Newity Expands Lending Capacity for Community Banks with AI Technology
Lending service provider, Newity, which played a significant role in transforming Northeast Bank into one of the leading Small Business Administration (SBA) lenders in the country, is utilizing an $11 million venture capital investment to broaden its platform. The Chicago-based company received the funding from a group spearheaded by venture capital firm CMT Digital and plans to use this investment to expand its artificial intelligence (AI)-driven underwriting infrastructure. The ultimate aim is to partner with more banks and assist them in managing small-balance lending efficiently.
AI-Driven Growth for Small-Balance Lending
Newity has been instrumental in aiding its longtime partner, Northeast Bank, to significantly boost its SBA 7(a) origination volume. The volume increased from $2.8 million in 2022 to a staggering $1.3 billion by 2025, highlighting the efficiency and scalability of Newity’s services.
“We get a lot of inbound calls from other banks that have seen what we did with Northeast and would like us to help them tackle small-balance lending,” said Newity co-CEO Luke LaHaie. He further added that the company’s goal for the year is to grow these relationships.
Streamlining Operations with AI
Newity’s new AI technology has revolutionized its platform, allowing the company to underwrite more loans without necessitating a corresponding increase in staffing. “You have, say, 300 to 500 different data points used to underwrite a loan,” LaHaie said. “The beauty of the new technology we’re launching is it looks at all that stuff at once, so we can get a very quick answer to that customer and practically underwrite their file real time as they’re uploading [information] and working with us.”
LaHaie continued: “You don’t have to worry about reading the 100-page background check. It’s being fed through all of the checks that you want every time…This helps you add scale, for sure.”
Planning for the Future
While the initial focus of the company is on SBA 7(a) lending, Newity has plans to extend the use of its new AI technology to conventional loan types. The company has no intentions of reducing its collaboration with Northeast Bank, with their contract extending until 2029. “Our view is very much: how do we continue to grow and optimize what we’re doing,” said LaHaie.
Sam Hallene, a CMT Digital partner, praised Newity’s ability to navigate the complex lending markets swiftly and efficiently. He expressed that their investment aims to support the next phase of growth – scaling origination through automation and expanding long-term liquidity options for small business credit.
Newity’s innovative use of AI technology in the lending service sector renders it a significant player in the industry. “Even early last year…what we’re building wouldn’t have been possible,” LaHaie said. “The technology just didn’t exist and function the way you need it to now. It is kind of incredible just how fast it’s evolving, improving and changing.”
As the company continues to grow and leverage AI to enhance its services, it’s clear that Newity is set to make a big impact in the banking industry, helping small businesses access the funds they need quicker and more efficiently. This aligns with their mission of adding scale and optimizing operations for community banks across the nation.
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