explainer

How does the Universal Credit Score assist underserved traders?

The Universal Credit Score acts as a bridge between a trader’s operational performance and financial eligibility, specifically designed to help SMEs and first-time exporters overcome traditional barriers to funding. By converting trust intelligence into financial data, the score allows lenders to move beyond static financial statements and evaluate the actual health of a trade.

The score assists underserved traders in the following ways:

1. Removing Legacy Bias

Traditional banking often relies on long-standing history and extensive balance sheets, which can disadvantage smaller or newer participants. The Universal Credit Score democratises access to finance by ensuring creditworthiness is measured by real trade data and current behaviour rather than privilege or legacy bias.

2. Assessing "Inside the Trades"

Lenders are empowered to look beyond balance sheets and instead assess risk at the trade level. The score provides deal-specific signals throughout the trade lifecycle—from the initial RFQ and contract to shipment and settlement—allowing banks to finance individual transactions that are demonstrably secure.

3. Reducing Collateral Requirements

A primary obstacle for underserved traders is the high level of collateral typically required by banks. Because the scoring engine evaluates trust profiles and transaction behaviour in real time, it provides lenders with enough confidence to offer financing with reduced collateral dependency.

4. Improving Financial Terms

The score enables risk-based pricing, meaning traders with high trust and performance marks can access better capital pricing. Rather than being grouped into a broad, high-risk category, underserved traders can use their verified data to secure more competitive rates.

5. Speed of Execution

For small businesses, market opportunities can disappear quickly. The Universal Credit Score facilitates real-time credit decisions and faster credit approvals, allowing underserved traders to act on deals before market conditions change.

Analogy

The Universal Credit Score is like a modern fitness tracker for a business. In the past, to get "health insurance" (finance), a bank might only look at your age or family history (balance sheets and legacy). With this score, the bank can see your actual daily steps, heart rate, and performance (real-time trade data). This allows even a young or small business to prove they are "fit" and reliable, earning them better rates and quicker support based on their actual activity rather than just their background.