Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: P2P, Lending, Digital Bonds, BNPL, Private Credit
KOHO Selects LoanPro to Expand Credit Products
October 16, 2026 | Market Activity | Digital Banking, Lending Infrastructure, Embedded Finance
KOHO Keeps Control of Product Design While Outsourcing Credit Servicing
On October 14, 2026, Canadian fintech KOHO selected LoanPro's lending platform to support its next financial products across Canada. LoanPro will provide billing, servicing and reporting, while KOHO retains control of its mobile app and product design. The arrangement gives KOHO specialized credit infrastructure as it expands beyond everyday spending and savings into a broader range of financial products.
Founded in 2014, KOHO has served more than 2.5 million Canadians, according to the announcement. Its current services include credit building, instalment payments, cash advances and a revolving line of credit. Supporting these products requires more than a customer interface. KOHO needs systems that can manage repayment terms, account balances and servicing requirements as its credit offering grows.
LoanPro Gives KOHO More Control Over Credit Product Design
KOHO Chief Product Officer Rusen Baragiola wants technology that can accommodate new financial products without limiting how the company designs them. LoanPro's platform provides configurable billing, account servicing and reporting, allowing KOHO to develop products within its own app while relying on specialist software to manage the underlying credit accounts.
"We chose LoanPro for the flexibility to bring new products to market quickly and responsibly."
KOHO already offers different repayment arrangements. Its Pay Later service allows eligible customers to divide purchases of up to $1,000 into payments over three, six or nine months. Its revolving line of credit allows borrowers to access funds as needed while paying interest only on the amount used. Each product requires its own billing rules, payment records and account management processes.
See: Slate Raises $1.3M for Embedded Lending in Canada
The LoanPro agreement also addresses a Canadian operating requirement. Credit products must accommodate applicable provincial rules, including those in Québec. LoanPro's configurable platform gives KOHO flexibility to adapt product terms and servicing processes across jurisdictions while maintaining a consistent experience in its app. For a company serving customers nationally, it's important as it introduces products with different repayment structures and eligibility requirements.
KOHO's $15,000 Credit Line Already Uses Fora
KOHO's existing line of credit provides a useful example of how the company works with lending partners. Eligible customers can access between $1,000 and $15,000 through Fora Credit, which handles underwriting, approval, funding and servicing. KOHO provides the customer relationship and digital access to the product.
How KOHO's lending responsibilities are currently divided:
| Company | Confirmed role | Product or arrangement |
|---|---|---|
| KOHO | Customer app, customer relationships and financial product design | Existing financial services and planned LoanPro supported offerings |
| LoanPro | Billing, credit servicing technology and reporting | New KOHO financial products under the October 2026 agreement |
| Fora Credit | Underwriting, credit approval, loan funding and servicing | Existing KOHO Line of Credit, offering $1,000 to $15,000 |
Sources: KOHO's published line of credit documentation and the October 14, 2026 LoanPro partnership announcement. The LoanPro agreement covers new offerings; it does not establish a change to Fora's existing responsibilities.
Fora is part of Toronto fintech lender Propel Holdings, which also operates the Freshline lending platform backed by a US$60 million financing agreement. KOHO already works with Fora to provide its line of credit, while LoanPro brings additional billing, servicing and reporting technology to support KOHO's next credit products. The two relationships serve different purposes within KOHO's lending business.
See: OnePay Adds Personal Loans Through Upgrade
KOHO has served more than 2.5 million Canadians since 2014, giving it an established audience for new credit products. By keeping control of product design and the customer experience, KOHO can introduce different repayment options while relying on specialist partners for lending technology and operations.
Talking Point
KOHO's lending strategy raises a question about who controls the economics of consumer credit. A fintech may own the customer relationship, but its ability to set credit terms, approve borrowers and earn lending revenue depends on how responsibilities are divided with its partners. As KOHO expands, those arrangements could matter more to its competitive position than the technology powering the loans.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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PaySprint Plans PYMO Wallet With Overdraft Protection
October 13, 2026 | Market Activity, Payments And Money Movement, Digital Banking, Consumer Credit
Toronto Fintech Launches a Consumer Brand With Wallet Payments and Planned Overdraft Protection
On September 29, 2026, Toronto fintech PaySprint Inc. announced plans to launch PYMO, its new consumer digital wallet brand, in October. The company plans to combine existing payment services with overdraft protection for eligible users, using wallet transaction history to help assess credit eligibility. In an email to NCFA, PaySprint confirmed that PYMO builds on its existing wallet services and PaySprint Flex offering.
PaySprint sees an opportunity among newcomers, freelancers, gig workers and people with irregular income. The company wants to make its wallet part of their everyday finances, with an additional credit option for eligible customers. Applications for overdraft protection haven't opened yet.
Why PaySprint Is Launching a Separate Consumer Brand
PaySprint already serves consumers and businesses through its payment infrastructure, including earlier wallet and overdraft offerings. Olusegun Shalom Adebiyi, CEO of PaySprint Inc., told NCFA that PYMO gives the consumer business a clearer identity without replacing PaySprint or changing existing customer agreements. The strategy is to increase wallet usage, strengthen customer retention and generate more revenue from existing payment relationships.
PaySprint reports more than 13,300 registered users and 2,000 merchant partners, giving PYMO an existing customer base and merchant network to build on. The company now has an opportunity to convert those relationships into more frequent transactions and greater use of its consumer services.
PYMO Plans Overdraft Eligibility Based on Payment History
PaySprint plans to use wallet transaction history as part of its overdraft eligibility assessment. Canadian customers will also need a PaySprint Mastercard on file to apply. The card handles everyday spending using available funds, while overdraft protection is planned as a separate wallet feature for approved users.
The PYMO credit page outlines planned overdraft limits of up to $500 for individuals and $5,000 for businesses. PaySprint says it will provide further eligibility details, borrowing costs and repayment terms prior to applications opening. The overdraft feature would give qualifying customers another option for managing temporary cash shortages.
Wallet transaction records could give PaySprint a clearer view of income patterns and repayment capacity, particularly for customers whose earnings fluctuate. This aligns with wider developments in transaction based credit scoring. The commercial opportunity depends on converting payment activity into sound credit decisions while keeping borrowing costs and defaults under control.
Talking Point
PYMO builds on PaySprint's existing payments business, with planned overdraft protection adding a potential source of revenue and deeper customer engagement. The challenge is to make that credit offering commercially sustainable without compromising affordability. Can PaySprint turn regular wallet use into a profitable credit business that works for customers with irregular income?
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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TD Expands Agentic AI Across Mortgage Operations
October 13, 2026 | Market Activity, Banking And Digital Banking, Mortgage Lending, Artificial Intelligence And Data
TD Cuts Mortgage Preparation From 15 Hours to Under 3 Mins and Extends AI to Funding and Discharge
On October 13, 2026, TD Bank Group expands use of agentic AI into Canadian mortgage funding and discharge operations, building on its May deployment for mortgage application reviews. TD reports that its earlier system reduced average preparation time from 15 hours to less than three minutes. Its new funding capability enables employees to complete initial reviews in up to half the time, while a separate application prepares mortgage discharge information for employee review.
TD is extending AI beyond application assessment into the administrative work required to complete mortgage transactions. For a bank processing large lending volumes, reducing that work could lower operating costs and increase employee capacity.
TD Applies AI to Three Mortgage Processes
TD introduced agentic AI for mortgage pre-adjudication in May 2026. Developed by its Layer 6 AI team with lending, technology and risk specialists, the system classifies application documents, extracts financial information, calculates income and checks selected policy requirements. It also flags discrepancies before preparing a summary for underwriters, who retain responsibility for lending decisions. TD's May mortgage AI announcement reported that this preparation process fell from an average of 15 hours to less than three minutes. Worth noting that the result doesn't represent the full time required to approve a mortgage.
For funding, the new AI capability brings together client and property information from different systems and prepares a case summary for employees. TD says the initial review can take up to 50% less time, but hasn't reported a corresponding reduction in the time needed to release funds. Its discharge capability assembles information for a mortgage discharge statement when a loan is paid off or transferred, while employees check the statement before issuance.
TD Targets Mortgage Costs and Staff Capacity
Mortgage administration requires employees to verify documents, reconcile information and resolve exceptions before transactions can proceed. TD is using AI to handle more of that repetitive work across several stages of the same lending business. If accuracy holds, employees can devote more time to complex files while the bank handles additional volume without a matching increase in administrative staffing.
See: AI Agents Expose Weak Links in Financial Authorization
While the May results give TD an operating basis for expanding its investment, the commercial case now depends on performance across complete transactions. Faster document preparation has limited value if funding still stalls over missing information or staff must repeat an AI review. For mortgage technology providers, software must work with existing bank systems, produce reliable records and allow employees to identify and correct errors. TD is also investing in faster credit processing through its Trust Science lending deployment in auto finance, where borrower information verification presents a related challenge.
Human Review Still Governs Mortgage Decisions
TD keeps employees responsible for credit decisions and final document reviews. AI prepares information for underwriters, funding teams and discharge staff rather than independently approving mortgages or completing legal discharges. That division of AI vs human is important because errors in income calculations, property records or discharge statements can delay transactions and expose both borrowers and lenders to additional costs.
The controls align with OSFI's frontier AI risk concerns as Canadian banks introduce more capable software into regulated operations. OSFI's agentic AI bulletin identifies sound practices for limiting system access, reviewing consequential actions and preserving accountability.
Talking Point
TD's mortgage AI expansion raises a bigger business question than processing speed. As automation reduces routine work, banks must decide how to use the capacity gained, whether through growth, lower costs or smaller teams. Will TD reinvest the savings in better mortgage service, or will workforce reductions become part of the return on its AI investment?
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Top Loan Origination Software Solutions for Private Lenders
October 13, 2026 | Private Lending, Loan Origination Software, Mortgage Technology
In private equity and alternative real estate finance, transaction velocity and precision dictate profitability. Unlike traditional institutional banks that rely on rigid, decades-old loan origination systems (LOS), hard money and private money lenders require specialized agility.
Implementing dedicated loan origination software for private lenders enables debt funds and private lenders to automate intake, accelerate underwriting, and streamline doc prep, ensuring faster capital deployment without compromising risk parameters.
What to Look For in Private Lending Loan Origination Software
Key Features for Hard Money and Private Real Estate Lenders
Private lending involves complex deal structures, including fix-and-flip bridge loans, DSCR rental loans, construction draws, and cross-collateralized commercial real estate debt. To support these programs, software must offer flexible field customization, multi-entity tracking, and flexible draw schedules.
Crucially, a robust system needs automated draw management capabilities to handle inspector uploads, holdbacks, and interest reserves without manual spreadsheet reconcilement.
Why Purpose-Built Tech Beats Generic Conventional LOS
Conventional banking platforms (such as Encompass or Byte) are designed for agency guidelines (Fannie Mae, Freddie Mac, FHA) and strict TRID/QM regulatory frameworks. They are fundamentally ill-equipped for non-agency private real estate finance.
Modern private lending software eliminates unnecessary conventional disclosures, replacing them with dynamic term sheet generators, custom LTV/LTC underwriting calculators, and direct investor reporting modules designed specifically for private equity capital structures.
Best Loan Origination Software for Private Lenders
| Software Solution | Core Specialty | Best For | Key Highlight |
| Mortgage Automator | End-to-End Origination, Servicing & Fund Management | Comprehensive, scalable lending operations | Automated term sheets, seamless servicing handoff, self-service portals |
| Liquid Logics | Cloud-Based Custom Operations | Large private funds and marketplace lenders | White-labeled portals, multi-tiered workflow engine |
| LendingWise | CRM + LOS Combination | Multi-product originators & broker networks | Integrated lead management, capital marketplace tools |
| Baseline | Modern, Fast Interface | Growth-stage private debt firms | Fast onboarding, intuitive UI, streamlined document generation |
| The Mortgage Office | Legacy Financial & Servicing Depth | Established hard money lenders | Advanced accounting ledgers, multi-investor fractional notes |
| BLN Software | Direct Real Estate Origination | Private real estate debt funds | Tailored fix-and-flip templates, construction draw tracking |
1. Mortgage Automator — Best Overall for End-to-End Origination & Servicing
Mortgage Automator stands out as the premier mortgage origination software platform for private debt funds and hard money institutions. It unifies the entire loan lifecycle into a single cloud ecosystem, seamlessly connecting initial intake to underwriting, document preparation, and post-closing servicing. Lenders can generate custom commitment letters in seconds, track pipeline milestones in real-time, and manage investor capital without juggling disconnected third-party software.
2. Liquid Logics — Best for Next-Gen Cloud Operations
Liquid Logics offers a highly customizable, cloud-native hard money loan origination system. Its Nova platform features fully brandable borrower, broker, and inspector portals. It provides one-click API integrations for background checks, credit pulls, title ordering, and appraisal management, making it an excellent fit for complex multi-state lending funds.
3. LendingWise — Best for Multi-Product CRM & Pipeline Management
LendingWise excels at combining sales enablement with processing workflows. Operating as both a powerful CRM and a full-featured LOS, it allows originators to manage leads, track broker performance, and handle fix-and-flip, DSCR, and commercial bridge applications inside a single workspace.
4. Baseline — Best for Fast-Growing Private Lending Teams
Baseline focuses on modern UI design, rapid deployment, and operational efficiency. Built specifically to eliminate administrative drag for scaling private lenders, it automates doc collection and pipeline status notifications, allowing lean teams to handle higher loan volumes without adding operational headcount.
5. The Mortgage Office — Best for Established Hard Money Lenders
A long-standing standard in private debt, The Mortgage Office provides deep fund accounting, fractionalized note tracking, and compliance management. It is particularly well-suited for established lenders that manage complex pool funds or syndicate loans across multiple private investors.
6. BLN Software — Best for Direct Private Real Estate Lenders
BLN Software is tailored specifically for private real estate debt strategies. Featuring pre-built workflows for residential fix-and-flip and ground-up construction, it simplifies scope-of-work reviews, budget tracking, and draw management for direct lenders.
How Automated Loan Origination Accelerates Deal Flow
Streamlining Intake with Borrower and Broker Portals
Using a dedicated borrower and broker portal transforms how applications enter your pipeline. Instead of chasing missing tax returns or entity documents over email, applicants upload files directly to a secure self-service portal. Automated task lists notify borrowers of pending conditions, preventing files from stalling prior to underwriting.
Automating Underwriting, Term Sheets, and Document Generation
By leveraging underwriting software for private lenders, decision-makers can instantly evaluate loan-to-value (LTV), loan-to-cost (LTC), and debt service coverage ratios (DSCR). Once approved, automated term sheets and loan documents are generated using pre-populated data fields. Integrating automated loan processing minimizes manual data entry errors, slashes processing timelines, and allows lenders to issue binding commitment letters in hours rather than days.
Connecting Origination Directly to Post-Closing Servicing
Efficiency doesn't end at funding. Modern platforms serve as a unified loan management system, bridging the gap between origination and servicing. When a loan closes, all borrower details, payment schedules, reserve accounts, and legal documents transfer automatically to the servicing module for ACH collection, interest statement generation, and draw management.
How to Choose the Right LOS for Your Private Lending Business
Evaluating Scalability, Integrations, and Onboarding Speed
When evaluating a mortgage automation platform, private lenders must assess three primary operational pillars:
- System Flexibility: Can the platform support your specific loan structures (e.g., Interest, construction holdbacks, cross-collateralization) without custom coding?
- Third-Party Integrations: Does the software offer open APIs or native connections for credit bureaus, background checks, eSignatures, and accounting software?
- Pipeline Visibility: Does the platform provide robust loan pipeline management dashboards to monitor team capacity, track bottlenecked files, and forecast funding liquidity?
See: Bitcoin as the Missing Denominator for Private Credit
Investing in purpose-built private real estate lending software ensures your organization can scale deal volume efficiently while maintaining institutional-grade oversight.
Scaling Your Private Lending Operations with Confidence
Selecting the right loan origination software is one of the most critical technology decisions a private debt fund or hard money lender can make. By replacing disjointed spreadsheets and legacy tools with automated workflows, secure portals, and integrated servicing, lenders can dramatically shorten time-to-close, lower operational overhead, and deliver a superior experience to borrowers and broker partners alike.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Can AI Credit Scoring Challenge Equifax and TransUnion?
October 9, 2026 | Insight, Lending Consumer Credit And BNPL, Artificial Intelligence And Data, Open Banking And Consumer Driven Finance, Competition And Market Structure
Better Credit Data Could Open New Financing Options for Underserved Borrowers
On October 6, 2026, U.S. fintech Plaid expanded its AI credit scoring products with LendScore 2, claiming 42% greater predictive power than traditional credit data alone. The announcement puts Plaid into closer competition with credit bureaus such as Equifax and TransUnion. It also creates an opportunity for lenders to assess borrowers using more detailed financial information and potentially offer financing that conventional credit scores and standardized loan products don't adequately support.
Someone with little credit history may have steady income and manageable expenses. A growing business may generate substantial annual revenue but receive payments irregularly. Neither fits neatly into conventional lending assessments. Better access to verified transaction data could help lenders make more informed credit decisions and develop products for borrowers who have traditionally been difficult to serve. The commercial benefits are promising, but greater scrutiny of personal and business finances also raises questions about affordability, privacy and fair treatment.
Plaid Brings New Competition to Credit Risk Scoring
Plaid built its business connecting financial accounts to digital services. Its expanded LendScore products now turn banking transactions and network information into predictive credit assessments. LendScore 2 includes specialized models for automotive, home and short term lending. LendScore Arc uses AI to examine transaction sequences, timing and relationships, while Instant Link lets returning consumers authorize access to financial information without repeatedly reconnecting their bank accounts.
Plaid reports that its automotive model reduced delinquency by 26% among deep subprime applicants at the same approval rate. Its home lending model reportedly supported 6.3% more approvals at comparable risk, while its short term lending model supported 63% more approvals under the company's testing conditions. These results involve different products, borrower populations and performance measures. The headline 42% gain measures predictive performance, not an equivalent increase in approvals or reduction in defaults.
Established credit bureaus are responding to similar demands. Equifax Cashflow Insights incorporates permissioned bank transaction information into credit assessment, while TransUnion TruVision offers a wider range of risk analytics using traditional and alternative information. Bureaus still maintain credit histories, furnish reports and support correction processes. Plaid supplies its new scores through a U.S. consumer reporting agency, bringing it into the regulated credit reporting market rather than replacing that market.
| Provider | Established Role | Growing Opportunity |
|---|---|---|
| Credit bureaus | Credit histories, reports, scores and verification | Combine established records with transaction data and advanced analytics |
| Financial data platforms | Account connectivity and authorized financial data access | Provide predictive scores and credit intelligence to lenders |
| Banks and fintech lenders | Underwriting, pricing, financing and servicing | Combine purchased scores with proprietary models and customized credit products |
Large lenders can combine their own customer and repayment information with external models. Smaller lenders may find it more economical to purchase specialist scoring services. Both remain responsible for their lending decisions, including model oversight and regulatory compliance. As NCFA's analysis of open banking decision intelligence explains, financial data becomes more commercially valuable when institutions can turn it into reliable decisions. Credit scoring is one market where that competition is already underway.
Can AI Make Custom Loans Affordable for Smaller Borrowers?
In an NCFA Fintech Fridays episode 66 interview clip, Merchant Growth founder and CEO David Gens describes a persistent financing problem for Canadian small businesses. Large companies have finance teams and sufficient borrowing scale to negotiate customized arrangements. Smaller companies usually don't. Banks also have less room to spend time structuring individual transactions when the loan amount is modest. As a result, businesses with limited physical assets but meaningful cash flow can find themselves offered financing that doesn't fit their operations.
Merchant Growth provides an operating example of how lenders can respond. In the full Fintech Fridays EP66 'What it takes to build $1.5 billion in small business lending', Gens explains how the company's proprietary Merchant Score combines personal credit information, application details and business banking transactions to assess repayment capacity. Merchant Growth offers different forms of financing, including term loans, revolving credit and revenue based arrangements. Its approach demonstrates that more detailed underwriting and flexible financing existed well before Plaid's latest products.
The next opportunity is to make this level of assessment economical for more lenders and smaller financing amounts. Better information and automated analysis could reduce the manual work needed to evaluate irregular revenue, recurring expenses, customer payments and changing financial conditions. That could support more appropriate loan amounts, repayment schedules and product choices. Canadian SME financing gaps explains why business characteristics, collateral requirements and financing economics continue to leave viable companies underserved.
A FinRegLab study of more than 38,000 small business loans found that cash flow information improved credit risk predictions, with particularly useful results for younger and financially constrained businesses. Separate consumer underwriting research found that combining bank transaction records, conventional credit information and machine learning could improve risk assessment and support additional approvals at comparable risk levels. These findings support alternative underwriting, although they don't establish the performance of Plaid's new models or prove that every borrower benefits.
Richer data also creates opportunities beyond adjusting conventional loan terms. Some financing structures already exist, but more automated assessment could make them practical for smaller borrowers or more specialized needs. The following are potential applications, not products announced by Plaid.
| Borrower Need | Potential Financing | Role of Better Data |
|---|---|---|
| Limited credit history | Starter credit with graduated limits | Verified income and payment behaviour provide additional evidence of repayment capacity |
| Irregular personal income | Income responsive loans | Payments could adjust within agreed limits as verified earnings change |
| Lumpy business revenue | Contract or receivables financing | Customer payment histories and invoices help assess expected collections |
| Seasonal business activity | Adaptive working capital | Borrowing capacity and repayment schedules could reflect established sales cycles |
| Early business growth | Milestone based financing | Funding could be released as verified operating targets are achieved |
These products would still need funding, reliable forecasts, appropriate pricing and ongoing risk management. A lender could understand a seasonal business perfectly and still face losses if the expected revenue doesn't arrive. Some borrowers may also be better served by equity investment or another form of financing rather than additional debt. The commercial opportunity lies in offering suitable products at a cost that works for borrowers and lenders, while keeping human judgment available when a business doesn't fit the model.
Will Better Credit Data Improve Lending Fairness?
Better credit data gives lenders more ways to identify a good borrower, but it also gives them more information to use when pricing a loan. Someone with irregular income could qualify for financing that a conventional credit score might have ruled out. That same transaction history could reveal periods of financial stress and lead to a higher rate, smaller credit limit or outright rejection. The lender gains greater pricing power unless competition, transparency and effective consumer protections keep pace. Plaid says LendScore Arc provides standardized explanations for its predictions, although its public materials don't establish that specific spending categories are penalized.
For lenders, the real commercial opportunity is to offer credit that reflects a customer's ability to repay without increasing losses. A seasonal repayment schedule might make financing viable for a business that struggles with fixed monthly payments. But a highly personalized offer could also leave customers paying more simply because the lender knows they have few alternatives. Better risk prediction doesn't automatically translate into better borrowing terms. Lenders need to demonstrate that new products improve affordability, repayment performance and customer retention. Borrowers need a practical way to understand and challenge the information behind their offers.
Canada's emerging consumer driven banking regulations could eventually make transaction information easier to share with competing lenders. Implementation remains underway, and Plaid hasn't confirmed that its latest LendScore products are available in Canada. The framework also draws an important commercial boundary. Consumers can authorize the sharing of eligible financial records, but derived data such as credit ratings and spending classifications is excluded from mandatory sharing. The underlying information may become more portable while the intelligence built from it remains proprietary.
That creates an opening for fintechs developing scoring models, underwriting systems and specialized credit products. It also protects a potential source of competitive advantage for incumbents that already hold extensive customer and repayment data. Smaller lenders may gain access to sophisticated analytics without building everything themselves, but they'll still need to control model costs, credit losses and servicing expenses. Firms that can demonstrate better loan performance and reach underserved customers economically will have a stronger business case than those selling another AI scoring tool.
NCFA's earlier analysis of underserved financial consumers identified how different income patterns, financial pressures and levels of trust create distinct product needs. More detailed credit intelligence could help address some of those gaps, provided it leads to financing customers can manage. The opportunity for Canadian fintechs is to compete on better credit products, not simply gather more information about borrowers.
Talking Point
Canada's small business lending experience shows that access to credit and financing fit are different problems. Better data can help address both, provided lenders can develop products that borrowers can afford and operate them profitably. Will competition in AI credit scoring produce better financing options for underserved borrowers, or mainly give lenders more ways to measure risk and price credit?
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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BDC, Woveo, Peloton and Driven Expand SME Financing
October 9, 2026 | Market Activity, SME Finance And Business Banking, Payments, Embedded Finance, Canada
C$10 Million in Microloans and Up to 55 Days of Supplier Payment Flexibility
On October 8, 2026, Calgary fintech Woveo and BDC announced a C$10 million microlending program, offering loans up to C$25,000. BDC and Woveo are helping entrepreneurs access smaller loans that conventional lenders may find costly to originate. Woveo's loans are available to qualifying businesses outside Quebec.
The same day, Peloton Technologies and Driven Financial announced a supplier payment and working capital partnership, giving Peloton's Canadian small business clients preferred access to Driven's financing products. Peloton's existing Bill Pay by Card service offers up to 55 days of payment flexibility through eligible credit card billing cycles, serving eligible clients across Canada. Peloton and Driven are connecting existing business payment customers with financing when their needs extend beyond a credit card billing cycle.
BDC and Woveo Target Small Loans That Banks Struggle to Serve
A C$15,000 business loan can require many of the same checks as a C$150,000 loan. For traditional lenders, the time spent verifying information, assessing risk and servicing a small balance can make the economics unattractive. Woveo combines AI assisted underwriting, banking transaction data, credit information and community accountability to evaluate borrowers. BDC contributes institutional capital through its Community Banking initiative, giving Woveo greater capacity to serve entrepreneurs seeking relatively small amounts.
The BDC and Woveo microloan program provides up to C$25,000 without traditional collateral. Applicants must have at least 12 months in business, C$5,000 in monthly revenue, a credit score of 600 or higher and a community accountability partner. The program excludes Quebec. These requirements mean the offering could help businesses underserved by conventional lenders, but it isn't unrestricted financing for new startups or borrowers without established revenue.
Woveo reports facilitating more than 1,200 loans with a 98% repayment rate through earlier community programs. The commercial opportunity is to make small business lending more economical while retaining sufficient oversight and borrower support. The program's longer term value will depend on loan performance, borrowing costs and whether participants can subsequently obtain larger financing from mainstream institutions.
Peloton and Driven Connect Supplier Payments With Business Loans
Peloton serves businesses that need to pay suppliers before customers have settled their invoices. Its Bill Pay by Card service lets eligible customers charge supplier payments to a credit card, even when the supplier doesn't accept cards. Peloton transfers the funds electronically, and the business pays its card issuer later. The arrangement can preserve cash for up to 55 days, depending on the card billing cycle, but it isn't a separate loan from Peloton.
See: Can AI Credit Scoring Challenge Equifax and TransUnion?
Peloton's published transaction fees start at 1.59% for consumer cards, 1.75% for corporate and purchasing cards, and 2.4% for business cards. Actual charges vary, and additional interest may apply when card balances aren't paid on time. An owner expecting a customer payment next week faces a different calculation from one borrowing to cover several months of expenses. Supplier discounts and card rewards may offset some transaction costs, but the business still needs to compare its total financing expense.
Driven (formerly Thinking Capital) and now part of Purpose Unlimited, provides separate business lending products for longer funding requirements. Its current Driven Financial company information reports more than C$1.6 billion in financing across over 20,000 Canadian businesses. Peloton clients receive preferred access to Driven, but lending decisions remain subject to assessment, and the companies haven't disclosed a shared underwriting system.
Canadian SME Financing Needs More Than Faster Approvals
Payment delays can leave Canadian small businesses short of cash even when sales are healthy. Payments Canada's 2026 Canadian payments data shows that 37% of surveyed SMEs consider payment delays a significant problem. A contractor waiting for customer payments may need temporary cash to cover suppliers, while another business might require a C$20,000 loan to purchase equipment or expand operations. The amount, repayment period and reason for borrowing determine which financing product makes sense.
Canada's SME financing gaps aren't explained by approval rates alone. Smaller businesses can struggle with application costs, collateral requirements and financing products designed for larger or more established borrowers. Woveo is addressing the economics of evaluating small loans. Peloton and Driven are using a payment relationship to connect businesses with financing.
Talking Point
BDC and Woveo are addressing the cost of serving smaller borrowers, while Peloton and Driven are combining payment services with access to business credit. Both arrangements could improve how Canadian SMEs find suitable financing, but the commercial and borrower benefits still need to be demonstrated. Can alternative lenders make smaller financing transactions profitable while offering terms that genuinely match how Canadian businesses earn and repay money?
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Where Canada’s SME Financing Process Still Breaks
September 22, 2026 | NCFA Story Intelligence | SME Finance And Business Banking, Open Banking And Open Finance, Capital Formation, Competition And Market Structure
Why High Approval Rates Still Hide SME Financing Friction
On September 17, 2026, the UK regulator went looking for evidence that its own rules were blocking small business finance.
It didn't find much.
Instead, the FCA SME finance review found problems scattered across the financing process. Some small firms don't know which product fits. Applications can be repetitive. Valuable businesses can own little conventional collateral. A lender can say no for reasons that have more to do with its own risk appetite than the health of the company. And after a decline, the entrepreneur may be left wondering where to go next.
Canada looks different at first glance.
Small business debt approval reached 97% in 2025.
That is a strong number. But approval is only one part of the financing process.
Why is the Competition Bureau reviewing SME lending, why did 76% of borrowers still have to pledge collateral, and why are specialist lenders building financing products around needs that conventional credit doesn't always serve?
The problem may not be a simple shortage of money.
It may be what happens between a viable SME and the right capital at the right stage of its life.
The UK expected to find regulatory barriers. The FCA concluded that its regulation was not a major obstacle to SME finance. What surfaced instead were problems with finance readiness, market navigation, risk assessment, repeated customer checks, product availability, alternative lending and personal guarantees. SMEs account for 60% of UK private sector employment, yet only 21% of the value of UK business loans goes to them.
Canada starts from a much stronger approval number, but fewer firms enter the debt market. ISED's 2025 Credit Conditions Survey found that 20% of small businesses requested debt and 97% received full or partial approval. Ninety seven per cent of requested dollars were authorized. The average amount approved was C$140,148 and the average interest rate fell to 5.8%. In the UK, around 50% of smaller businesses used external finance in Q3 2025, while challenger and specialist banks supplied 60% of gross SME bank lending. The measures aren't directly comparable because the UK figure includes credit cards, overdrafts, leasing and other products. Still, the UK data show SMEs using a wider range of external finance, alongside a market where challenger and specialist banks now provide 60% of gross SME bank lending. That makes Canada's 20% debt request rate worth looking at more closely.
The loan gets smaller. Much of the work doesn't. A lender still has to identify the customer, understand the business, assess risk, collect financial information, document the facility and service the account. The FCA found that high underwriting and customer support costs can make smaller or more complicated loans commercially unattractive. Bank of England research cited in the review found that operating and impairment costs mattered more than capital requirements in explaining weaker returns on SME lending.
Smaller firms can end up trying to fit products built for someone else. A bank can justify the time needed to structure a large commercial facility. The economics get harder when the business needs C$50,000 or C$100,000 and wants an answer quickly. David Gens, Founder and CEO of Merchant Growth, described that mismatch in a recent NCFA Fintech Fridays conversation. Merchant Growth has since funded more than 15,000 Canadian small businesses and deployed over C$1.5 billion, building around smaller financing needs and current business performance.
Collateral still carries enormous weight. In 2025, 76% of Canadian small business borrowers had to pledge collateral. The requirement reached 93% for long term debt. Buildings, machinery, inventory and receivables give lenders assets they can value and potentially recover if the borrower fails.
A fintech can become more valuable without owning much more that a lender can seize. Revenue rises. Customers renew. Software improves. Proprietary technology becomes harder to replicate. Yet BDC notes that patents and intellectual property can be harder for banks to value, making financing more difficult for businesses such as SaaS, ecommerce, cleantech and media companies.1
Canada has already decided to share some of that lending risk. The Canada Small Business Financing Program supported 6,409 loans worth almost C$1.9 billion in 2024 to 2025. Startups and businesses operating for less than one year received C$1.4 billion, or 74.1% of the total.
Follow the money and the old lending logic is still visible. Leasehold improvements accounted for C$1.2 billion and equipment another C$350.9 million. Working capital and intangible asset loans together represented only C$51.5 million, or 2.7% of program lending.
Revenue gives the lender something else to watch. BDC now says technology financing can take recurring revenue such as ARR and MRR into account. Predictable subscription revenue can help demonstrate repayment capacity even when profitability is still developing.2
The public guarantee can follow the loan through someone else's front door. BDC's Business Accelerator Loan Program supports working capital facilities between C$25,000 and C$500,000. The participating financial institution originates and manages the loan while BDC guarantees it.
The UK is trying to make business information do more work. The FCA sees open finance as a way to give lenders more complete and timely information, reduce duplicated applications and improve decisions. SME lending is one of the UK's first priority open finance use cases. The FCA plans to publish options for its first open finance scheme in early 2027.
Canada sees the same lending opportunity in consumer driven banking. Budget 2025 says the framework can reduce administrative work for SMEs, connect banking information with accounting, tax and payroll tools, support faster loan decisions and provide access to new forms of financing.3
Then comes the moment a lender says no. The FCA heard that some SME borrowers receive limited explanations for a decline. That can be particularly frustrating when the problem is lender specific. A bank may simply have little appetite for the sector, ticket size or type of risk. The business itself may still fit another provider perfectly well.
Canada can still leave the borrower back at the original door. Under BDC's Business Accelerator Loan Program, the participating institution manages the credit decision. If the borrower is declined, BDC says it has no visibility into the reason and directs the entrepreneur back to the financial institution for more information.
Canada is now looking closely at competition in SME lending. The Competition Bureau is reviewing SME loan competition in Canada, including lender entry, expansion and switching. The Bureau says Canada's market is dominated by large banks, smaller lenders appear to face barriers, comparing offers can be difficult and the borrowing cost gap between SMEs and large firms is wider than in many OECD countries.8
Meanwhile, Canada is adding capital further up the financing ladder. Budget 2025 committed C$1 billion to a new Venture and Growth Capital Catalyst Initiative and another C$750 million toward businesses facing early growth funding gaps.4
Manufacturers are already showing why timing matters. Only 87% of manufacturing applicants were approved for debt in ISED's 2025 survey, compared with 97% across small businesses overall. Now tariff pressure is hitting the same sector. Statistics Canada reported that 49.7% of manufacturers expected U.S. tariffs to hurt their business over the next 12 months, compared with 32.2% of Canadian businesses overall.5
Ottawa is responding with liquidity because the pressure arrives in cash flow first. The latest federal package adds C$1.5 billion to the Regional Tariff Response Initiative, a new C$500 million BDC liquidity stream for immediate cash flow pressure and another C$2 billion through the Canada Strong Diversification Fund.6
The UK is fixing friction inside the financing process. Its response includes better finance navigation, reform of referral after a declined application, better commercial credit data, digital verification, Consumer Credit Act reform and open finance focused directly on SME lending.
Canada is building capacity from several directions. Public guarantees support smaller loans. BDC lends directly and through partner institutions. Consumer driven banking can improve underwriting. The Competition Bureau is looking at lender competition. Ottawa is adding venture and growth capital. Tariff programs are supplying emergency liquidity.
Canada's SME finance numbers don't describe a credit desert. A 97% approval rate makes that clear.
A small business can have customers, revenue and a good reason to borrow and still be the wrong size for a lender's economics. A fintech can build valuable intellectual property faster than it builds conventional collateral. A manufacturer can suddenly need working capital because tariffs change its cash cycle. And a company that grows from C$25,000 of financing to C$250,000 can find itself proving the same business all over again.
Canada is already working on many of these problems. That's important. The opportunity isn't to replace banks, BDC or existing programs with one new solution.
It's to make the financing relationship itself work better as the SME changes.
Current business data can lower underwriting cost. Public guarantees can make smaller loans practical. Intellectual property can become easier to finance when valuation and recovery evidence improves. Consumer driven banking can help verified information travel. Specialist lenders can serve needs that large institutions aren't structured around. Growth equity can take over when debt stops being the right answer.
Put those pieces together and the financing process starts looking like a relationship that grows with the company (not disconnected and fragmented).
And for someone's sake, SMEs shouldn't have to become the wrong kind of business just to fit the available loan.
Talking Point
If a Canadian SME keeps proving itself through stronger revenue, better cash flow, customers and intellectual property, why should its financing relationship have to start over every time the business reaches a new stage?
FAQs
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit www.ncfacanada.org
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