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Newtek Bank is funding business loans of up to $350,000 in a week, explicitly targeting MCA borrowers, undercutting SBA Express timelines, and doing so without adding headcount. There's a small business owner somewhere right now who needs $200,000 to make payroll, buy inventory, or bridge a gap before a big contract pays out. Her options, until recently, have been: wait two months for a bank loan, take an SBA Express loan that promises speed but still takes 25 to 60 days in practice, or sign a merchant cash advance and accept rates that can run into triple digits on an annualized basis. Newtek Bank just announced a fourth option, and it's gunning directly at all three. On March 10, NewtekOne, Inc. ( NASDAQ: NEWT ) announced the Newtek Seven Day Business Loan™ : term loans up to $350,000, funded within seven calendar days of a complete application, structured over ten years with no balloon payment. The company didn't hedge its ambitions. CEO Barry Sloane said plainly that creditworthy borrowers can now avoid 'less attractive options such as MCAs or daily debit financing, which typically carry extremely high rates of interest and short repayment schedules.' (Note there is no interest on MCAs since they are not a loan) Seven Days. Ten Years. No Balloon. The product design is deliberate. The $350,000 ceiling isn't arbitrary; it's the size range that defines SBA Express (max $500K after 10/1/21) and other bank loans, and historically the segment that has fallen through the cracks: too large for a microloan, too small for banks to prioritize with their standard underwriting apparatus. The ten-year repayment term and absence of a balloon payment address a structural problem that MCA (revenue based financing) and short-term products create. A merchant cash advance of $150,000 will require daily or weekly debits for 3 to 18 months, and if not careful, can strain cash flow. Newtek's product spreads the same obligation over a decade at what the company describes as materially lower total cost. "Creditworthy borrowers can avoid less attractive options such as MCAs or daily debit financing, which typically carry extremely high rates of interest and short repayment schedules."— Barry Sloane, CEO, NewtekOne, March 10, 2026 The SBA Express Reality Check SBA Express loans have a reputation for speed that their actual funding timeline doesn't always support. The SBA does respond to Express applications within 36 hours; that part is real. But the SBA's response is just a loan number. What follows is still lender underwriting, document collection, collateral review, closing, and disbursement. Most sources put the realistic window at 25 to 60 days from complete application to funded. LendingTree puts the range at 25 to 60 days. Nav says to expect up to two months, though efficient lenders can close in 30. SoFi's published guidance gives a floor of five days but notes it can stretch to 60 depending on the lender. How AI Gets It to Seven Days - and What It Costs in Jobs The speed comes from Newtek's internally built NewTracker® system, which deploys AI across the entire origination stack. The system analyzes historical financials, projects future cash flows, takes liens on assets, reviews corporate documents, and assembles the credit package for the bank's human credit committee. The final decision is still made by Newtek's professionals, AI handles the data gathering, integration, and presentation; people make the call. But Sloane was candid about what this means for staffing. He noted that AI-powered processes have tripled the number of loans closed over the last three years, without adding headcount. That's not a footnote. That's the business model. You scale loan volume by deploying AI, not by hiring loan officers, processors, and closers. The technology doesn't just compress time-to-funding. It permanently restructures the economics of origination. And as noted by Mr. Sloane, shareholders benefit from improved profitability. "Incorporating AI into the underwriting process partially explains why we have tripled the number of loans closed over the last three years without adding headcount to loan closing staff."- Barry Sloane, CEO, NewtekOne AI Is Restructuring the Lending Workforce Newtek isn't alone in this dynamic. The fintech industry is moving through a broad AI-driven labor contraction that's accelerating in 2026. Block, Inc., parent of Square and Cash App, announced recently that it was cutting approximately 4,000 employees, roughly 40% of its entire workforce, with CEO Jack Dorsey explicitly citing AI productivity gains as a central driver. Block's AI coding tool, dubbed Block Goose, was already handling an estimated 40% of code written across the company before the cuts were announced. The stock rose more than 20% on the news. The pattern is consistent across the sector: AI investment increases throughput, throughput increases per-employee output, and that math eventually produces a smaller headcount at the same or higher volume. For banks and lenders, the implication is structural. The loan origination workforce that has traditionally been a fixed cost, processors, underwriters, analysts, and closers, is becoming a variable one, with AI absorbing the tasks that required human volume. For independent business owners and MCA borrowers, the near-term effect is positive: faster funding, lower fees, better products. For the origination labor market, it's a different story. What This Means for MCA Funders and ISOs Newtek's announcement is a direct acknowledgment that the MCA industry has captured a customer segment that banks have failed to serve. The press release names MCA by product category, not as competitive shade, but as the specific alternative its borrowers have been forced to use. That's a notable concession from a bank. The relevant question for funders and ISOs is which portion of their book is creditworthy enough to qualify for Newtek's product. MCA serves a broad spectrum, from strong businesses with temporary timing needs to distressed borrowers that traditional credit would never touch. The Seven Day Business Loan doesn't compete for the latter. It competes for the former: businesses with clean books, real collateral, and a cash flow story that underwrites, businesses that have historically ended up in MCA simply because the bank was too slow. That's a genuine threat to the high-quality end of MCA deal flow. And if Newtek's AI-driven model continues to scale, loan volume tripling over three years is a meaningful data point, it puts pressure on every other bank, SBA preferred lender, and online lender to ask why their own sub-$350,000 underwriting still takes a month. Newtek Just Moved the Benchmark Newtek has been the top dollar-volume SBA 7(a) lender in the country. They know how to originate at scale. The Seven Day Business Loan is what happens when that institutional knowledge gets rebuilt from the ground up around AI underwriting, not bolted on top of a legacy process, but integrated into how the credit decision gets made. Whether the product performs as advertised will be the story to watch over the next 12 months. But the announcement alone reframes what 'fast' should mean for sub-$350,000 business loans, and what it will cost in labor to get there.

If you’ve been following the flow lately, you know the narrative: AI is going to replace the underwriter, speed up collecting "stips," and fund deals before the merchant even finishes their coffee. But while the fintech world is busy celebrating 30-second approvals, Goldman Sachs just dropped a massive reality check. In a recent Reuters report , Goldman executives warned that AI disruption is going to "challenge" lending decisions in the coming years. For those of us in the alternative lending space, that isn't just a headline: it’s a warning shot about the durability of our capital. The "New" Risk: Why Speed Might Be Killing Your Portfolio In the Revenue-Based Financing/MCA world, most pride themselves on being faster than the banks. But there’s a massive difference between efficiency  and intelligence . The 'Ghost' Merchant:  As AI tools become more common for small business owners, it’s becoming easier to "game" the algorithm. From AI-generated revenue projections to synthetic bank activity, the "data" we’re feeding into our models is getting noisier. If your AI isn't built to spot other  AI, you're funding ghosts. Model Drift is Real:  Most AI models are "historical". They look at what happened yesterday to predict tomorrow. But Goldman is pointing out that we are entering a period of "unprecedented disruption." If a merchant’s entire industry is being upended by AI (think coding agencies, copy shops, or basic data entry), their 2024 tax returns mean zero  for their 2026 survival. The Compliance Trap:  We’re already seeing the CFPB and state regulators sniff around "algorithmic bias." If your "Black Box" declines a file and you can’t give the ISO a straight answer as to why , you’re not just losing a deal; you’re inviting a lawsuit. The Funder Intel 'Pro' Strategy It’s not all doom and gloom. If you’re a funder or a high-volume ISO, the right AI stack is still your greatest weapon if you use it as a filter, not a replacement. Deep-Tier Discovery:  The real money in 2026 isn't in the 'A-Paper' files everyone is fighting over. It’s in using AI to find the "diamonds in the rough": merchants with lower credit scores but hyper-resilient digital footprints (strong social sentiment, high recurring payment stickiness, and low refund rates). The 'Anti-Fraud' Shield:  The best tech right now isn't underwriting the deal; it’s protecting the house. We’re seeing funders use AI to run real-time "behavioral biometrics" on how a merchant interacts with a funding portal. If the behavior looks "robotic," the file gets flagged instantly. Don't Let the Tech Outrun the Logic At the end of the day, we are in the risk business. Goldman is telling the world what we’ve always said at Funder Intel: You cannot automate common sense. The winners in this next cycle will be the 'hybrid shops': the ones using high-speed AI to clear the junk, but keeping a seasoned human eye on the trigger for the big-ticket funding. Don't let a slick interface blind you to a bad deal.

National Funding has reported record originations for 2025, surpassing the $2.5 billion mark in total small business financing. The milestone is an important data point for the alternative lending sector, signaling that despite, or perhaps because of, a high-interest-rate environment and tightened bank credit, the appetite for non-bank capital has never been higher. The San Diego-based lender attributed the surge to a "perfect storm" of economic variables: persistent inflation, more aggressive bank de-risking, and a structural shift in how SMBs value speed over the cost of capital. For operators across the ecosystem, National Funding’s performance validates a core thesis: the "gap" in small business funding is no longer a niche, it’s the market. The Velocity Premium: Why SMBs are Bypassing Banks While traditional institutions still hold the lion’s share of deposits, their underwriting "moats", timelines, documentation, and rigid risk appetites continue to alienate the modern operator. National Funding’s growth suggests that a "Velocity Premium" now exists. SMBs are increasingly willing to pay for capital that arrives in days rather than months. According to the company, this growth isn't siloed; it spans a broad vertical range, from construction to retail, where businesses are using capital not just for survival, but to capture market share while competitors are sidelined by credit freezes. Data-Driven Underwriting as a Competitive Moat The $2.5 billion figure is as much a tech story as it is a finance story. The sector’s scaling is being driven by the "Agentic" shift in underwriting, leveraging real-time bank transaction data and automated risk modeling to replace the antiquated paper trail. For funders and fintech leaders, this trend represents a permanent shift in the competitive landscape. National Funding noted that its investment in proprietary tech has been the primary lever for streamlining the funnel for both brokers and direct applicants. In 2026, the "winners" are those who can maintain risk discipline while removing the friction that defines traditional banking. National Fundings Broker Network Despite the rise of direct-to-consumer digital channels, National Funding’s record year reinforces a fundamental industry truth: The ISO and broker network is the lifeblood of distribution. As competition for high-quality paper intensifies, the relationship between funders and ISOs has become more sophisticated. Strategic partnerships are no longer just about commission structures; they are about integration and reliability. For National Funding, the ability to scale originations was inextricably linked to its ability to serve the broker channel with consistent, predictable outcomes.

On March 4, 2026, the U.S. Small Business Administration initiated termination proceedings against 628 companies participating in the federal government’s 8(a) Business Development Program. The move began as a compliance demand. Participating firms were asked to provide three years of financial records to verify program eligibility and investigate potential misuse of the 8(a) contracting system. Hundreds of firms declined. The SBA’s response was swift. Firms that refused to produce documentation are now facing removal from the program and termination of their eligibility for federal set-aside contracts. This follows the January suspension of over 1,000 firms that failed to meet a 2025 "Data Call" for three years of financial records. This isn't just a compliance hiccup. It's a systematic removal of nearly 20% of the program's participants. The Myth of the "Secure" Government Receivable We’ve all seen the files: a merchant with a multi-year federal contract, sole-source awards, and a 5.0 rating on SAM.gov. On paper, it’s a gold mine. But in 2026, we’re seeing that the government doesn't just provide the revenue; it also provides the permission to earn it. When that permission, the 8(a) certification, is revoked, the "secure" receivable evaporates: Pipeline Paralysis:  Existing contracts may continue for a period, but the ability to bid on set-asides or receive new sole-source awards ends the moment the Notice of Termination hits. The "Pass-Through" Exposure:  The SBA isn’t just looking for missing paperwork; they’re looking for shell companies. If your merchant was acting as a "pass-through" for a larger entity, their actual margins are likely razor-thin, and their ability to pivot to the private sector is zero. Underwriting the "Regulatory Privilege" The 8(a) program is a regulatory privilege, not a permanent business asset. The current enforcement under Administrator Kelly Loeffler signals a pivot toward aggressive transparency. The fact that 628 firms, responsible for nearly $850 million in recent contract awards, flatly refused to provide financial records should be a massive red flag for any underwriter. If a borrower won't show the feds their books to save their primary revenue stream, what exactly were they showing you on their funding application? The Shift in SBA 8(a) Enforcement Strategy We are entering a period in which "Small Disadvantaged Business" goals have been reduced from 15% to the statutory 5% .  With fewer set-aside dollars available and more aggressive auditing from the SBA, the Department of War (DOW), and the Treasury, the "safe" government contractor is a shrinking breed. Strategic Adjustments for Lenders & ISOs If you have exposure to this sector, the standard bank statement spread isn't enough anymore. You need to be asking: Is the 8(a) status current and "Audit-Verified"?  Don't just check the SAM.gov profile; ask for their SBA compliance response letter. What is the Concentration Risk?  If 8(a) set-asides represent more than 40% of their total revenue, you aren't funding a business; you're funding a certification. Does the "Social Proof" Match the Financials?  If the business claims 8(a) status but shows high-volume "subcontractor" payments to large entities, you’re likely looking at a pass-through that won't survive the 2026 audit cycle. The Bottom Line:  In alternative finance, we pride ourselves on looking at the real  cash flow, not just a credit score. But when a borrower’s revenue depends on a regulatory stamp, the biggest risk isn't the market. It's the auditor.

The 2026 Funders Forum & Brokers Expo (FFBE) delivered a high-stakes pulse check for an industry navigating a complex intersection of regulatory scrutiny and technological evolution. Hosted at the Seminole Hard Rock Hotel & Casino, the event brought together the heavy hitters of alternative finance: funders, lenders, ISOs, legal powerhouses, and fintech innovators, for a candid look at the road ahead. The tone was set by this year’s emcee, our very own Shane Mahabir, President of Funder Intel, whose ability to bridge the gap between panels kept the room engaged through a jam-packed agenda. The Psychology of the Deal: Daniel David The forum kicked off with a shift in perspective. Daniel David, D.C.’s premier mentalist, performed a set that was less about "magic" and more about the mechanics of human behavior. For a room full of underwriters and seasoned funders, David’s demonstrations of intuition and perception hit home. In an industry where risk assessment often boils down to reading between the lines of a bank statement or gauging a merchant's intent, David’s masterclass in "reading the room" served as a powerful reminder: data is vital, but human psychology still drives the deal. The Legal 'War Room' The heavy lifting occurred during the legal panels, where the industry’s top attorneys dissected the "Three Pillars" of a valid Revenue-Based Finance (RBF) agreement. To avoid judicial recharacterization (courts labeling an MCA as a "disguised loan"), the consensus was that contracts must strictly adhere to: Non-Recourse Structure:  The funder must  assume the risk of the business failing. Indefinite Terms:  Any hint of a fixed maturity date is now considered a "litigation magnet." The Reconciliation Reality:  Panelists warned that reconciliation clauses must be functional and non-illusory . If a funder doesn't actually adjust payments when a merchant’s revenue drops, the "True Sale" defense evaporates in court. Experts also touched on the CFPB’s 1071 data collection rule and the shifting political landscape, noting that while federal scrutiny is rising, market size continues to grow by billions annually, proving its resilience. Ecosystem Insights Beyond the legalities, the sessions dove into the operational 'meat' of the business. Key themes included: Underwriting 2.0:  A major focus on Stacking detection, with new data-sharing protocols aimed at stopping 'double-dipping' in real-time. The Liquidity Question:  Strategies for scaling credit facilities when the cost of capital remains volatile. The diversity of the panels featuring leaders from Everest Business Funding, Expansion Capital Group, Dragin, Hudson Cook, the ILPA, and Vox Funding offered a 360-degree view of the ecosystem. The Marino Moment: Leadership Under Pressure The closing keynote featured NFL legend Dan Marino. In a conversational Q&A, Marino opened up about the grit required to stay at the top of a competitive field for decades. For the entrepreneurs in the room, Marino’s reflections on resilience and regret were particularly poignant. He spoke about the "near misses" and the importance of discipline when the play clock is running down, a perfect metaphor for a funder trying to close a complex deal with a broker before the funding cutoff. His message was clear: Success is about the next play, not the last mistake. The Verdict on Funders Forum & Brokers Expo 2026 The Funders Forum & Brokers Expo confirmed that the alternative finance industry is maturing. The "Wild West" days are being replaced by a sophisticated, data-driven, and legally-conscious community that isn't afraid to push back against adversity. The term MCA is being extinguished in favor of revenue based financing. At the evening reception, the sentiment was unanimous: the market is changing, but for those who are adaptable, the opportunity has never been greater.

After six years, a $550 million fraud, nine federal convictions, and a courtroom brawl, the company that put a mob-connected con man in charge of a merchant cash advance empire has entered its final guilty plea. Here's what it all means. On March 9, 2026, in a Philadelphia federal courtroom, a court-appointed receiver walked in on behalf of a company that no longer really exists and entered a guilty plea that had been years in the making. Complete Business Solutions Group, Inc., better known in the alternative lending world as Par Funding, admitted to conspiracy to commit wire fraud and securities fraud. The corporate plea is the final formal act in one of the most damaging and revealing scandals the merchant cash advance industry has ever produced. It's worth saying out loud: this case is over. Every principal is convicted. Every co-conspirator has pleaded or been sentenced. The company itself has now pled guilty. And more than 1,600 investors who were told they'd likely never see their money, are on track to recover nearly all of it. But before we close the file on Par Funding, the industry deserves a clear-eyed look at what actually happened, what it cost, and what it still means for everyone operating in this space. How $550 Million Disappeared Into a Lie Par Funding was founded in Philadelphia in 2011 by Joseph LaForte, a man who had just been released from federal prison for a previous fraud conviction and whose real name and criminal history were concealed from every investor who ever put money into the company. That concealment was not an oversight. It was the foundation of the entire scheme. The business model on paper was legitimate: Par provided merchant cash advances to small businesses that couldn't access traditional bank financing. MCAs are a real product with real demand. Par had real customers. In the early years, the returns were real too — investors were earning 10% annually or more, and word spread. Between 2011 and 2020, Par raised more than $550 million from over 1,700 investors, primarily through a network of outside salespeople and investment managers who collected commissions for funneling client money into Par's notes. The problem was what was happening beneath the surface. LaForte and his co-conspirators were misrepresenting virtually everything material to investors: the company's underwriting standards and portfolio performance, default rates, profitability, insurance coverage, and the identities and backgrounds of company leadership. Par's revenues weren't just insufficient to generate the promised returns, they weren't even close. The business needed a continuous influx of new investor money to pay older investors, a structure that is, by definition, a Ponzi scheme. Meanwhile, LaForte and company insiders were diverting hundreds of millions for personal enrichment. The assets seized when the scheme collapsed included a private jet, multiple luxury properties, vehicles, artwork, and jewelry. More than $200 million had been siphoned out of an enterprise that was supposed to be serving small business owners. Then there was the violence. This wasn't just financial fraud. James LaForte, Joe's brother, a purported member of the Gambino crime family who had been formally inducted in October 2019, served as the company's collections enforcer. His methods included threats, physical assault, and in 2023, the ambush beating of the court-appointed receiver's lawyer, Gaetan Alfano, on a Center City Philadelphia street. The attack happened after the receivership had already been established. The LaFortes were trying to intimidate the legal process itself. The Sentences: Every Person Who Touched This Case Went to Prison The criminal accountability in this case is, by any measure, thorough. Here is where everyone landed: Joseph LaForte , founder and functional CEO: 15 and a half years in federal prison. Ordered to pay $314 million in restitution and forfeit approximately $20 million in assets including his private jet. Pleaded guilty to racketeering conspiracy, securities fraud, tax fraud, wire fraud, firearms violations, and obstruction of justice, including the street ambush of the receiver's attorney. James LaForte , enforcer and Gambino family member : 11 and a half years in federal prison. Ordered to pay $2.5 million in restitution. Pleaded guilty to racketeering conspiracy, extortion, wire fraud, obstruction, and threats against witnesses. Joseph Cole Barleta , CFO: 5 and a half years in federal prison for racketeering conspiracy. Lisa McElhone , Joseph LaForte's wife: Pleaded guilty to helping conceal more than $40 million in earnings. Sentenced as part of the broader case. Perry Abbonizio , investment manager who presented himself to investors as a co-owner: Six months in prison. Ordered to pay restitution. Renato 'Gino' Gioe , Gambino associate and debt collector: 18 months in federal prison, $949,000 in restitution. Rodney Ermel and Kenneth Bacon , tax professionals who prepared Par's fraudulent returns: Both pleaded guilty to felony offenses and received prison sentences. The March 9, 2026 guilty plea from Par Funding as a corporate entity is the formal capstone to all of it. The receiver, who has been managing the wind-down since July 2020, entered the plea on the company's behalf, completing the criminal record against the enterprise itself. The Investor Story: Against All Odds, Nearly Whole The most remarkable subplot of the entire Par Funding saga is what happened to the investors. When the SEC placed Par in receivership in July 2020, the conventional wisdom, reinforced repeatedly by the commission's own statements, was that full recovery was highly unlikely. Investors were bracing for pennies on the dollar. That is not what happened. Through a combination of asset seizures, civil settlements, insurance recoveries, and negotiations with the outside salespeople and legal professionals who facilitated Par's fundraising, the receivership has assembled a recovery that is, by any standard, extraordinary for a fraud of this scale. Assets seized from the LaFortes and co-conspirators included $133 million in cash and $43 million in properties, vehicles, artwork, and jewelry. Additional settlements, including with insurers for a lawyer who played a central role in fundraising, and with a family group of early financiers, have added close to $100 million more. As of November 2025, the Philadelphia Inquirer reported that more than 1,600 victims are on track to recover nearly all of their money. In January and March of last year, investors collected checks totaling $110 million, about 44 cents for every dollar lost. With the additional settlements now flowing, recovery is expected to exceed 80 cents on the dollar, with the final distribution anticipated to approach full restitution. Joe Brock, a management consultant who put $200,000 into Par, told the Inquirer: 'Sounds like Christmas to me.' "More than 1,600 victims of the Par Funding scheme will get nearly all their money back, despite repeated warnings from the U.S. Securities and Exchange Commission that full reimbursement would be highly unlikely."— Philadelphia Inquirer, November 2025 The Par Funding File Is Closed. The Lesson Isn't. With the March 9, 2026 guilty plea from Complete Business Solutions Group, the Par Funding case is now complete in every legal sense. Joseph LaForte will spend the next fifteen years in federal prison. His brother will serve nearly twelve. The CFO is incarcerated. The mob-connected enforcer is incarcerated. The wife, the salespeople, the accountants, all convicted, all sentenced. The company that employed them, funded through a structure that was rotten at its foundation, has now formally admitted in open court what everyone already knew: it was a fraud from the beginning. For the MCA/Revenue Based Financing industry, the closure of this case is both a relief and a responsibility. The relief is obvious, a shadow that hung over the sector for six years is lifting. The responsibility is harder. Par Funding didn't happen in a vacuum. It happened inside an industry, surrounded by people who didn't ask hard enough questions for long enough. That's the part that doesn't get closed with a guilty plea.

Revenue growth in the alternative lending sector often tells only half the story. Canadian merchant cash advance provider Advantex Marketing International reported strong top-line momentum in its latest quarterly results, driven primarily by growth in its MCA financing business and its Aeroplan loyalty partnership. But despite the revenue gains, the company also posted a wider net loss. This highlights the ongoing balance between expansion and credit risk that defines much of the alternative funding market. For lenders watching the sector, the results are a familiar narrative. Demand for small business capital remains strong, but scaling that demand profitably remains the industry’s central challenge. Advantex MCA Growth Drives the Top Line Advantex reported Q2 revenue of roughly $1.28 million, representing a year over year increase of more than 40%. The growth was fueled by expansion in both its merchant cash advance (revenue-based financing) program and its Aeroplan loyalty partnership with Air Canada. Revenue from the Aeroplan segment alone climbed more than 50%, while MCA-related revenue increased nearly 37%. The model is unusual but increasingly common in alternative finance. Advantex combines working capital advances for merchants with a loyalty program that allows businesses to offer Aeroplan points to customers. This creates an incentive loop that drives both merchant adoption and consumer engagement. In theory, the structure allows the company to monetize both financing and marketing relationships simultaneously. Losses Widen Despite Growth The top-line momentum did not translate into improved profitability. Advantex reported a net loss of roughly $0.84 million, widening from about $0.60 million in the same quarter last year. The company attributed the deterioration primarily to higher bad debt provisions and increased non-cash interest expenses tied to its debenture financing and transaction credit growth. In other words, the company is spending more capital to originate funding while simultaneously setting aside larger reserves to protect against borrower defaults. That dynamic is not unique to Advantex. Across the alternative lending ecosystem, funders are navigating a similar balancing act as higher interest rates and economic uncertainty place pressure on small business borrowers. Capital Expansion Signals Continued Demand Despite the widening losses, the company continues to position itself for expansion. Advantex recently secured a $20 million funding relationship designed to support additional small business financing originations and extended the maturity of key debentures to 2027. The company also reported that its portfolio of transaction credits grew to more than $9 million, reflecting continued demand for merchant financing. For alternative lenders, access to capital lines like these is often the difference between incremental growth and real scale. Funding capacity remains one of the primary constraints on MCA expansion across the industry. The Loyalty Finance Model Advantex’s partnership with Aeroplan remains one of the more distinctive structures in the alternative funding space. By linking merchant financing with airline loyalty points, the company attempts to create a dual value proposition: working capital for businesses and rewards incentives for customers. The strategy has shown steady traction in recent quarters. Earlier financial filings also showed strong revenue growth driven by the Aeroplan program and continued uptake of MCA financing among small merchants. The model reflects a broader trend in fintech where financial products are increasingly embedded into customer engagement ecosystems. The Bigger Picture Advantex’s results capture the current state of alternative small business lending in a single snapshot. Demand for capital remains strong. Revenue growth across MCA platforms continues to accelerate as traditional banks maintain tighter underwriting standards. But the cost of that growth is rising. Higher borrowing costs, economic volatility, and credit risk management are forcing lenders to increase reserves and carefully monitor portfolio performance.

In this week's podcast, we catch up on the new SBA policies that are preventing non-citizens from obtaining SBA 7 (a) and 504 loans, with Chris Tomlinson from Optimum Bank . Learn how the new SOPs will affect access to financing for many across the country and how alternative funding companies may benefit. Optimum Bank Chris Tomlinson 954-900-2800 online@optimumbank.com

Nick De Jesus from Meridian Leads and Lendfax joined me on the podcast to discuss both companies, with Lendfax being the newest brand and marketing opportunity for any business seeking quality marketing and lead generation services in the commercial finance space. Contact: Nick De Jesus nick@meridianleads.com Lendfax Meridian Leads For more Video interviews , visit our Videos page

YouLend just secured $225 million to lend money to small businesses, but the remarkable thing isn't the size. It's the mechanism. The loan never comes from a bank. The merchant never fills out a form. The money arrives through the software they were already using. Picture a small business owner in Atlanta, let's call her Maria. She runs a clothing brand on Shopify. Business is good; she wants to buy inventory ahead of the summer season but needs $40,000 in working capital. She goes to her bank. The bank asks for two years of tax returns, a personal guarantee, three months of bank statements, and tells her she'll hear back in four to six weeks. She doesn't have four to six weeks. The inventory needs to be ordered now. Maria logs back into Shopify. There's a banner she's never paid attention to. It says she's been pre-approved for $47,500 based on her sales history. She clicks it, confirms the amount, and the money hits her bank account the same day. Repayment comes automatically, a small percentage of each sale, so she never has to think about it again. She doesn't know it, but the company that actually underwrote that loan wasn't Shopify. It was YouLend . And the capital YouLend just used to fund her came, in part, from a $225 million forward-flow facility it announced this week with Värde Partners, a global alternative investment firm. That's not just a fintech deal. That's the story of how small business lending works now. What YouLend Actually Does Founded in 2016 in London, YouLend is what the industry calls an embedded financing platform, and to be more specific, embedded lending. It doesn't have branches. It doesn't advertise to small businesses directly. Its entire distribution strategy is to disappear inside the software that small businesses already use, e-commerce platforms, payment processors, accounting tools, and surface capital offers at precisely the moment a merchant needs money. The company's technology integrates via API with host platforms. The platform shares transaction data. YouLend's model assesses creditworthiness not through traditional credit scores but through actual business performance, revenue trends, transaction frequency, platform tenure, return rates. The result is a 90% approval rate and funding in as little as 24 to 48 hours, compared to the four-to-six-week wait that Maria's bank quoted her. The product is revenue-based financing: merchants repay as a percentage of daily sales, which means repayment flexes with the business. A slow week means smaller payments. A strong week means faster payoff. There's no fixed monthly bill, no penalty for early repayment, no collateral requirement. For a small business whose revenue is seasonal or unpredictable, this structure is genuinely different from anything a traditional lender offers. To date, YouLend has provided funding to more than 370,000 businesses globally. Its partners include Shopify, eBay, Amazon, and Dojo. That number, 370,000 businesses, is worth sitting with for a moment. That's 370,000 instances of capital reaching a business that, in many cases, would have been turned away by a traditional lender. The Värde Deal: What $225 Million in Receivables Actually Means The structure of this transaction deserves more attention than the headline number. This is not a fundraise. YouLend isn't selling equity. What Värde Partners has agreed to do is purchase up to $225 million in receivables, the future repayment streams from loans YouLend has already originated or will originate. It's a forward-flow agreement, which means Värde commits in advance to buying those receivables as they're created, giving YouLend a predictable, scalable pool of capital to deploy. For YouLend, this is elegant. It gets committed U.S. capital without tying up its own balance sheet. As it originates new loans, Värde purchases them. The risk of those loans sits on Värde's books. YouLend earns fees for origination, servicing, and platform management. It can grow its lending volume without needing to raise equity rounds every time it wants to expand. For Värde, this is asset-backed private credit, a category that institutional investors have been racing toward as traditional fixed income yields have compressed. The receivables are backed by real small business repayments, diversified across hundreds or thousands of merchants. The default risk is pooled, underwritten by YouLend's platform data, and structured to give Värde predictable cash flows. "Värde's deep experience in U.S. asset-backed credit and specialty finance makes them a strong partner as we continue to invest in our U.S. capabilities and meet growing merchant demand in this core market."— Gaurav Maheshwari, Head of Capital Markets, YouLend This is not YouLend's first major capital markets move in the U.S. In October 2024, the company secured a separate $1 billion facility from Castlelake, another alternative investment firm, to fund U.S. SMB originations over a three-year window. The Värde deal layered on top of Castlelake signals something important: YouLend is deliberately diversifying its institutional capital base. Multiple forward-flow partners reduce concentration risk and give the business more flexibility to grow without being dependent on a single counterparty's appetite or credit terms. The Quiet War Between Banks and Platforms To understand why YouLend's model is working so well right now, you need to understand what happened to small business lending over the past decade, and what happened to it in 2025 specifically. Banks have always been poor at lending to small businesses. Not because they don't want to, but because the economics are brutal. Underwriting a $50,000 loan costs roughly the same in compliance, documentation, and credit analysis time as underwriting a $5 million loan. The margin on the small loan is a fraction. So banks naturally gravitated toward larger commercial clients, leaving a persistent gap in the market for businesses that needed $10,000 to $500,000 quickly. That gap has historically been filled by credit cards, personal loans, and predatory short-term lenders who charge rates that would make a loan shark blush. The embedded lending model doesn't just improve on those options; it replaces the entire paradigm. When the platform that processes your payments is also the one extending you credit based on those payments, the underwriting is fundamentally different. No forms. No human review process. No four-week wait. "Embedded banking lets accounting platforms and marketplaces own the full financial workflow, relegating banks to back-end infrastructure providers."— Riccardo Colnaghi, Industry Analyst — 2025 The data from 2025 shows this shift is now measurable at scale. Shopify's gross loans receivable reached $1.6 billion at year-end 2025, up 43% from $1.1 billion a year earlier. The company purchased $4.2 billion in merchant cash advances and loans during 2025, compared to $3 billion in 2024. Block reported that Square Loans were the primary driver of its Financial Solutions growth in Q4. PayPal's working capital products continue to expand. JPMorgan, meanwhile, reported muted growth in consumer lending margin, in part because fintech partners are cutting into origination fees that banks used to own. The moat that banks spent decades building, transaction data and customer relationships, has shifted. The platforms that process payments now own the data. And the companies that power those platforms' lending products, like YouLend, are the new infrastructure layer for small business credit in America. Why the U.S. Matters So Much YouLend is a London-born company that has operated primarily in the UK and the European Union. Its U.S. expansion is deliberate, well-resourced, and now better capitalized than ever, but it is still, in relative terms, in its early days. The U.S. SMB market is simply enormous. Small and medium-sized businesses account for between 43.5% and 50.7% of U.S. GDP. They represent 62.7% of all net new job creation historically. The National Small Business Association has consistently found that access to capital is one of the top constraints on small business growth, with roughly one in four small businesses reporting they were unable to get the financing they needed in the past year. That unmet demand is precisely the market YouLend is targeting. The Castlelake facility funded originations. The Värde facility adds $225 million more, structured to grow as YouLend's U.S. platform scales. The company recently expanded into a larger Atlanta headquarters to support its growing American team, a physical signal of the organizational investment behind the capital one. The embedded finance market in the U.S. is projected to exceed $7 trillion in transaction value by 2026, according to multiple industry reports. Embedded lending alone, the slice YouLend occupies, is forecast to reach $80 to $90 billion in outstanding balances. YouLend is not the only company chasing that number. But it has platform partnerships, institutional capital relationships, and a decade of proprietary lending data that make it one of the most credibly positioned players to capture a meaningful share of it. The Bigger Picture for Alternative Lenders For anyone operating in the alternative lending space, merchant cash advances AKA revenue-based financing, and business term loans, the YouLend story is both an opportunity signal and a competitive warning. The opportunity: embedded lending infrastructure is still early, and the distribution advantage it creates is enormous. A lender that integrates natively into a platform where merchants already spend hours every day has a customer acquisition cost that approaches zero. The merchant doesn't shop for a loan. The loan finds them. That is a structural advantage that standalone alternative lenders cannot easily replicate. The warning: the same structural advantage that benefits YouLend is also what allows Shopify, Square, and PayPal to build their own lending products in-house. As those giants grow their loan books, Shopify at $1.6 billion and climbing, the addressable market for independent embedded lenders gets both larger and more competitive simultaneously. What YouLend has done well is position itself as an infrastructure for the mid-tier and smaller platforms that can't build their own lending products internally. It's the lender you call when you're eBay, Etsy, or Dojo, large enough to want an embedded capital offering for your merchants, not large enough to build and fund it yourself. That middle market is deep, growing, and in need of exactly what YouLend offers.

Milestones in the alternative lending space usually come with a lot of PR fluff. But when a company crosses the $5 billion mark, it’s less about the headline and more about the gravity. This week, Fora Financial announced it has officially deployed over $5 billion in capital to more than 55,000 small businesses since its 2008 inception. To put that in perspective, the company just wrapped up a record-breaking 2025, posting a 17.1% year-over-year increase in total originations and growing its portfolio by 25.6%. For a sector once dismissed as "fringe," these aren't just growth numbers. They are proof of a fundamental shift in how Main Street survives. The Speed Premium Fora is leaning into the "speed premium" with approval decisions in as little as 4 hours, funding within 24 hours, and other enhancements. In the real world, a construction company doesn't need a "maybe" in 45 days; they need a "yes" before the summer paving season ends. Like many revenue-based funders, Fora’s model treats revenue data and transaction history as the primary signals, moving away from the "bureau-centric" scoring that keeps many entrepreneurs locked out. Expanding the Playbook Fora isn't just resting on its laurels. Heading into 2026, they are rolling out several technical upgrades: Enhanced Online Checkout:  Aimed at faster funding with fewer "stips" (stipulations). Underwriting Overhauls:  Using AI-driven signals to accelerate decisions. New Partner Platform:  A major play for the broker and ISO ecosystem, offering better visibility and customization for the intermediaries who actually drive these deals. Why the Tailwinds are Shifting The timing of this milestone is no accident. The broader alternative lending market is growing at an annual clip of over 13%. Ironically, government policy might be the biggest unintended catalyst. Recent SBA rule changes regarding ownership requirements are tightening the funnel for federal loans. When the SBA door closes, the nonbank door opens wider. For providers like Fora, which operates across 100+ industries and 49 states, this shift represents a massive expansion of their addressable market. The Bottom Line Fifteen years ago, "alternative finance" was an experiment. Today, it’s a multi-billion dollar pillar of the economy. Fora’s $5 billion signal tells us that the definition of a "business bank" is changing. It’s no longer about who has the biggest branch on the corner. It’s about who can deliver liquidity the moment an entrepreneur actually needs it.

PayPal’s recent disclosure of a security flaw in its Working Capital application serves as a sobering reminder: in the world of embedded lending, "velocity" is often the natural enemy of "validation." For nearly six months, from July 1 through December 13, 2025, a logic error allowed sensitive customer data to sit exposed. While the scope was limited to roughly 100 accounts, the implications for the merchant cash advance (MCA) and small business lending space are significant. Logic vs. Perimeter: The Internal Vulnerability This wasn't a sophisticated external hack; it was a logic failure. Traditional cybersecurity focuses on the "walls": phishing, malware, and brute-force attacks. However, business logic flaws live inside the code that governs how data is accessed. The Exposure Gap:  The six-month detection window suggests that while PayPal’s external defenses held, their internal monitoring wasn't calibrated for abnormal data visibility at the application layer. The Lesson for Lenders:  As platforms move deeper into automated underwriting, the "surface area" for risk grows. If your code isn't as robust as your credit model, you’re creating an asymmetric liability. In Lending, Identity is the Collateral A breach in a lending environment carries a different "risk math" than a standard payments leak. "Passwords can be reset, Social Security numbers and dates of birth cannot." For alternative lenders, data is the foundation of the credit facility. When application data is compromised, it triggers a domino effect of regulatory scrutiny, consumer protection risk, and secondary reputational damage that can chill investor confidence in a platform’s operational resilience. This all came on the heels of recent news that PayPal was a target of a takeover or possible acquisition by Stripe , and its stock price has been in the tank over the last 4 years. It's now at $47 from a high of $310 in late 2021. Product Velocity vs. Risk Discipline PayPal Working Capital is a heavyweight in the SMB space, competing directly with bank-led small business loans. In 2025, they announced they surpassed $30B in Global Small Business Lending. As scaled platforms like PayPal expand their credit footprint, they inherit a new tier of expectations: Bank Partner Oversight:  Increased pressure from originating partners. Warehouse Expectations:  Heightened standards for data integrity from capital providers. Capital Markets Visibility:  Investors look for "operational excellence" as a prerequisite for funding. The structural question for the industry isn't whether PayPal can absorb this; they can. The question is whether the push for rapid product deployment in 2026 is outstripping the internal controls required to manage a credit book safely. PayPal breach signal to Funders In a tightening capital environment, cybersecurity is no longer just an IT line item; it is balance sheet protection. For the alternative funding community, operational discipline now directly influences the cost of funds. If a funder or platform cannot demonstrate a "security-first" release cycle, they risk being viewed as a liability by their warehouse lenders and syndication partners.