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The small-business landscape is about to change with the entry of small-business-focused banks. These new solutions can involve both big and small players, but overall many are embracing fintech innovations powered by artificial intelligence and new technologies. The goal is to have all financial services interconnected, predictive, intuitive and readily accessible.

Currently, there is a lack of information to assess the operations of a small business to determine creditworthiness. In addition, each small business is distinct from another. Because of this, lending to small-businesses is riskier than larger corporations. Traditional banks and tech companies like Amazon, PayPal, and Square are creating new credit algorithms to make credit evaluation more predictive and for small-business lending to generate more profits.

Low-cost digital banks will be the norm while specialized banks will have a competitive edge. All types of loans, credit lines, payments platforms, business intelligence, and several other products or services will soon be integrated. The digital experience will be easier for small business owners as it will be less time-consuming. Specialization will improve loan underwriting and customer service. These banks will be the go-to loan provider for future small businesses.