What happens when Embedded Lending evolves from a nice-to-have experiment to a must-have competitive advantage?
In the latest Embedded Finance Review podcast episode, I speak with Jens Roehrborn, co-founder of Banxware, a German embedded lending provider. Over the past six years, Jens has witnessed platforms transform their financing approaches for SME customers. E-commerce sites, neobanks, and accounting software have all embraced embedded lending.
We dive deep into Banxware's strategic shift from direct lender to what Jens calls a "lending enabler." It's an orchestration layer that connects platforms with multiple funding sources, including traditional banks such as UniCredit's German subsidiary.
Banxware's model now serves over 2 million SMEs across more than 40 platform integrations. Jens explains why traditional banks are eager to participate: they want access to SMEs they struggle to reach on their own, and they need a user experience that matches that of neobanks. Through their UniCredit partnership, Banxware reduced the credit decision process to a maximum of three days.
We also discuss the challenge that sparked this shift. On most platforms, smaller high-risk businesses were being served by alternative lenders at high rates, while larger price-sensitive merchants remained underserved and still had to go through traditional bank applications. The orchestration approach solves this by routing each application to the lowest cost lender for which the business qualifies.
Jens predicts that embedded finance will become as essential as online payments for platform competitiveness. Platforms that don't offer it will lose out on customer retention.