BILL Says AI Underwriting Cut Expected Loss Rate More Than 50% in FY26

Bill.com Holdings, Inc. (BILL) said on its 2026-08-19 earnings call that an AI underwriting model drove roughly 30% year-over-year growth in invoice financing volume and revenue in FY26, with the expected loss rate improving by more than 50%. Revenue for that business has never been disclosed on its own [1].

BILL sells financial software to small and midsize businesses in the United States. Its products handle accounts payable and accounts receivable for customers and manage day-to-day spend and expense reports through Divvy cards. Revenue comes partly from subscription fees and partly from a take rate on payment volume. Total revenue grew 13.8% year over year in the fourth quarter of FY26 [2].

Two places AI was deployed

The customer-facing deployment breaks approval work into individual agents. A W-9 agent collects and validates tax forms from suppliers, covering more than 40,000 organizations and collecting more than 240,000 W-9s end to end. An invoice coding agent launched in February is used by more than 60,000 companies and removes roughly 90% of the coding steps on a multi-line invoice. More than 175,000 businesses now use these agents.

The internal deployment is the invoice financing underwriting model. It reads how a business has paid and been paid inside the BILL network over time and uses those relationships to decide whether to lend and how much.

The quantified result sits on the underwriting side

Management's numbers are concentrated there: across FY26, invoice financing volume and revenue each grew about 30% year over year while the expected loss rate improved by more than 50% [1]. That is a specific quantified disclosure and an unusual one among peers, since none of BILL's direct competitors in accounts payable automation gave comparable underwriting figures this quarter.

At the company level, revenue did not change gear. Fourth-quarter growth of 13.8% sits inside the 13.5%, 14.4% and 10.4% range of the prior three quarters, and FY27 guidance calls for total revenue growth of 9% to 12% [2]. Invoice financing revenue appears nowhere as a separate figure in the FY2026 annual report or the four quarterly filings. It is grouped inside a larger transaction-fee product set, so the roughly 30% growth rate cannot be checked against filings. That same product set already grew 37% in FY25, before AI underwriting was mentioned [2].

Most of the margin improvement came from headcount

BILL's headcount fell from 2,364 at the end of FY25 to 1,683 at the end of FY26, a decline of 28.8%, broadly delivering a previously stated annualized gross savings target [3]. Explaining the quarter's profit beat, the CFO named accelerated workforce reductions first. The company described the reorganization as necessary to become an AI-native company, without saying how much of the work AI actually absorbed [3].

What holds and what does not

The underwriting model is demonstrably running. Management has disclosed the lending growth and loss-rate improvement it produces across several quarters, and agent usage on the product side has widened each quarter.

How much of the improvement comes from the model itself is not established. A loss rate cutting by more than half can also be achieved by tightening who gets funded and raising prices, and the CFO has previously described selecting risk tiers in invoice financing. The company discloses no vintage-level loss data, so an outside reader cannot separate model performance from a change in the borrower mix. Invoice financing's share of total revenue is also unknown, which is what would determine how much this application matters to BILL's overall results.

Application: Revenue and cost Stage: Mature Value realized: Moderate Confidence: Medium

Sources

[1] Drillr · Bill.com Holdings, Inc. (BILL) · 2026-08-19 · earnings call

"A few quarters ago, we introduced a new AI underwriting model to assist with our invoice financing applications. This new model is built on signals and patterns based on how businesses pay and receive payments within the bill network over time...We are seeing a material impact on our invoice financing business. Both volume and revenue grew approximately 30% year-over-year in FY26, while the expected loss rate has improved by more than 50%."

[2] Drillr · Bill.com Holdings, Inc. (BILL) · revenue trend verification

[3] Drillr · Bill.com Holdings, Inc. (BILL) · headcount and efficiency verification