Weekly Newsletter – November 23, 2025 -

November 23, 2025 — Today’s financial landscape presents both challenges and opportunities for businesses navigating credit access, capital markets, and cost pressures. This newsletter examines three interconnected trends reshaping business finance: the rise of automated credit underwriting tools, record-breaking non-bank securitization, and the affordability crisis hitting small businesses. Understanding these developments is crucial for strategic planning and financial resilience in today’s economic environment.

Automated Credit Underwriting Tools: What Decision-Makers Need to Know

Automated credit underwriting tools combine intelligent document processing (OCR/IDP), rules-based decision engines, machine-learning risk models, real-time fraud detection, and workflow orchestration to move decisions from days or weeks to hours (or minutes) while maintaining audit trails and compliance records. Source Source

Core business impacts: Vendors and case studies report approval and processing time reductions measured in tens of percent—in some implementations compressing turn-times from weeks to hours. Source Independent vendor guidance indicates underwriting automation can cut manual workload substantially, with Deloitte cited for ~50% potential task time reductions. Source Providers and implementers report material cost reductions (commonly 30–40% in published vendor case narratives) plus improved data quality and fewer defects. Source Source

Vendor capabilities: Look for solutions that integrate with your LOS via APIs, ingest ACORD/forms and bank feeds, apply explainable ML models, surface exception workflows (human-in-the-loop), and produce full audit trails. Source Recent product innovations show vendors are now automating not just decisions but post-approval remediation workstreams. Source

Implementation risks & controls: Primary risks include legacy system integration, data security/privacy, regulatory explainability, and model bias. Mitigations include phased pilots, SOC-2/ISO controls, model documentation/explainability, human escalation rules, and continuous monitoring. Source Source

Practical next steps: 1) Run a 60–90 day pilot on a high-volume, low-complexity product to prove straight-through processing rates and measure turnaround time and defect reduction. 2) Require vendor evidence of security/compliance and model explainability. Source 3) Define KPIs up front and commit to a governance cadence to monitor drift and regulatory changes. Source

Record Non-Bank ABS: Capital on Tap’s £500m Master Trust Sets a New Benchmark

Capital on Tap has closed “London Cards 3,” a £500 million asset-backed securitisation (ABS) of business-credit-card receivables—the largest non-bank credit-card ABS ever issued in Europe—and secured investment-grade ratings on all tranches, giving the fintech a deep, flexible funding platform to scale SMB lending and product development. Source Source

Why it matters: The deal is backed by receivables from Capital on Tap’s >200,000 small-business customers and attracted broad institutional demand, a signal of investor confidence in non-bank consumer and SME credit pools. Source Structuring the portfolio into a master trust with joint lead managers gives the firm ongoing access to capital markets and more efficient liquidity management—important as traditional bank credit tightens for SMEs. Source CEO Damian Brychcy framed the transaction as both a milestone and operational fuel to “empower SMBs with the tools and credit they need to thrive.” Source

Broader context: This transaction sits within a rising wave of non-bank securitisation globally—examples this year include sizable other-ABS deals in Australia and Europe. Non-bank issuers in Australia have placed multiple ABS issuances in 2025 totaling several billion dollars. Source Source

Implications for stakeholders: For issuers, master trust formats and investment-grade outcomes lower future funding costs and improve optionality. Investors gain expanding non-bank ABS supply offering diversified yield exposure to consumer/SMB receivables outside traditional banks. SMEs benefit from more predictable, scalable credit supply from fintech issuers that may help offset tightening bank lending conditions.

Affordability Crisis Hits Small Businesses

Small firms are being squeezed by multiple, compounding cost pressures—higher import tariffs, rising payroll and healthcare expenses, tighter credit, and a fraying labor supply—forcing layoffs, price hikes, and operational shifts.

Key facts and impacts: The Budget Lab estimates the average US tariff rate has risen to about 16.8%—the highest since the 1930s—increasing input costs for firms that rely on global supply chains. Source The Federal Reserve Bank of Kansas City noted average rates on new urban small-business term loans were above 7% late last year, while many businesses face rates well north of 10%, constraining investment and hiring. Source

For firms with fewer than 50 employees, the average cost of single-coverage health insurance has surged roughly 120% over two decades, creating a competitive hiring disadvantage versus larger employers. Source Roughly one in four US households are estimated to be living paycheck-to-paycheck, increasing employee financial stress and on-the-job distraction for small-business workers. Source

The Small Business Administration (SBA) expanded lending activity recently—approving tens of thousands of loans and guaranteeing a record level of small-business loans in FY2025—but many owners still report prohibitively high private borrowing costs. Source

Voices from Main Street: “Everyone is hunkering down and building up cash. It’s never been this bad,” said a family-run manufacturer that recently cut staff in response to tariff and demand shocks. Source “It’s unbelievable how much healthcare has gone up… It’s an unfair barrier to hiring,” said a small-business CEO describing rising employee benefits costs. Source

What leaders should prioritize now: Preserve liquidity by building short-term cash buffers and tightening working-capital cycles. Revisit supply chains to assess tariff exposure and consider near-sourcing where feasible. Source Explore SBA programs and local small-business initiatives to reduce reliance on high-cost private credit. Source Offer targeted, affordable workforce supports to reduce distraction and turnover given household financial stress. Source

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As we navigate these interconnected financial trends, businesses that adapt quickly will gain competitive advantage. The rise of automated underwriting tools offers efficiency gains that can offset rising costs, while innovations in capital markets like the Capital on Tap securitization demonstrate new funding pathways beyond traditional banking. Meanwhile, the affordability crisis demands immediate attention to liquidity, supply chains, and workforce stability. Going forward, strategic financial planning must account for this changing landscape—optimizing credit access, exploring alternative funding sources, and carefully managing costs to ensure resilience and growth potential in 2026.