Lendinero's blog on Growing Your Business
Before the recession much fraud occurred with bank statements, due in part to banks and financial credit offered easily. Before 2007, technology was not widely used to detect if the bank accounts were real or fake. After the recession many aspects have changed in the financial industry.
Today, in the world of alternative business loans to a system called “Decision Logic” is used to prevent fraud from business borrowers. It is an advanced bank verification that allows lenders to instantly verify the financial information of a potential borrower, online and in real time. Previous methods caused many problems for both the lender and the borrower, including defaults, inaccuracy and fraudulent bank statements.
DecisionLogic is the creator of this technology. The company’s goal is to improve the verification of high-risk assets for both the borrower and the lender, improve the industry and creating opportunities for much of the population to access financial assets.
However, many Hispanic entrepreneurs are not accustomed to using this system. This is how the system works:
The day before closing a business advance or business loan the lender sends the applicant a link configuration. The owner of the company opens it up, they input their bank username and password. Many fear this part, but it’s safe. DecisionLogic is a company that helps prevent fraud. The link can only be used once. If the business owner does not input the information within a certain time frame or inputs the wrong username or password, the link is no longer valid.
When the borrower inputs the username and password no one has access to that information. The only thing the business borrower is doing is giving permission to the lender that is providing the loan see the business bank account via the Internet to check real time date and month to date bank activity up to that date that the link is executed. Neither DecisionLogic, or the lender will have access to the business borrower’s username or password. Once this information is submitted, the company allows the lender see the bank statements in real time data up to the minute to ensure that the financial information provided is correct.
This technology prevents fraud. At the same time it is used for several reasons. A business can apply for one, two or even three loans. With this system, when the lender sees the bank account in real time, it ensures the lender that the business did not take a second or third loan. This prevents businesses from being over leveraged and reduces defaults.
This prevents businesses do not take on more debt than they can afford. In addition, it eliminates scammers from lenders. South Florida was among the states with the highest fraud. Reduciting default rates will help alternative business lenders become more competitive in offering lower rates and extended terms in the future.
ARTICLE IS TRANSLATED FROM THE MIAMI HERALD’S SPANISH EDITION. FULL CREDIT TO THE MIAMI HERALD.
Read more here: http://www.elnuevoherald.com/noticias/finanzas/article50663235.html#storylink=cpy
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