Archive for 2023

Is AI Coming for the Industry’s Jobs?

“Let’s be honest, a lot of this AI to me is like a Black Mirror episode,” said Erica Gilerman, General Counsel at Triton Recovery Group. “It was something that three years ago when you’re first watching Black Mirror, you’re like, ‘Wow, that’s amazing,’ and suddenly it’s here.”

The most talked-about technology lately has been AI. The fast-paced, easy, and accessible tools that AI is giving life to have the rest of the world questioning how necessary humans will be for many business functions.

“I think anyone who says that jobs won’t be lost because of AI is not being honest,” said Shawn Smith, CEO at Dedicated Financial GBC, a commercial recovery firm.

Companies that are built straight from AI won’t have to cut back on hiring, Smith explained, but he believes that once more businesses begin integrating AI, the need for more people won’t be there.

“I think what you’re going to see more of is AI being leveraged instead of hiring more people,” said Smith. “They will be able to grow without needing to hire more and reallocate people to doing more of the connection piece and allow AI to do the process piece.”

Gilerman, at Triton, a firm that also does commercial recovery, believes that some roles cannot be fully replaced by AI.

“Will it fully replace people,” said Gilerman. “I don’t see that happening anytime soon, especially in our space.” An example she offered is the necessity of having humans oversee what an AI is doing when it comes to underwriting to make sure it’s not getting it wrong. She also thinks that AI could be useful in automating mundane tasks.

“And not in a way that is bad, but more so of busy work versus truly being able to delve deeper into what we need to get done and getting it done faster,” she said, “which is what I really think AI is going to assist us in, getting everything done faster.”

“Everybody used to type everything with a typewriter,” said Shmulik Fishman, CEO of Argyle, a fintech company that focuses on employment and income verification, “And when computers came out, there was a huge worry that everybody that was a typist, all those jobs would be eliminated, and that the office would have this huge decrease in the number of people inside of it. The exact opposite thing happened.”

This outcome could happen all over again.

“Humans have a really amazing ability to leverage tools to make their day better, and to graduate themselves to working on more important things that tools or computers cannot do for them,” Fishman said. “And I think a ton of that’s going to happen with AI as well.”

Connecticut Nears Passage of a Unique Commercial Financing Disclosure Bill

Connecticut’s General Assembly came one step closer to passing its own commercial financing disclosure bill when SB1032 passed the Senate on Monday. The State’s legislative session ends on June 7 so the House would have to also pass it by then in order to send it off to the governor.

Connecticut’s bill has several unique rules in addition to standard disclosures already seen in other states.

1. A provider shall not revoke, withdraw or modify a specific offer until midnight of the third calendar day after the date of the specific offer.

2. Providers and brokers must register with the Banking Commissioner.

3. No commercial financing contract shall contain any provision waiving a recipient’s right to notice, judicial hearing or prior court order in connection with the provider obtaining any prejudgment remedy, including, but not limited to, attachment, execution, garnishment or replevin, upon commencing any litigation against the recipient.

Given the likelihood this bill could pass, it has been added to deBanked’s state regulation map.

Capify Wins SME Lender of the Year Award

Specialist finance provider Capify were recently crowned SME lender of the year at the 2023 Credit Awards.

The awards, which took place at London’s prestigious Grosvenor House on the 1st June and were hosted by television’s Katherine Ryan, recognise innovation and best-practice in the financial services industry.

In a fiercely competitive segment, which included banks, fintechs, asset finance providers, invoice finance companies, and P2P businesses, Capify was recognised as the SME lender of year (up to £1m lend).

Reflecting on their win, John Rozenbroek, Capify COO/CFO said “This award is recognition of the amazing work the whole Capify team have undertaken over the past year and our commitment to serving the UK’s vital SME community. For many UK SMEs, access to finance can be a real barrier to growth and we are delighted that our innovative and flexible approach to serving this segment of the economy has been recognised”.

Capify’s Q1 2023 business confidence survey revealed that 55% of SMEs are uncertain in their ability to secure finance from their traditional banking partners. “This is where we step in”, Rozenbroek adds. “As an alternative lender, we pride ourselves on our agile yet responsible approach, enabling us to promptly provide the much-needed funds to this underserved audience. In fact, we can approve and transfer funds to the applicant’s account in as little as 24 hours.”
 
Launched in 2008, Capify was born out of the desire to offer small businesses an alternative way to quickly access responsible business finance when many firms were struggling to navigate the impact of the global financial crisis. With offices in the UK and Australia and approximately 120 employees, it continues to support smaller businesses with funding to meet the challenges and opportunities of today’s economic climate.

About Capify

Capify is an online lender that provides flexible financing solutions to SMEs seeking working capital to sustain or grow their business. Alongside its sister company, Capify Australia, the fintech businesses have been serving their respective markets for 15 years.

For more details about Capify, visit: http://www.capify.co.uk

Capify Media Contact:

Ian Wood, Marketing Director
iwood@capify.co.uk
0161 393 9536

ChatGPT Makes it Debut in The Secured Finance Market

“Based on the balance sheet provided, the business appears to have a healthy financial position,” the report states. This is the opening line of the written Financial Health Analysis conducted by OpenAI’s ChatGPT. From there it elaborates at length with all the relevant financial stats that an underwriter could ever dream of, even going so far as to recommend all on its own that recent tax returns, among other stips, should be requested to move forward.

What the world is coming to know as a chatbot, is capable of much, much more, according to Dave Kim, co-founder and CEO of Harbr, Inc. Harbr’s flagship product, IntakeIQ, is taking online application technology to new advanced places thanks to the introduction of real artificial intelligence. But there’s a right and wrong way to do this because keeping applicant information anonymous and secure is paramount.

“…security is massive, right?” said Kim. “Like you have to know going in that if you’re going to use a GPT or a Large Language Model that’s being hosted and you don’t have control of it yourself, that the data is 100% being used for machine learning.”

And along with security is the science of data input. Roughly speaking, the more information you send to ChatGPT the more it costs to spit out an answer. That means data not only needs to be secure but condensed down to such compact bits of input that the cost is acceptable and scalable. This is no domain for amateurs who think they can accomplish this with a basic monthly ChatGPT subscription. And Kim is no amateur.

“My background is in enterprise software development,” Kim said. A previous company he co-founded, GoInstant, was acquired by Salesforce for $70 million in 2012. Kim was already developing AI-driven technologies long before ChatGPT became known to the world, more recently in the commercial construction business. The aspect of invoices and payments combined with OCR technology soon evolved into a separate use-case where it could be used in financing like factoring and more. But their tech had to understand the niche particulars of the information it was analyzing.

“So we essentially started training a natural language processing model using machine learning techniques around those sorts of phrases and terminology for the construction industry,” said Kim. “So we were building that kind of tech first and then it became relatively easier when dealing with broader information in documents and other invoices that were coming in for not just construction.”

In 2022, Kim first encountered the capabilities of ChatGPT. He said that while the AI is great at creating a diversity of answers, the way they engineered their prompts with financial data produced consistent output. That’s what’s key. Harbr’s technology does a lot of the work on its own side first before sending off a highly secure, highly redacted, anonymized and reduction-optimized prompt to ChatGPT. The process can start with a pdf statement because it’s automatically OCR’d and analyzed first before any of this happens. Harbr isn’t able to view or retain any of the data and ChatGPT does not know anything identifiable about the applicant. Only the lending company is privy to the applicant’s info and the results. Setting this up for a lender can be accomplished very quickly.

The object isn’t to entirely replace underwriting, but to make it more efficient.

“Today we work with businesses that are in asset based lending, factoring, supply chain finance,” Kim said. “We’re starting to look at equipment, transportation, equipment financing and leasing. […] I think the entire secured finance market, there’s a fit here as the technology grows.”