The Impact of Algorithmic Lending on Access to Credit

Algorithmic lending has significantly transformed access to credit, particularly for small businesses and subprime consumers. This innovation has enabled the use of alternative data sources for lending, shifting from traditional country club relationships to data-driven decisions based on numerical analysis. Such advancements have profoundly impacted companies, individuals, and communities, allowing for the extension of underwriting to various data sources and products. The evolution of underwriting from traditional loans to more creative, short-term financing products has revolutionized the financial landscape, providing immediate funds based on verified identities. This development has been instrumental in providing credit, facilitating life changes, and offering incredible opportunities across different sectors. Whereas payments are viewed as transactional and less emotional, lending stands out as a highly emotional product with the potential to bring about significant life changes.