Prism Data Technologies has raised $20 million in Series A funding to expand its cash flow underwriting technology and help lenders assess borrowers using bank transaction data. The New York City-based fintech startup plans to invest in its enterprise platform, data infrastructure, artificial intelligence (AI) technology, and commercial teams to support wider adoption by banks.
Story Ventures led the funding round, with participation from FINTOP Capital, Core Innovation Capital, Obvious Ventures, 1st & Main Growth Partners and Mana Ventures. The latest investment brings Prism Data’s total funding to more than $25 million, following its $5 million seed round in 2023.
How Prism Data Plans to Use the Funding
Prism Data will use the new capital to expand its cash flow analytics platform, strengthen its computing infrastructure, develop its AI-powered technology and support deployments with traditional banks.
The company uses open banking data to analyze consumer bank transactions and provide lenders with additional information about a borrower’s ability to repay loans. Its technology is designed to help financial institutions assess people whose financial situations may not be fully reflected in traditional credit scores.
The startup reports that its monthly API transaction volume has increased more than 100 times over the past two years, highlighting growing demand for its technology.
Prism Data Launches REFRACT AI Engine
Alongside the funding announcement, Prism Data introduced REFRACT™, an AI-powered transaction categorization engine. The system is designed to recognize, analyze, and categorize bank transactions using a proprietary dataset of more than 30 billion transactions.
The technology will support the development of new credit scores and financial analytics tools. By organizing transaction data into useful financial insights, Prism Data aims to help lenders better understand borrowers’ income, spending habits and cash flow.
Its flagship CashScore® model provides creditworthiness metrics based on bank account activity, offering lenders an additional way to evaluate applicants beyond conventional credit scoring methods.
Major Banks and Fintech Lenders Use Prism Data
Led by CEO Jason Rosen, Prism Data develops cash flow analytics and credit risk underwriting software for financial institutions.
The company reports that its platform serves three of the five largest fintech lenders and six of the ten largest digital banks in the United States. Its technology is also integrated into financial data and credit infrastructure networks involving companies such as Equifax, Plaid, LexisNexis, and Synchrony Financial.
These relationships could help Prism Data expand its reach as more lenders explore alternative ways to evaluate credit risk.
Why This Funding Matters for Fintech
Traditional credit scores remain important in lending, but they may not fully capture the financial circumstances of gig workers, freelancers, and people with irregular income.
Cash flow underwriting gives lenders another source of information by examining actual bank transactions and patterns in income and spending. This can help financial institutions build a more detailed picture of a borrower’s finances.
With its new funding and REFRACT AI engine, Prism Data is positioning itself to serve lenders looking for more detailed, data-driven credit assessments. Its next phase of growth will focus on expanding enterprise adoption and supporting deployments across the traditional banking sector.
As financial institutions continue investing in AI and open banking technology, Prism Data’s funding round highlights the growing interest in using real-time financial behavior to improve credit risk assessment.
