SMBs are a driving force in the economy, yet securing the necessary funding often remains a significant challenge. Traditional lending processes can be slow, complex, and frequently exclude businesses due to rigid requirements. For banks, especially smaller banks and regional institutions, the high operational costs and risk exposure associated with SMB lending can make it difficult to participate meaningfully in the market.
Embedded finance is changing the game. It allows banks to offer SMB loans in a streamlined, tech-enabled way—without assuming the full burden of credit risk, infrastructure, or servicing.
And for banks on the Q2 platform, you know the work has been done to vet and build the necessary technical integrations that allow Q2 members to take advantage of cutting-edge technology with low lift. Rapid Finance was selected to host their embedded SMB lending product on the Q2 platform, so member banks can future-proof their SMB offerings and increase revenue, all offered through the comprehensive Q2 platform.
A Shift in How Banks Serve SMBs
In today’s fast-moving digital economy, SMBs expect the same frictionless experiences they get from consumer and fintech platforms. Embedded finance allows banks to modernize their experience without building costly and time-consuming updates on their own. By integrating seamless white-labeled SMB lending solutions into their existing digital banking platforms, banks meet small business owners where they are.
Rather than managing underwriting, risk assessment, and loan servicing internally, banks can partner with third-party providers that specialize in purpose-built platforms for these areas. This approach lets banks offer loans to SMBs while transferring much of the risk management and operational burden to trusted partners.
For SMBs, embedded finance simplifies the borrowing process. Loans can be applied for directly within existing digital banking platforms, creating a faster, more convenient way for businesses to access the capital they need.
How Embedded Finance Supports SMB Lending
Embedded finance provides banks with a way to better serve SMBs without the typical risks associated with lending. It allows banks to:
- Scale without infrastructure investment
Banks can add fully-formed SMB lending programs to their portfolios without needing to develop new systems, hire lending teams, or take on additional compliance burden.
- Stay competitive in a rapidly evolving market
Large banks continue to dominate the SMB market. Embedded finance enables smaller institutions to respond with speed and innovation through with relevant, in-platform solutions. When banks offer financing with near-instant lending decisioning and a fully-digital application process, they improve their SMB customer retention.
- Reduce risk exposure
Because the embedded finance lending and risk management are handled by trusted third parties like Rapid Finance, banks can expand their offerings without taking on additional credit or operational risk.
- Create new revenue streams
By participating in embedded lending ecosystems, banks can share in revenue generated through referrals, usage, or servicing—without holding the loans on their own books.
How Rapid Finance Can Help
With over two decades of supporting small businesses, Rapid Finance brings deep expertise in SMB lending, risk management, and technology innovation to every embedded finance partnership. Having worked through multiple credit cycles and supported small businesses through several crises, Rapid has continuously evolved its technology platform and offerings to meet the changing needs of entrepreneurs and financial institutions alike. Rapid Finance’s platform, available on the Q2 Marketplace, allows banks to integrate intelligent small business lending solutions directly into their customer experience—unlocking access to working capital while minimizing risk and effort.
Key Features:
- Seamless integration with banking platforms like Q2
- Configurable loan products tailored to SMB needs
- Real-time eligibility checks and same-day funding
- End-to-end servicing, compliance, and risk management
- Access to the Rapid Funding Network, a network that prevents declines by routing applications to other trusted funders when needed
For banks looking to expand their SMB lending programs, Rapid Finance offers the tools to do so efficiently and securely. With a scalable, flexible solution, Rapid Finance empowers banks to provide the financing SMBs need to grow, while minimizing risk and maintaining operational efficiency.