Using commercial share of wallet to make lending decisions

Abstract

Commercial size of spending wallet (“CSoSW”) is the total business spend of a business including cash but excluding bartered items. Commercial share of wallet (“CSoW”) is the portion of the spending wallet that is captured by a particular financial company. A modeling approach utilizes various data sources to provide outputs that describe a company's spend capacity. Banks and lenders can use CSoW/CSoSW to determine who to lend to and who to deny credit to, as well as for pricing loans and other products in a dynamic way. Banks and lenders can also determine which customers should be retained, as well as identify loans which are likely to default.

What is claimed is: 
     
         1 . A method comprising:
 determining, by a computer-based system configured for managing lending decisions regarding a company, a product of operating expenses and a cardable operating expenses ratio to create cardable operating expenses;   estimating, by the computer-based system, a commercial size of spending wallet of the company at least based upon the cardable operating expenses and costs of goods sold; and   determining a lending course of action regarding the company based on the commercial size of spending wallet of the company.   
     
     
         2 . The method of  claim 1 , wherein the estimating is further based upon at least one of known financial statement data of the company, total known business spending of the company, and a model of industry spending patterns. 
     
     
         3 . The method of  claim 1 , wherein the cost of goods sold and the operating expenses are identified from at least one of individual corporate data and aggregate corporate data. 
     
     
         4 . The method of  claim 1 , wherein the cardable operating expenses are identified from the operating expenses. 
     
     
         5 . The method of  claim 1 , wherein the cardable operating expenses ratio is identified from the aggregate corporate data. 
     
     
         6 . The method of  claim 1 , wherein a model of industry spending patterns is used to infer financial statement data and spending data that is not known. 
     
     
         7 . The method of  claim 1 , further comprising modeling, by the computer-based system, industry spending patterns using the individual corporate data and the aggregate corporate data, including financial statement data. 
     
     
         8 . The method of  claim 1 , wherein the determining comprises whether to lend to the company based on the commercial size of spending wallet of the company. 
     
     
         9 . The method of  claim 1 , wherein the determining comprises:
 determining whether the profits of the company are likely to increase based on the commercial size of spending wallet of the company; and   targeting the company for products in response to the profits of the company likely to increase.   
     
     
         10 . The method of  claim 1 , wherein the company is an existing customer. 
     
     
         11 . The method of  claim 1 , wherein the estimating comprises outputting the commercial size of spending wallet as a score. 
     
     
         12 . The method of  claim 1 , wherein the determining comprises revoking existing unused lines of credit of the company at least based on the commercial size of spending wallet of the company. 
     
     
         13 . The method of  claim 1 , wherein the determining comprises:
 identifying loans related to the company that are likely to default based on the commercial size of spending wallet; and   selling the identified loans.   
     
     
         14 . The method of  claim 1 , further comprising estimating a share of wallet for the company. 
     
     
         15 . A system comprising:
 a processor configured for managing lending decisions regarding a company;   a tangible, non-transitory memory in communication with the processor;   a calculating module in communication with the processor and configured to determine a product of operating expenses and a cardable operating expenses ratio to create cardable operating expenses;   an estimating module in communication with the processor and configured to estimate a commercial size of spending wallet of the company at least based upon the cardable operating expenses and costs of goods sold; and   a determining module in communication with the processor and configured to determine a lending course of action regarding the company based on the commercial size of spending wallet of the company.   
     
     
         16 . The system of  claim 15 , wherein the estimating is further based upon at least one of known financial statement data of the company, total known business spending of the company, and a model of industry spending patterns. 
     
     
         17 . The system of  claim 15 , wherein the cost of goods sold and the operating expenses are identified from at least one of individual corporate data and aggregate corporate data. 
     
     
         18 . The system of  claim 15 , wherein the cardable operating expenses ratio is identified from the aggregate corporate data. 
     
     
         19 . An article of manufacture including a non-transitory, tangible computer readable storage medium having instructions stored thereon that, in response to execution by a computer-based system configured for managing lending decisions regarding a company, cause the computer-based system to perform operations comprising:
 determining, by the computer-based system, a product of operating expenses and a cardable operating expenses ratio to create cardable operating expenses;   estimating, by the computer-based system, a commercial size of spending wallet of the company at least based upon the cardable operating expenses and costs of goods sold; and   determining a lending course of action regarding the company based on the commercial size of spending wallet of the company.