

Strategic Insights September 2019

The PayNet Small Business Lending Index (SBLI) rebounded in July, jumping 15 points (+11% M/M) to 152.2. The SBLI now stands near its all-time high and 5% above year-ago levels. The SBLI 3-month moving average fell 1.3% on a monthly basis and ticked up slightly on an annual basis.

Read More
arrow above box

Why Commercial Credit?

For 3,000 years, the process of making a loan to a small business has remained largely unchanged. However, we’re at a transition point in history in which technology can help this millennia-old process evolve.

Read More
arrow above box

How Small Business Owners and Entrepreneurs Can Capitalize on the Fed's Rate Cut

On July 31, the Federal Reserve did something it hasn’t done in 11 years: it cut the federal funds rate by 25 basis points, to a target rate of 2.0 percent to 2.25 percent. The Federal Open Market Committee voted by a wide margin to lower rates as a precaution against signs that the US economy may be slowing after an unprecedented expansion.

Read More
arrow above box

Digital Lending: The Next Era of Banking

Across the board, conditions are good for bankers. However, as banking’s “Goldilocks” era – marked by upward growth momentum, low inflation, and historically low financial market volatility – inevitably wanes, the banking industry will enter a new stage: that of digital lending.

Read More
arrow above box

Strategic Insights August 2019

The PayNet Small Business Lending Index (SBLI) fell nearly 23 points (14.5%) to 135.0 in June — its sharpest monthly decline on record and lowest point since December — and is now 6.8% below year-ago levels.

Read More
arrow above box

Three Ways Automation Fuels Small Business Lending

Building a business is fraught with risks. Chief among them is access to capital. A recent survey by the Federal Reserve shows that 64% of small businesses face financial challenges and more than two thirds of them use their own personal funds to support their businesses.

Read More
arrow above box

The Pursuit of One-Click Commercial Credit: What you Need to Know

The race is on to figure out fast, safe, and low-cost lending to small- and medium-sized businesses, accelerating the journey towards the ultimate goal of one-click commercial credit – or using automation to simplify credit to the point of a single click.

Read More
arrow above box

Client Responses to the PayNet/Equifax Merger

Recently, PayNet and Equifax combined forces. In making this decision, the key considerations were our customers, our employees and our overall businesses.

Read More
arrow above box

Strategic Insights July 2019

The PayNet Small Business Lending Index (SBLI) fell slightly to 157.2 in May but is up 1.3% compared to twelve months ago and remains near an all-time high. The SBLI 3-month moving average rose on a monthly basis and currently stands 2.4% above its year-ago level.

Read More
arrow above box

Tariffs and the Potential Impact on Small Businesses

The ongoing trade rhetoric with China and threats of new tariffs on Mexico have the potential to negatively impact not only our largest corporations but the 30 million small and mid-sized businesses (SMB) in the United States. These SMBs, which fuel economic growth on Main Streets across the country and employ half of all working Americans, have reasons to be concerned.

Read More
arrow above box

Q2 2019 Credit Outlook for Main Street

PayNet's Q2 2019 report for credit conditions on Main Street and where they're heading.

Read More
arrow above box

PayNet Five To Know | May 2019

See what PayNet’s been up to in May. Check out the latest edition of the PayNet 5 to Know newsletter, which covers PayNet’s top 5 news items, research, articles, and videos that have been released each month.

Read More
arrow above box

PayNet Strategic Insights June 2019

The PayNet Small Business Lending Index (SBLI) rose 20.1 points to an all-time high of 159.7 in April and is now up 11.4% compared to year-ago levels. The SBLI 3-month moving average also rose on a monthly basis and currently stands 3.2% above its year-ago level.

Read More
arrow above box

What Are Small Businesses?

80% of small businesses are still run by the same individual or family that started the business. Raddon VP of Research Bill Handel lays out some critical statistics about the longevity and revenue size of small businesses and how those impact their credit needs.

Read More
arrow above box

Wrap Up

60% of small businesses are in growth mode, yet at the same time, there's been a decline of small business entrepreneurship. The reason for the decline? America's broken credit system. PayNet President & Co-Founder William Phelan lays out the vital impact small businesses have on the economy--and why fixing the credit system is an imperative initiative.

Read More
arrow above box

Where Small Businesses Like to Bank

71% of small businesses use one of the Top 6 banks as their primary financial institution, compared to just 39% of consumers. Raddon VP of Research Bill Handel lays out the two main reasons for the big banks' dominance in the small business lending space. Meanwhile, PayNet SVP & GM William Phelan provides insight into how this phenomenon represents an opportunity for community financial institutions.

Read More
arrow above box

Strategic Insights May 2019

The PayNet Small Business Lending Index (SBLI) fell 6.5 points to 140.0 in March and is now down 3.8% compared to year-ago levels. However, the index remains in the top 10% of all historical readings. The SBLI 3-month moving average rose on a monthly basis and currently stands 0.7% above its year-ago level.

Read More
arrow above box

Strategic Insights April 2019

The PayNet Small Business Lending Index (SBLI) remains in the top 3% of all historical readings. While the SBLI edged down 2.4 points to 146.9 in February, it rose 2.1% on an annual basis, its 16th year-over-year increase in the last 17 months.

Read More
arrow above box

The 20-year Challenge: Commercial Lending Then & Now

2019 marks PayNet’s 20th anniversary, and I am excited to celebrate this milestone with the people who propelled us to where we are today. While we’ve grown, our core mission of fixing the broken credit system with reliable, transformational Main Street credit assessment solutions has remained the same.

Read More
arrow above box

A Recap of 2018 Events: The Digital Lending Revolution

Digital transformation – a key trend in lending – is top-of-mind for financial institutions evaluating their strategy in 2019. Technology has the power to streamline business operations and bring new revenue opportunities to organizations that prioritize digital growth.

Read More
arrow above box

Decline of Small Business Lending

A new study from Raddon and PayNet suggests that lending practice reforms will connect small businesses with credit and boost economic performance.

Read More
arrow above box

Rise of Fintech

A decline in credit access in large banks has led to the rise of the fintechs in the lending space. The percentage of small businesses borrowing online has gone from 14% in 2014 to 24% in 2018--a dramatic jump whose implications should concern financial institutions.

Read More
arrow above box

Small Business, Big Impact

The 30 million small businesses in the U.S. account for about half of the GDP. Raddon VP of Research Bill Handel and PayNet SVP & GM William Phelan explain small businesses' vital role as a growth driver in the U.S. economy—and how this explains the decline in GDP since the Great Recession.

Read More
arrow above box

The Broken Credit System

The hypothesis: big bank lending was down and it was impacting local economies. Drawing on the large pool of PayNet data, Harvard laid out a study to see if this was true--and if so, the reasoning behind it.

Read More
arrow above box

Strategic Insights March 2019

Business investment picked up in the fourth quarter after a deceleration in Q3, but overall economic growth cooled and is expected to weaken further in 2019. Small business sentiment has also softened thus far in 2019, in part because of the January government shutdown.

Read More
arrow above box

Q1 2019 CREDIT OUTLOOK FOR MAIN STREET

Booming had been the story about Main Street America with the releases of data for most of 2018. Booming is proving to be short-lived as we see in this latest report.

Read More
arrow above box

REVIVING MAIN STREET AMERICA

While the country enjoys unprecedented levels of small business optimism, access to credit will either boost or curtail economic growth within this high-impact sector, according to a new study.

Read More
arrow above box

Digital Disruption and Why Lenders Should Care About Brand

Every business leader faces the challenge of communicating brand in a way that's relevant to customers and prospects. Historically, business strategies put more emphasis on marketing products - but as technology continues to advance - new solutions are emerging and creating an overcrowded, hard-to-differentiate marketplace..

Read More
arrow above box

New Study Demonstrates High Lift from Commercial Scores Even in Cases Where Credit Files Are "Thin"

A PayNet client asked how predictive PayNet’s scores were when the borrower’s credit file was thin, with few prior contracts. To evaluate this, PayNet conducted two analyses using PayNet MasterScore® v2 at time of origination for transactions originated from 2005 to 2012...

Read More
arrow above box

What is the Impact of Repossessions on a Borrower's Credit Score?

A PayNet client operating in the US and Canada asked about the impact of repossessions of a single or several trucks on a large borrower’s credit profile.

Read More
arrow above box

What is the Credit Quality of Marketplace (Alternative) Lenders?

Marketplace refers to a broad category of companies providing capital to businesses and consumers at a lower cost than traditional channels using a combination of technology, data, analytics, and traditional credit systems. The Marketplace lending model is generally high risk with high return.

Read More
arrow above box

FILLING THE LENDING VOID

As small businesses struggle amidst the shutdown-induced SBA program closure, they may have other options.

Read More
arrow above box

Uberization: Just a Good Idea or a Transformational Business Strategy?

Digital disruption is here. In an era in which consumers demand instant gratification – usually via their mobile devices – organizations are faced with the dilemma of transitioning their ‘business as usual’ mindset to a more modern, innovative way of thinking.

Read More
arrow above box

Taking a Cue from FinTechs

There’s no doubt that private businesses have a profound effect on the economy. With over 28 million private businesses that account for at least half of the U.S.’s GDP, this segment plays a significant role in how our nation is doing when it comes growth or contraction.

Read More
arrow above box

Utilizing Technology to Capitalize on Rising Commercial Growth

The U.S. is undoubtedly experiencing economic growth – with the GDP rising 3% over two of the last three quarters.

Read More
arrow above box

Closing the Growing Private Business Credit Gap

While the U.S. economy has shown its recovery from the Great Recession in most ways, small business lending isn’t one of them.

Read More
arrow above box

Lessons from Testifying Before Congress

All eyes were on Mark Zuckerberg as he testified before Congress. As I watched, I was reminded of my own experiences testifying before Congress.

Read More
arrow above box

How to spark transformation in 2019

First off, we’ve refreshed our corporate brand, which you can see in full display on our relaunched website. This identity brings a clear focus to who PayNet is today, a company fully energized and engaged in the transformation of commercial lending.

Read More
arrow above box