• Multipoint Verification: A next-generation business verification tool powered by blended credit bureau data and non-traditional sources to calculate risk with explainable, machine-learned models, to provide creditors with better insights on their commercial customers.
• Business ID Theft Score: This score leverages the breadth and depth of Experian’s 28M+ business records to reliably predict the probability of identity theft and third-party fraud in commercial accounts to help streamline application processing.
• Commercial First-Party Fraud Score: A machine-learned model that uses blended consumer and commercial attributes to deliver an actionable score that reliably predicts the likelihood of first payment default and credit abuse in commercial applications.

• Real-time access to millions of historical transactional records with detailed returned payment and collection status.
• Behavior insights from spending and payment frequency patterns.
• Real-time visibility of cash-sale and COD activity not typically captured in standard business reports.
• Expanded data points engineered to remove uncertainty, supporting confident credit determinations.

• The predictive metrics for each score align when generated on the existing systems (current state) versus the cloud (future-state).  
• The impact to scores is insignificant. Adjusting the use of scores in business strategies or score cutoffs is not required.
• SBCS, SBFE and blended score white papers will follow.

Key milestones:

• Validation white paper and artifacts – Q1 2024
• Validation clients – parallel testing window – February 2024 to October 2024 (Q1–Q4)
• Net Connect/API hub testing – Q2–Q3 2024
• Additional operational data enhancements – Q4 2024
• All clients transition to the cloud – October 2024

“Like consumers, small businesses rely on fair and accurate credit reports in order to access key services. But because it isn’t covered by the same laws that apply to consumer services, credit reporting for businesses is tremendously opaque,” said FTC Chair Lina M. Khan. “This FTC inquiry will shine a much-needed light on the credit reporting industry and the related challenges that small businesses face.”

Unlike credit reports for individual consumers, which are governed by the Fair Credit Reporting Act, there is no federal law that specifically outlines processes and protections available to small businesses when it comes to credit reporting. This can make business credit reporting hard to understand, and it can be particularly difficult for small businesses to navigate how to correct errors or omissions in their credit reports in a timely fashion, the FTC claimed.

“These reports can significantly affect small businesses, potentially impacting the terms on which they can obtain the goods, services, and equipment they need to stay in business,” the FTC said in its announcement. “Because many of these credit reporting companies start developing a company’s credit report at the time it incorporates, tapping public records and other available financial data, business owners may not even be aware a report about them exists. Sometimes small businesses only discover they have a credit report when they are denied credit by a supplier.” 

The Commission’s inquiry will examine multiple aspects of how information is collected and processed for business credit reports, how the reports are marketed, and how and whether the credit reporting companies address factual errors in the reports. In addition to information about these topics, the orders also require credit reporting companies to provide information on services they provide to businesses to monitor or enhance their own credit reports.

Notably, 19 of 223 industry segments report more than 10% of their aging dollars are 90+ days past due – down from 25 industry segments one year earlier.

“The data indicates continued progress for economic recovery. While some industries are still reporting significant slowness and payment delinquency, there are industry segments exhibiting signs of growth, such as their accounts receivable performance,” said William F. Balduino, president and COO of the Credit Research Foundation.

The top industries that paid more than 90 days late during the fourth quarter f 2021 (Oct. 1 – Dec. 31), include:

• Misc. publishing
• Nonresidential construction
• Construction – general contractors & operative builders
• Manufacturing – oil/gas field machinery
• Manufacturing – electrical equipment/supplies
• Wholesale medical/hospital equipment

See the D&B/CRF report.

The blog post includes:

• The foundation of credit portfolio management.
• Credit scores.
• Comprehensive vs. summarized reports.
• Sound credit policies.
• Alerts.
• Collecting outstanding debt.
• Fraud.

View the Experian guide.

“Hyper-accelerated digital transformation efforts have dominated every industry and it is critical that companies large and small evolve their finance technology in order to keep pace in a digital-first world,” said Brian Alster, general manager of finance & risk business for Dun & Bradstreet. “Dun & Bradstreet continues to grow its finance solutions portfolio with market leaders such as FIS so that we can deliver advanced data and insights-driven solutions that help clients modernize their credit-to-cash processes – creating a digital-forward workforce that can identify risk and operate in a more collaborative and efficient manner.”

D&B Receivables Intelligence combines FIS GETPAID, a fully integrated, web-based accounts receivable software solution, with Dun & Bradstreet’s commercial data and risk-based insights – powered by its Data Cloud containing over 455 million businesses worldwide – to streamline AR processes and help companies provide better customer experiences so that they can get paid faster.

“Driven by an innovation-first mindset, FIS is focused on simplifying banking, payments and investments for all,” said Kelly Beatty, president of payment solutions at FIS. “Together, we will join our advanced AI-powered GETPAID automation platform with Dun & Bradstreet’s data and analytics so that a larger market of clients can experience the next generation of accounts receivables with improved cash flow and reduced risk.”

The fully integrated, cloud-based accounts receivable software solution offers collections management, dispute workflows, customer portals, dashboards, and reporting to help clients:

• Automate manual processes and create a collaborative environment for dispersed AR departments.
• Automate the collections and disputes process by combining Dun & Bradstreet’s data and insights with an advanced AI-driven business rules engine to provide risk-based strategies and portfolio segmentation.
• Create a safe and secure portal that allows customers to view account statements and balances, raise issues and make payments so companies get paid faster.

Clients who choose D&B Receivables Intelligence, powered by FIS GETPAID, will also receive white glove service from a dedicated professional services team, helping to reduce implementation time so that they can get up and running faster.

To find the best credit solutions for your specific needs, speak with your NACM North Central representative or email info@nacmnc.com.

The Q2 2021 reports shows that 26 of the more than 230 industry segments report more than 10% of their aging dollars are 90+ days past due. This reflects pre-pandemic levels. At the height of the pandemic in Q2 2020, for example, 45 industries reported more than 10% of their aging dollars were severely delinquent.

View the full D&B report.

“In this report we document an important aspect of the relationship between commercial and consumer credit for small businesses: the fact that information on some commercial credit is reported, or furnished, to consumer credit bureaus and winds up on consumer credit reports,” the report says.

The CFPB’s analysis reveals that, in an average quarter, more than 2.8 million consumers’ credit reports contain information about commercial or business credit products. In the study’s timeframe, between 2012 and 2019, more than 1,300 lenders provided commercial credit information to at least one nationwide credit reporting agency each quarter. Commonly reported business products included on consumer reports include: business credit cards, business loans, commercial installment loans and agricultural loans.

According to the CFPB, the number of reported tradelines represents a small fraction of commercial loans. Nearly 90 percent of banks do not report any commercial products to consumer bureaus. Those that do report are often inconsistent, reporting only seriously delinquent accounts. This inconsistency can be problematic.

“This furnishing behavior can have important implications for the consumer credit reports of business owners,” the CFPB wrote in a recent blog post about the survey. “Given the variety of reporting strategies, borrowers may not be aware of how commercial credit will affect their consumer credit reports when applying for business loans. Some reporting strategies can also only have negative effects on a business owner’s consumer credit. When lenders only report delinquent accounts, for example, this does not allow business owners to benefit from a satisfactory payment history.”

Read the CFPB’s full report.

Intelliscore Plus V3 is designed to help users assess risk, reduce slow payments and write-offs, and improve efficiency. The new version offers a 36% improvement in score performance over the previous model and a 50% improvement compared to a consumer-only model.

The Financial Stability Risk Score V2 is designed to help companies quickly identify businesses at the highest risk for failure and payment default. It uses payment data such as severely delinquent payments of 61+ and 91+ days, high credit line use, and public records, including tax liens, judgments and bankruptcy filings. The new version offers a 40% improvement in the Machine Learned model, higher performance in the 20^th percentile bad captures and offers longer timeframes with a projection of 24 months, up from 12 months.

Learn more about Intelliscore Plus V3 and Financial Stability Risk Score V3, and watch for more information about transitioning to the new models beginning in late August and continuing throughout 2021.

Get an overview of the power of blended scores in the latest Fast Fundamentals video from Experian:

Ask your NACM North Central representative or contact us at (763) 253-4300 or info@nacmnc.com to find the credit reporting solution that's right for you.

Ask your NACM North Central representative or contact us at (763) 253-4300 or info@nacmnc.com to find the credit reporting solution that's right for you.

• Onboarding an Appropriate Balance of Risk: A prolonged period of economic prosperity and minimal bankruptcies may have influenced the day-to-day credit policy approach, allowing more risk into the portfolio than would be prudent in a slow growth or recessionary economy. Reassess your company’s credit policy to recalibrate the portfolio risk profile for new and existing customers.
• Setting Proper Credit Limits: Use this opportunity to realign credit limits. Make sure they are informed by the credit exposure you have for the entire global corporate hierarchy for that customer. Consider adjusting credit limits (up and down) based on the individual risk assessment of that customer.
• Establishing Appropriate Terms: Evaluating the potential risk of each new opportunity or customer renewal will help realign your credit terms based on the probability the customer will pay on time and within terms.
• Monitoring Portfolio Risk: Perhaps more urgently, D&B advises to also consider deploying credit risk monitoring of the entire global portfolio to pick up on pockets of weakness that could result bad debt losses from potential bankruptcies.

D&B also put together this on-demand webinar to guide NACM members using its solutions to help them implement these suggestions:

Business Resources Website
The newly launched Look Ahead 2020 website was developed to help businesses prepare to manage increased attacks, continue to push toward digital banking and understand regulatory changes as businesses find their footing in this evolving financial services landscape. 

COVID-19 U.S. Business Risk Index
This new risk index can help business risk professionals better understand the impact that the pandemic may have on commercial operations based on several key factors. This methodology combines business risk, anticipated impact on business industries and real-time COVID-19 case data to help businesses better simulate various impact scenarios down to the state level to help develop relevant strategies.  

BusinessIQ 2.0 has modern, user-friendly functionality and a new side navigation menu. The application includes OneSearch, Experian’s unique search and match tool to help users access the right business information quickly with minimal data input. 

Using BusinessIQ 2.0, credit managers can:

• Get instant access to Experian’s commercial database, which covers 99.9 percent of all U.S. businesses in more than 225 countries.
• Monitor for high-risk activity so you’re not caught off-guard.
• Reduce application turnaround times by automating your approval policies.
• Work to reduce bad debt through advanced analytics and custom modeling.
• Expedite payments by prioritizing accounts.

For more information about BusinessIQ 2.0 and other tools from Experian and other leading credit information providers, contact your NACM North Central representative. 

• Same Day Reports are now available in 62 countries.
• Developed profiles are now delivered in the same digital format as online Small and Extended Reports.
• New Small and Extended developed profiles are easy to order in either BusinessIQor the GDN API and available in 253 countries, territories and dependencies.
• Archived developed profiles are instantly available.
• Extended developed profiles will be delivered in as little as one to three business days.

For help finding the right international credit solution to match your needs, speak with your NACM North Central rep. 

“Providing our customers with the option of combining consumer data and small business data with the innovative, machine-learning based technology present in the Commercial Insight Delinquency Score will redefine the U.S. commercial risk management market," said Scott Spencer, senior vice president and general manager for U.S. Commercial Services at Equifax. "Results from our analyses have demonstrated up to a 19 percent lift in predictability of risk versus other blended scores, and up to a 33 percent increase in scoreable businesses over non-blended scores. These incredible results will help our customers make more informed decisions and drive the next wave of growth within their businesses.” 

The Commercial Insight Delinquency Score output is based upon: 

• Equifax CFN database, which not only includes traditional payment performance data, but also adds other important data to the mix, such as business owner and identity. It includes:  approximately $300 billion in outstanding balances; over 1,400 commercial payment data portfolios; and up to 5 major data categories beyond the traditional credit bureau.

• Trended data, which provides predictive insights into the future financial path of a business, as well as past financial behaviors, giving lenders valuable insight into spending patterns. These patterns significantly increase predictiveness that helps lenders mitigate risk more effectively.
• NDT (NeuroDecision Technology), an Equifax-exclusive, risk modeling solution that blends the advanced machine-learning technology of neural networks allows a lender's credit scoring system to generate adverse-action reason codes with understandable explanations of resulting scores.

Powered by the CFN and leveraging NDT and trended data, the new risk score helps customers achieve profitable growth by increasing access to capital and services for American small businesses. Simply put, it will allow customers to lend more intelligently to a greater number of qualified borrowers.

For more information, contact your NACM North Central representative.

April 16 was the deadline for Experian, Equifax and TransUnion to remove tax lien data from consumer credit reports under National Consumer Assistance Plan requirements. To help clarify what these changes mean for commercial credit reports, Brodie Oldham from Experian recently addressed a few important issues. 

Core Credit Data

“The data that had the most impact from the [NCAP] study was public record data; judgments and liens for consumers that weren't updated or didn't have all of the personal identifying data necessary to meet the guidelines.”

Effect on Commercial Credit Data

“The impact with the public record information is really when we're evaluating a business owner guarantor using the consumer credit information where public record data has been removed.”

Effect on Commercial Blended Scores

“With the blended scores you would expect that if we remove some of the consumer derogatory information in public records that the score would go up. And we saw a mean lift to about .03 percent, so very small. In the performance of the blended generic credit scores in their evaluation and capture of those delinquent accounts.”

See Experian’s blog post for more detailed information. 

To help companies successfully meet the challenges of the increasingly complex regulatory environment, Experian created Business Compliance Insight. Whether you’re evaluating merchants, suppliers or customers, Business Compliance Insight provides a one-stop solution that helps identify possible regulatory, reputational and fraud risk associated with new accounts.

Business Compliance Insight helps analysts quickly conduct manual reviews by bringing together intelligence from multiple data sources on businesses and potential beneficial owners in one easy-to-read report, to be used as part of a complete investigation. Business Compliance Insight:

• Gives a single point of access for a preliminary review.
• Supports business customer identification requirements.
• Determines possible regulatory watchlist matches and government sanctions for the business and business contacts identified in the report.
• Establishes potentially undisclosed beneficial owners.
• Furnishes industry information and business structure for risk assignment.
• Assesses business financial stability.
• Pinpoints affiliates and high-risk conditions.
• Provides insights into a history of complaints filed against the company.

For information about Business Compliance Insight or other fraud and regulatory solutions from Experian, talk to your NACM North Central rep. 

Sales reps need the freedom to pursue prospects in the field with a reasonable assurance their efforts won’t be wasted because the credit department later identifies them as high credit risks. Fortunately, solutions are available to strike a better balance between enabling the sales team to pursue prospects and enforcing credit policies.

NACM North Central member Apogee Enterprises Inc. recently began using Experian’s BusinessIQ Mobile smartphone app to give the sales reps for its Tubelite business unit a new tool to prescreen prospects.

“For about the previous 12 months, we were looking for ways to help our field sales people to not have to get ahold of the credit department or wait for us to return information to them when looking at prospective customers,” said Jerry Drake, CCE, director of credit and collections for Apogee. “So, when we learned about BusinessIQ Mobile, we were immediately interested.”

In short, BusinessIQ Mobile allows users to quickly evaluate prospective clients’ risk profile anywhere. It helps companies overcome three common challenges:

1. Field sales teams need more effective tools to pursue the right prospect. Sales people don’t want to spend long hours pursuing a prospect only to learn later that the credit department won’t extend credit.
2. Friction between sales and credit departments. Credit managers are often seen as the “sales prevention specialists.” They are often put in a position of enforcing credit policies after the initial sales engagement.
3. Competitive threats and a poor customer experience. Evaluating risk on new customers can be time-consuming. Any delays in your decision can result in your prospect looking to your competitors for alternatives.

“In the past, sales reps might send us five to 10 names of prospects to look at before traveling,” Drake said. “Those ‘quick checks’ took time away from our credit people’s normal tasks. But it is good for sales to know whether prospects will be bona fide clients or present an approval process. Nobody wants them to waste their time developing an account if it’s likely to be rejected.”

BusinessIQ Mobile provides a fully customizable solution that leverages Experian’s data and the company’s unique credit policies to give sales people information they can use to target their sales efforts on the right prospects. Accessible on iOS and Android devices, BusinessIQ Mobile allows the credit department to define the specific information available to sales reps.

For Apogee’s initial use, sales reps are given an indication whether a prospect is likely to be approved for credit or may present a problem. The final approval or denial is still in the hand of the credit department after a formal review, but sales reps can use the app to confidently pursue prospects with the best potential for approval.

“We’re keeping it as simple as possible to start out and may expand it further once we’re completely comfortable with it,” Drake said. “We’re not giving our sales people intimate details – just enough information so they know whether someone is a very good prospect from a credit standpoint or may present a challenge. We’re not formally turning anyone down, but we’re letting the sales people know they should only pursue it further if they feel there’s a great market potential.”

Companies may customize the app to provide a decision to include an approval or denial notice along with a credit limit recommendation – all based the company’s credit policies and Experian’s data.

Following Apogee’s initial test using a few tech-savvy sales people in the Tubelite business unit, the company plans to expand usage to the entire Tubelite sales team. If the company finds the solution meets its goals as expected, a full rollout to all business units will follow.

 Contact your NACM North Central rep or email info@nacmnc.com for more information.

Comprehensive, intuitive and dynamic, D&B Credit delivers Dun & Bradstreet’s industry-leading data and analytics in a modern, user-friendly platform. With D&B Credit, you can get deeper insights into your business partners and make smarter credit decisions, faster.

D&B Credit helps you maximize the insights from credit reports by giving you:

• A clear and customizable view with tagging that lets you flexibly organize, monitor and report on your customer portfolio.
• A normalized view of data and analytics as well as multiple languages and currencies.
• Easy-to-understand analytics and scores powered by the world’s largest commercial database.
• A modern and intuitive interface with simple search and the ability to filter.

Talk to your NACM North Central rep to learn more about D&B Credit.

To help companies monitor even more of their business partners, Experian has expanded its international alerts to include 25 alerts in eight Western European countries. Eight additional countries will be added soon.

These alerts include: ownership, business name and address changes; credit limit changes; balance sheet information; company status; and much more.

Contact your NACM rep or info@nacmnc.com for more details. 

With Dun & Bradstreet credit solutions, evaluating the most complete and current credit-risk insights is simpler and more efficient than ever. Comprehensive, intuitive and dynamic, this platform lets you make smart credit decisions faster. Keep a close eye on your key accounts and better monitor your entire portfolio, which gives you the information and time you need to drive growth by building valuable relationships with customers, partners, and colleagues. 

With powerful segmentation tools and personalized alerts, your entire team will be able to: 

• Tag customers for flexible organization, monitoring and reporting
• Segment customers by the characteristics that are important to you.
• View past 12-month trends in summary or detail form

Talk to your NACM North Central rep to learn more about D&B Credit!

Delivering the latest innovations, D&B Credit is a next-generation risk intelligence resource that’s intuitive and easy to use. D&B Credit empowers you with indispensable data and tools to be strategic growth drivers. With powerful segmentation capabilities and customized alerts, your entire team will be able to zero in on what’s important to uncover risk, identify opportunities and make effective decisions to drive profitable growth.

D&B Credit provides three primary functions:

• Intelligent Decision Making—Make decisions efficiently with streamlined reports containing critical summary information, and the ability to navigate deeper with just a click.
• Customer Portfolio Insight—Get a clear and customizable view, with tagging that lets you flexibly organize, monitor and report on your customers’ patterns and trends. 
• Real-time Monitoring—Configure as many alerts needed to effectively monitor customer financial health and be notified daily via emails, dashboards, and reports.

Talk to your NACM North Central rep to learn more about D&B Credit.