Green Sheet interviews LexisNexis Risk Solutions' Amy Crawford

As economic uncertainty and shifting trade policies reshape the small-business landscape, lenders and payments professionals are looking more closely at how emerging pressures show up in credit behavior. In this Q&A, Amy Crawford, senior director of strategy for business risk management at LexisNexis Risk Solutions, discusses how tariff-driven cost dynamics are influencing credit usage, where traditional risk models may fall short and how alternative data can help identify stress earlier in the credit lifecycle.

Green Sheet: How are tariff-driven cost pressures changing the way small businesses use credit today and what early warning signs should lenders watch for?

Amy Crawford: Shortly prior to, and after, Liberation Day, many small businesses leveraged credit as both a shock absorber and an opportunity to front load inventory in anticipation of the increased cost of goods; however, the impact tariffs have had on small businesses has proven to be less than anticipated. 
Lenders should continue to watch for rising utilization, slower paydowns and repeated line increases, particularly in heavily impacted industries like transportation and warehousing.

GS: As pre-tariff inventory buffers run down, what specific disconnects are emerging between traditional credit metrics and a business’s actual financial health? 

AC: The biggest disconnection is timing. While a small business may show acceptable payment history, its cash flow may be weakening, inventory costs may be rising, and gross margins may be eroding faster than traditional credit files can detect.

GS: Why do traditional commercial credit files tend to lag real-time conditions, and how significant is that gap in the current environment?

AC: Commercial credit files tend to lag because they depend on reported information about trade data, payment performance and bureau updates. In fast-moving environments shaped by rising costs, trade policy changes and energy shocks, cost pressures can hit inventory and cash flow weeks or even months before they show up as delinquencies. Alternative data helps close that gap.

GS:: What risks do lenders face if they rely too heavily on backward-looking credit data during periods of economic volatility?

AC: The primary risk is false confidence. When used as a retrospective view of SMB performance during past downturns, backward-looking data can be valuable in identifying business types that historically weather economic stress. However, if organizations strictly use backward-looking data to assess an individual business’s apparent stability, lenders may be exposed to missed payments, fraud risk or merchant failure.

GS: What types of supplemental or alternative data are proving most useful in identifying emerging stress earlier in the credit lifecycle?

AC: The lender who makes the most informed, data-driven decision has an advantage especially in the current economy. The most valuable supplemental data reflects a business’s operating reality: bankruptcies, liens, judgments, UCC filings, cash-flow signals, transaction data, and changes in digital business behavior. The key is selecting timely, relevant signals that align with an institution’s specific risk tolerance.

GS: How can ISOs, acquirers, and other payments professionals incorporate these insights into their underwriting or merchant risk strategies?

AC: Tariffs should be treated as one of several merchant risk signals, though anticipated impacts have so far exceeded actual outcomes. More broadly, payments professionals should thoughtfully integrate alternative data alongside traditional credit data to make more informed decisions through scores, attributes or raw data integrated into proprietary risk models.

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