• The Fintech Brief
  • Posts
  • The Fintech Brief | Lending Innovation Isn’t Slowing Down - Just Shifting

The Fintech Brief | Lending Innovation Isn’t Slowing Down - Just Shifting

Plus: Block, California, and B2B payments signal what’s next for fintech credit.

A NEWSLETTER AFFILIATED TO

Editor’s Pick 📌

That’s the idea behind a new wave of embedded finance innovation, focused on removing the friction that’s held small businesses back for too long.

Liberis' new article outlines how:

  • AI-driven predictions are replacing one-size-fits-all models, adapting to each business’s growth stage, revenue patterns, and seasonality 

  • Starter Capital is helping entrepreneurs access initial funding—without needing a traditional credit history 

  • Integrated revenue data from across sales channels (think Shopify, card terminals, and bank accounts) is leading to offer increases of up to 230% 

The real shift? Finance that reflects how small businesses actually operate in 2025—multi-channel, real-time, and constantly evolving. This isn’t about offering more loans—it’s about designing funding that fits.

Industry Trends & Innovation 💡

GLOBAL PAYMENTS EXPANSION

Cross-border payments are projected to soar from $28.7 billion in 2023 to $149.22 billion by 2032, driven by the rapid growth of eCommerce, international remittances, and fintech advancements like blockchain. Businesses expanding globally need reliable, real-time payment solutions, while regulatory and security challenges remain key hurdles. If you’re looking at international trade or remittance, understanding this evolving payment landscape and its regional differences, especially the dominance of North America and Asia Pacific, is essential for making informed decisions.

FINTECH STRATEGY

Block is responding to slowing growth - Cash App profit up 10% year-on-year, user base flat—by investing heavily in AI (the internal “goose” tool), expanding digital lending via Cash App Borrow, and focusing on credit products for deeper user engagement. These moves matter as intensified FinTech competition tests their ambitious eCommerce strategy.

LENDING MARKET TRENDS

California’s personal loan market in 2025 is booming, led by digital lenders, tougher regulations, and a shift towards personalized, data-driven offers. Regional differences are stark: the Bay Area benefits from lower rates and fewer delinquencies, while the Central Valley battles higher rates and defaults. Expect AI, alternative data, ESG lending, and embedded finance to reshape borrowing, making it easier for some and more complex for others.

AI GOVERNANCE

Generative AI in finance demands robust governance, as current risk frameworks fail to address its distinct challenges—outputs are unpredictable, and oversight must be tailored. Institutions should start with small, high-impact projects, involving cross-functional teams, while ensuring transparent audit trails and compliance. Balancing adaptability and regulatory demands enables safer GenAI adoption.

STRATEGIC PARTNERSHIPS

Banks partnering with fintechs gain improved digital services, cost efficiency, and customer-centric solutions, but face considerable integration and regulatory hurdles. With regulatory scrutiny intensifying—especially around compliance, consumer protection, and third-party risk—banks must actively manage oversight, due diligence, and board engagement. Robust compliance training, clear risk frameworks, and independent audits are essential to safeguarding reputation and ensuring sustainable partnerships.

FINANCIAL TECHNOLOGY TRANSFORMATION

B2B payments are being transformed as automation, AI, and stablecoins enter mainstream eCommerce and finance, helping businesses manage cash flow instantly and reduce manual errors. Small businesses facing volatile trade policies benefit from these updated systems, enabling quicker adaptation to market shifts. If you’re managing business finances, now’s the time to evaluate automated solutions or stablecoin integrations for lower costs and improved visibility.

Bobsguide is a Contentive publication in the Finance division