NMI Adds Embedded Lending Options
The embedded lending wave usually gets written up as a threat to the broker channel. NMI's latest move is more interesting than that: it hands the products to the channel.
NMI, the embedded payments infrastructure company processing close to $700 billion annually, announced Tuesday that it is expanding NMI Business Capital, its white-label merchant financing program, with two new products. Term loans target more established merchants that want larger amounts and predictable monthly repayments. Starter offers open a funding route for newer businesses, including merchants with limited credit history, with each merchant's available financing set through underwriting. That takes the program from a single-product offer to a ladder: an entry point for thin-file merchants on one end, structured larger-dollar credit on the other.
The distribution is the story. NMI says more than 6,000 technology partners use its infrastructure to serve over 1.2 million merchants, and Business Capital lets those partners, including ISOs, software companies and SaaS platforms, offer financing without building a lending program or taking on underwriting, servicing or compliance. NMI product manager Jaron Ruckman framed the expansion as serving merchants across growth stages while keeping the complexity away from partners, and Eric Aynbund of BAMS, a merchant services provider in the network, described it as a way to connect merchants with capital inside a platform they already use.
NMI also offered a retention stat worth reading carefully: nearly 90 percent of merchants who repaid their loan and remained eligible went on to take additional funding, per the company's own first-party data. That is a genuinely strong signal of repeat demand, and also a carefully carved cohort. It measures the merchants who finished paying and still qualified, not all borrowers. Keep both halves in mind.
The same pipes, again
Funder Intel readers have seen this stack before. Business Capital is powered by Parafin, with loans issued by Celtic Bank, which is the identical machinery behind SpotOn Capital's restaurant financing program we covered this month. Parafin's model is to sit invisibly behind consumer-facing and merchant-facing brands, doing the underwriting, capital and servicing while the platform keeps the relationship.
It's also why the capital side of this year's news makes sense. Parafin has spent 2026 stacking warehouse capacity and forward-flow arrangements from some of the biggest names in credit, part of the broader surge of institutional money flowing into embedded and revenue-linked small business lending that our Deal Tape has been tracking. Facilities like those exist to be deployed, and a distribution network of 6,000 platform partners is exactly the kind of pipe that deploys them.
Zoom out and the pattern is consistent: payments companies keep converging on lending because they sit on the two things underwriters want most, real-time revenue data and the repayment rail. Every processor, gateway and vertical SaaS platform with merchant flow is either building this, buying it, or renting it from someone like Parafin. NMI renting it and then sub-letting it to thousands of partners is the logical end state of that trend.
What it means for the ISO channel
Most embedded lending launches route around the broker: the platform makes the offer, the merchant clicks, and no ISO or broker ever touches the deal. NMI's version explicitly includes ISOs as distribution partners. An ISO reselling NMI's payments stack can now put term loans and starter financing in front of its merchant base without building anything, which turns embedded lending from a competitor into a product line for at least this slice of the channel.
The flip side deserves saying plainly. Financing offered inside the processing relationship is sticky in both directions. That near-90 percent repeat figure, whatever its caveats, describes merchants who keep coming back to the platform for capital, and a merchant with an active loan through their gateway is a merchant who is much less likely to switch processors, or to pick up the phone when an outside broker calls. Every merchant funded through an embedded program is a merchant the traditional origination channel didn't fund.
The merchants are getting funded either way. The open question for this industry is who's standing next to them when it happens, and NMI just made its answer: the platform, and any ISO willing to work through it.
