Prism Data, a US-based provider of cash flow underwriting and credit analytics technology, has secured $20m in Series A funding as banks and lenders turn to real-time banking data to judge creditworthiness.

Story Ventures led the round, which also drew backing from FINTOP, Core VC, Obvious Ventures, 1st & Main Growth Partners and Mana Ventures.

With the $5m seed round it disclosed in 2023, the business has now raised more than $25m in total.

Prism plans to use the money to keep investing in its technology, proprietary AI infrastructure and data science teams. That work includes building a new generation of its CashScore models. The company also intends to grow in consumer and small business lending, strengthen its position in the US and Canada, and eventually take its products to international markets.

Alongside the raise, Prism has launched REFRACT, an AI-driven engine for categorising transactions. It was trained on the company’s own dataset of more than 30 billion bank transactions.

Conventional tools label transactions using merchant names or keywords. REFRACT instead uses separate consumer and commercial models to work out what each payment is actually for. Drawing on contextual signals, it can tell apart activity that looks the same on a statement, such as earnings versus borrowed money, refunds versus income, and purchases versus transfers, even when one payment platform is involved in all of them.

According to the firm, benchmark tests show double-digit percentage improvements in accuracy over its earlier models. The engine can process data from any open banking aggregator, from banks’ own deposit accounts, and from PDF statements in the US and Canada.

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