How a leading alternative lending provider improved business verification rates by 84%

Markaaz partnered with a leading alternative small business lender to improve match rates on previously unverified business applicants.

Highlights

• Achieved an 84% verification rate on previously declined small business applicants.
• Delivered a rapid verification time of just 2 seconds per business.
• Harnessed the power of a pre-validated database of over 300 million small business records.

Background

This case study presents the results of a data test performed on a list of approximately 1,500 applications received by a prominent alternative lending provider catering to small businesses.  

The primary goal was to assess our business verification solutions, testing our match rate and officer validation capabilities. We also wanted to showcase how we could optimize the precision of their business verification procedures, streamline their application processing, and refine their overall application evaluation process.

Their goals included increasing the approval rates for their small business card applications, reducing errors (false positives and negatives), and lowering customer attrition. The lender receives about 15,000 applications a month, so increasing verification rates on the 10% of monthly unvalidated business applicants represents a substantial financial opportunity.

Verification tests were segmented into two categories based on the results of the previous verification process: 

• Declined: These businesses failed to pass the verification process. Reasons include missing information, unverifiable names or addresses, or association with known fraudulent entities.
• Incomplete: Some business records lack the necessary information required for verification and, in such cases, would be categorized as incomplete. 

Challenges

Business records are prone to error and inconsistencies, making it difficult to verify business identities against validating data sources and confirm whether an entity is suitable for funding.

The following are some of the challenges that the lender experienced as a result of their current verification processes:

• A substantial amount (10-20%) of unvalidated cases required manual approval, straining resources and throttling scalability. 
• Verifying large numbers of small to medium-sized businesses (SMBs) with high confidence was particularly difficult, further reducing efficiency. 
• The lender risked losing customers due to delays caused by slow, manual verification procedures.

Solutions

Increase verification rates by using a solution that quickly validates more small businesses and their officers.  

By harnessing the power of the Markaaz Directory, the lender increased match rates and decreased the need for manual approvals.

The real power of our verification solutions comes from our unique small business database, which houses over 300 million small business records from over 200 countries. We achieve a high degree of accuracy through proprietary data-matching algorithms and advanced analytics that resolve systemic data inconsistency challenges.

Optimize your business verification processes today

The results of this data test are clear: Markaaz's verification solution can provide significant benefits to companies that struggle to efficiently onboard customers. Our business verification solutions are ideal for organizations seeking to optimize their onboarding and small business funding processes. To learn more about how our solutions can help you maximize business verification, connect with our team today.

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