Small businesses and low-income consumers cannot access affordable credit from traditional lenders

Underserved small business owners and consumers in emerging markets lack access to timely, affordable credit from banks due to strict collateral requirements, complex application processes, and limited credit history documentation. Traditional lenders view this segment as too risky, leaving them vulnerable to predatory lending or unable to fund growth, inventory, or emergency expenses. AI-powered microfinance platforms are emerging to fill this gap by using alternative data and algorithms to assess creditworthiness.