Why Cash Flow Data Beats Credit Scores for CDFI Lenders

<p>FinRegLab, in partnership with NYU Stern, analyzed over 38,000 small business loans originated between 2015 and 2024 — and the findings are definitive: cash-flow variables from live bank account data are a meaningfully stronger predictor of loan performance than personal credit scores, especially for the underserved borrowers CDFIs were built to serve.</p><p>CDFIs like Allies for Community Business, Ascendus, LiftFund, Ponce Bank, and Texas National Bank have already put cash-flow underwriting into production. The remaining barrier isn't belief — it's infrastructure. Lenders who've cracked the code connected live bank data feeds directly into their loan origination systems, cutting processing from months to weeks.</p><p>🔗 <a href="https://www.fundingo.com/why-cash-flow-data-beats-credit-scores-for-cdfi-lenders/">Read the full article on Fundingo.com</a></p><p><em>Brought to you by <a href="https://www.fundingo.com">Fundingo</a> — Loan Management Software Experts.</em></p>