Innovations for Underwriting Minority and Small Business Enterprises


FinRegLab is investigating ways to improve credit access for minority-owned companies and other underserved small businesses through the use of non-traditional data sources and mission-based lenders.

The research project will help evaluate efforts by minority depository institutions, community development financial institutions, and other community-based lenders to explore ways that bank account records and other sources of cash-flow information can be used to scale their lending operations. It will also evaluate the predictiveness of different credit attributes using loan performance data from larger fintech lenders.

FinRegLab expects the project to be the first in a series of studies focusing on ways that data and technology can improve financial services for small businesses, which create two out of every three net new jobs in the U.S. and can be a critical path for wealth-building among households of color. The current project will have three primary components over the next two years:

Mission-Based Lenders’ Adoption

In one workstream, FinRegLab is working with Emmanuel Yimfor of Columbia University to structure studies of pilot programs by minority depository institutions, community development financial institutions, and other smaller lenders to explore the potential to scale their lending to minority business enterprises through use of automated data flows, non-traditional data sources, and partnerships with fintechs. FinRegLab will start the workstream with a qualitative report to highlight lessons learned through the pilots and past initiatives.

Empirical Research

FinRegLab is partnering with Sabrina Howell of New York University to analyze data from fintech lenders who have been using automated sources of cash-flow data since before the COVID-19 pandemic. The analysis will compare the predictiveness of a range of metrics distilled from automated cash-flow data as well as traditional credit scores and report information to identify which data points are most useful in underwriting loans to minority business enterprises and other types of small businesses.

Stakeholder Engagement

The third workstream involves engaging market actors, policymakers, advocates, and other stakeholders to explore the implications of the research for market practices and public policy going forward. FinRegLab will use webinars, podcasts, and convenings to share findings with key audiences.

The project will be structured to facilitate later empirical analysis of loans from the pilot programs as they conclude. Additional components may be added over time to assess the potential for mission-based lenders to combine “high tech” and “high touch” approaches and to increase the scale of their operations substantially through partnerships with fintechs.

Funding for this project is provided by:

This project is funded by a grant from the U.S. Department of Commerce, Minority Business Development Agency, and with support from Visa. Plaid will provide free account connectivity services to participating mission-based lenders to allow loan applicants to authorize their account data to be accessed for underwriting.

Contact Us

FinRegLab, 1701 K ST NW, Suite 1150, Washington, DC 20006

1 (202) 951-4088 /

Kelly Thompson Cochran

Deputy Director and Chief Program Officer

Prior to joining FinRegLab, Kelly helped to stand up the Consumer Financial Protection Bureau, where she served most recently as the Assistant Director for Regulations. In that capacity, she oversaw rulemaking and guidance activities under the Dodd-Frank Act, Electronic Fund Transfer Act, and various other federal consumer financial laws. Kelly previously was counsel at WilmerHale, where she advised financial institutions on a wide range of legal and regulatory matters including product development, compliance, enforcement, and litigation. Kelly also conducted research on financial services innovation, community reinvestment, and other topics at the University of North Carolina at Chapel Hill.

Karla Renschler

Senior Manager of Small Business Research

As FinRegLab’s Senior Manager of Small Business Research, Karla leads research initiatives to understand how innovations in lending to small businesses can drive financial inclusion. She brings extensive experience as a researcher across non-profit, management consulting, and private sector roles. Prior to FinRegLab, Karla worked in small business card lending at Capital One, designing credit policies to expand access to credit for subprime small businesses. She brings a passion for financial equity and inclusion and a first-hand understanding of the challenges industry actors face in applying innovations in underwriting. Karla holds a Bachelor’s degree in Political Science and Global Studies from UCLA, where she graduated summa cum laude with Departmental Highest Honors.

Paula Ochiel

Senior Research Analyst

Paula is joining FinRegLab as a Senior Research Analyst, facilitating and supporting qualitative and empirical research from design to execution, project management, and communication. She brings extensive expertise in helping data-driven organizations utilize data effectively to make informed decisions. Her experience leading cross-organizational projects to advance financial inclusion and her recent role as an Impact Manager at ICA, a non-profit Community Development Financial Inclusion (CDFI), demonstrate her commitment to promoting equitable access to financial and economic opportunities. With a background in international development, Paula is excited to bring her diverse experiences to FRL and contribute to its mission.

Related Publications

  • Consumer Financial Data: Legal and Regulatory Landscape

    FinRegLab partnered with the Financial Health Network, Flourish Ventures, and Mitchell Sandler to provide a working paper summarizing the current U.S. federal legal framework governing consumer financial data with the goal of laying a foundation for future policy analyses and discussions.

  • Data diversification in Credit Underwriting

    This update catalogues recent initiatives involving the use of non-traditional credit data, including cash-flow information. It considers how dramatic shifts in economic conditions due to the Covid-19 pandemic and mass movements for racial justice have increased incentives to adopt new data sources and models, but also created new market and policy challenges.

  • Technology Solutions for PPP and Beyond

    This Research Brief catalogues uses of new data and technologies to make it easier for small businesses to access federal Paycheck Protection Program (PPP) funds and other forms of credit. Solving PPP enrollment challenges is important to laying the foundation for a rapid and inclusive recovery and to building a more resilient small business sector…

  • The Use of Cash-Flow Data in Underwriting Credit: Market Context & Policy Analysis

    This report provides a detailed snapshot of the use of cash-flow data in U.S. consumer lending and the development of the system for transferring data between firms, in addition to analyzing policy and regulatory issues raised by cash-flow underwriting in both consumer and small business credit markets.

  • The Use Of Cash-Flow Data In Underwriting Credit: Policy Overview

    This overview highlights key themes from our longer market context and policy analysis, including outlining options for action by industry, regulators, and Congress.

About FinregLab

FinRegLab is an independent, nonprofit organization that conducts research and experiments with new technologies and data to drive the financial sector toward a responsible and inclusive marketplace. The organization also facilitates discourse across the financial ecosystem to inform public policy and market practices. To receive periodic updates on the latest research, subscribe to FRL’s newsletter and visit Follow FinRegLab on LinkedIn and Twitter (X). | 1701 K Street Northwest, Suite 1150, Washington, DC 20006