Credit Hacks + Sorting Hats: How Parlay is Rewiring Small Business Lending

Alex McLeod, founder and CEO of fintech Parlay, shares how her team is using AI to untangle the complexity of small business credit.

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Every few years, Washington starts talking tough on cutting red tape — and this time is no different. But beneath the headlines, what does deregulation really mean for financial institutions?

Bank Slate Consulting has teamed up with Balch & Bingham to write a white paper to help banks and fintechs separate the noise from the nuance. Phil Buffington and I are diving deep into how financial services companies can prepare for regulatory shifts without overreacting or falling behind.

We’re already gaining traction, as our commentary was featured in an American Banker BankThink column, and I just published a preview in the Forbes Finance Council that features 10 steps to navigate the so-called “regulatory reset.”

Let me know what you think at paul@thebankslate.com.

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Let’s talk about fintech Parlay and co-founder and CEO Alex McLeod.

Community banks say they want to do more small business lending, but legacy systems and rigid scorecards often get in the way.

I recently caught up with Alex, whose startup has gained traction as an AI-driven loan intelligence system that’s rethinking how lenders evaluate small business credit. Unlike traditional platforms, Parlay doesn’t just process applications — it helps banks and credit unions approve more of them by uncovering hidden signals and improving decision-making in real time.

Alex and her team have solid financial backing, raising $1.3 million in early 2024 from a group led by Fenway Summer (which features former CFPB Deputy Director Raj Date) and recently bringing in $2 million in a funding round led by bank-backed JAM FINTOP.

In our Q&A, Alex shares:

• How Parlay aims to differentiate itself in a crowded area of fintech

• Lessons learned from founding three startups

• What she plans to do with Parlay’s latest round of fundraising

Let’s dive in.