Equifax, the consumer and business insights expert, has launched a new solution to support the government Commercial Credit Data Sharing (CCDS) initiative seeking to stimulate competition and encourage new entrants in SME lending, thereby addressing the shortfall in access to finance.

The new Equifax solution gives lenders a comprehensive picture of a businesses’ financial health to facilitate faster and more informed lending decisions. As a government-designated credit reference agency under the data sharing scheme, Equifax has access to new data sets from leading business banks, including a view of cash flow activity, debit and credit turnover, and minimum and maximum average balances. The data will be provided to lenders through Equifax Business Insights, which blends commercial and consumer insights for the commercial lending and credit market to optimise underwriting, lending and validation processes.

CCDS covers any company with a turnover of up to £25m – 99.9% of the entire UK business population[1]. The additional data will be a particular benefit to SMEs who only occasionally apply for finance. With a clearer view on whether businesses can afford repayments, banks and non-bank lenders will be able to offer SMEs more competitive loans.

The new solution also enables lenders to monitor a customer’s financial status, alerting them early to any potential problems with repayments, and identifying the most suitable course of action. This facilitates the requirements of the new lending standards to better support SMEs in times of financial stress.

NicBeishon, Head of Commercial at Equifax, says: “We’re excited to be supporting this government scheme to boost lending in the SME sector, essential to the health of the UK economy. CCDS is a game changer for many businesses who have the financial ability to repay a loan but who are currently either denied it or left in limbo when a lack of information leaves banks unable to make a timely decision. The new data overcomes this issue by providing an in-depth view of a business’ financial activity than has ever been accessible before.

“Combined with other industry initiatives, such as Open Banking and the Payments Services Directive 2, CCDS forms the foundation to restructure the SME lending market and help the sector grow. We will be using the data in a variety of ways to create new products for the market, helping lenders better evaluate loan applications. Whether a business needs finance to expand, invest in new technology or open a new office, they will now be able to get faster decisions to help make their plans a reality.”

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