Intuit had inked a partnership with two of the top five lenders to small and medium-sized businesses (SMEs) in the US in terms of volume, Capital One and Wells Fargo, for a pilot program that allows financial institutions to understand the creditworthiness of its customer base. The Financial Times noted in its article that the partnership also allowed the US software company to sell its accounting software product QuickBooks to SMEs.
The program, said the FT article, is aptly named QuickBooks Financing. In the eight months since it went live, the program have facilitated around 400 loans totaling USD13 million. FT said the partnership will be launching the progrtam in Canada in the next two months.
Intuit chief executive Brad Smith explained the rationale behind the concept of the program, "Most small businesses borrow from their family and they've maxed out their credit cards. We're able to go inside your small business accounting, we can look at how many bills you've paid on time, who owes you money, and how your cash flow looks, and we've been able to write algorithms that will predict your credit risk."
A potential borrower could visit the QuickBooks platform for free, as explained in the FT article. The borrower will need to answer 15 questions in order to be matched to a lender. Should the business of the borrower is among the 1.2 million QuickBooks customers who had allowed to have their data to be uploaded to servers of Intuit, the borrower will be able to opt in for Intuit to analyze the data of the borrower's business. In return, the borrower will be able to obtain preferential rates from the banks.
The partnership of Intuit, Capital One and Wells Fargo, said FT, was one clear sign that software providers and financial institutions are utilizing cloud computing and data analytics in order to improve their services at lower risk.
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