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Federal Reserve Bank of New York data shows that nearly one-third of business borrowers file an application with an online lender, a dramatic increase from 19% just two years earlier. Traditional financial institutions remain the more popular choice, but those odds are not trending in their favor. Speed of the credit decision is the most oft cited reason for this shift, pointing to members’ continued desire for convenience and the new market players’ success in harnessing automation to meet this demand.

Fintech firms have approached lending as a science, generally speaking, applying artificial intelligence to streamline what has long been a labor-intensive exercise for both underwriter and applicant. With the wealth of available data constantly expanding and algorithms growing more refined, the question becomes, to what extent can these decisions become purely formula driven?

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