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Symbid’s New Approach To Alt-Lending Risk

Lenders, both alternative and traditional, must pay extra attention when considering placing their financing with startups; new businesses are notoriously high-risk, with no guarantee of financial success. But as economic and government pressures weigh upon investors to boost SME financing, backers have begun to search for more innovative ways to rate the companies looking for support.

Symbid launched its alternative lending platform in the recognition that small businesses have a much more difficult time convincing investors of their worth. On Thursday (June 4), the company revealed a new collaboration with risk management officials in the EU to adopt a third-party credit risk assessment mechanism for investors working on the Symbid platform.

The company will tie-up with Catena to offer the INRISC scoring and pricing service as Symbid prepares for the launch of its loan crowdfunding service. According to a company announcement, Netherlands-based Symbid is the first online alternative lending platform that will use a third-party credit risk service in search of objective interest rates for SME borrowers.

The INRISC system uses accounting data and automated Big Data analysis to produce its assessments, reports said. Catena will fuel the INRISC analysis with data stemming from Monitoring by Symbid, which will stream through accounting reporting systems.

Symbid revealed the new feature as its platform, The Funding Network, approaches $35 million in transaction volume, according to the company’s co-founder and CEO Korstiaan Zandvliet. “With Catena on board, we’re confident that our upcoming loan crowdfunding product will be the most transparent on the market,” he said in a statement. “Looking ahead, instant scoring and pricing will be a cornerstone of our offering to professional investors.”

In an interview with PYMNTS last month, Zandvliet said that the platform will also be focusing on new European markets and is in the midst of exploring ways to allow investors to trade their investments in an entirely digital format.


Featured PYMNTS Study: 

With eyes on lowering costs to improving cash flow, 85 percent of U.S. firms plan to make real-time payments integral to their operations within three years. However, some firms still feel technical barriers stand in the way. In the January 2020 Making Real-Time Payments A Reality Study, PYMNTS surveyed more than 500 financial executives to examine what it will take to channel RTP interest into real-world adoption. Here’s what we learned.

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