Articles by deBanked Staff
deBanked’s Free Open Bar on Long Island – September 8
August 24, 2026deBanked is returning to Long Island for its annual FREE Open Bar this September 8th in Huntington. This event is open to brokers, funders, lenders, lead generators, tech companies, attorneys, collectors, bankers, investors, and more!
Crabtree’s is located at 330 New York Avenue in Huntington. Space is limited so make sure you register to attend early HERE.
Last year’s open bar in Huntington had a registered guest list of 300 people!
Soliciting Investments into an MCA or Business Lender on Behalf of Someone Else? Be Careful
August 19, 2026A recent civil lawsuit brought by the SEC against the orchestrator of an MCA funder-turned-Ponzi scheme came packed with claims against two other individuals who “acted as unregistered brokers.”
“The two were alleged to have solicited investors, explained the investment terms to those investors, vouched for the merits of the investment opportunity, facilitated the collection of investor funds, and received transaction-based compensation without ever registering as a broker-dealer with the Commission or associating with a registered broker-dealer,” the complaint alleges.
Unlike some syndication models, where investors pick and choose the individual deals they want to invest in, the defendants here told investors that the owner of the funding company would select which deals to fund with their money on his own. Investors were not entitled to know the names of the merchants due to confidentiality. Overall, the funder solicited at least 87 investors, raising at least $47 million, and promised fixed returns of between 22% and 53% on one-year investments and between 9% and 10% on shorter, two- to three-month investments.
The owner, who just pleaded guilty to wire fraud, misappropriated at least $11 million for himself—to pay gambling debts, personal credit card bills, home renovation expenses, and mortgage and car payments. He also used investor funds to pay earlier investors. While he did fund some deals, there were not that many. The scheme was able to go on for five years before collapsing in mid-2023.
The brokers who marketed the investment opportunity received commissions ranging from 5% to 25% of the amounts they brought in. They personally face claims that they violated Section 15(a) of the Exchange Act and should be enjoined.
The SEC complaint describes each of their violations “as a natural person not associated with a broker or dealer which is a person other than a natural person, made use the mails or any means or instrumentality of interstate commerce to effect transactions in, or to induce or attempt to induce the purchase or sale of, any security without being registered with the Commission as a broker-dealer.”
Figure: Business Loan Brokers Increasingly Arranging Deals Using Home Equity
August 14, 2026“What’s happening is people who have that home equity are using that to fund small business financing,” said Figure CEO Michael Tannenbaum on the company’s Q2 earnings call. “That’s a new avenue for us. We’re lapping about a year of us launching that, and it’s already grown to a meaningfully significant portion of our volume…we’re now signing up people that would historically not have been in the mortgage business whatsoever. They’re business loan originators, brokers, Fintech SMBs, but they’re able to use Figure because we make it so simple and easy and inexpensive.”
Figure has also made waves in the SMB market recently with the addition of an SMB loan pool to its Democratized Prime platform. The pool initially consisted primarily of loans originated by Credibly.
“The partners originating home equity loans for business purpose are also generating opportunities for Democratized Prime, as the SMB market has very little capital market standardization, and we therefore launched our SMB pool officially in July,” Tannenbaum said during the Q2 call.
Figure ultimately wants lenders to be able to access warehouse financing through Democratized Prime and then sell the loans they originate to investors through Figure Connect.
Small Business Funders That Made the 2026 Inc 5000 List
August 11, 2026The 2026 Inc 5000 list is out. Below are some of the familiar names that appeared from the financial services category:
(did we miss you? email us at info@debanked.com to be added!)
NerdWallet: “We are in the middle of an AI transition that is changing how people get their answers to their money questions”
August 7, 2026NerdWallet users have traditionally turned to Google to begin their financial journeys. A question entered into the search bar would surface a NerdWallet article, sending users to the company’s site. Now, that behavior is changing.
“We are in the middle of an AI transition that is changing how people get their answers to their money questions,” said NerdWallet CEO Tim Chen during the Q2 earnings call.
As the company has noted in previous quarters, some traffic is now coming from LLMs. While it remains a small share of overall traffic, those visitors tend to convert at a high rate.
“I think intent is extremely high when someone is coming through an LLM in terms of wanting to transact in a marketplace,” said Chen. “It continues to be a pretty small part of our business today, but it’s definitely an area of investment and growth for us.”
Analysts have continued to press the company on the subject. And while Chen has said that “the story is still being written,” he believes enough change has already taken place to provide a clearer picture of where things are headed.
“We’ve already entered a phase where you’ve got billions of weekly active users across major LLMs,” Chen said. “Mass adoption is already taking place, right? I think a lot of the impact that we’ve already seen in terms of our educational content being affected the last three years, has played out. I think we’re starting to see what the future looks like.”
Chen also emphasized that having a trusted brand will be critical to succeeding in this new era.
“The importance of that trusted brand when you’re talking about offering marketplaces and high stakes financial guidance is really front and center,” he said. “I just think we’re really well-positioned there.”
Shopify: “Capital was a larger driver this quarter”
August 6, 2026Shopify Capital originated $1.4B in small business loans and merchant cash advances in Q2.
“Capital was a larger driver this quarter, while loss rates in payments and credit are both at normalized levels,” said Shopify CFO Jeff Hoffmeister during the Q2 earnings call.
Beginning in April of this year, Shopify replaced its MCA product in Canada with a loan product in response to new regulations from 2025. It did not elaborate in the Q2 earnings on what specific regulations those were but it is possible they are referring to the amended national interest rate caps that went into effect on January 1, 2025. In a loan, an annualized percentage cost is determinable and controllable from the time the contract is made, whereas there is no predetermined controllable annualized rate on an MCA. Shopify disclosed that the main impact from switching from MCAs to loans in Canada was how it booked them in their financial statements.
Square Loans Continues Streak of Low Loss Rates
August 6, 2026“Square Loans are underwritten on data banks can’t see and serve sellers banks won’t. Our loan cohorts have had loss rates of less than 4% through every cycle we’ve seen,” said Block CEO Jack Dorsey in his Q2 shareholder letter.
Square Loans has led online small business lenders in originations for a while, bolstered mostly by its massive captive POS ecosystem, but solidified with the performance of those loans. Some of those loans are held on balance sheet while others are sold to third party investors.
Shopify Capital Transitions From MCAs to Loans in Canada
August 5, 2026“In 2025, Canada amended regulations that impacted merchant cash advance products,” Shopify said during its Q2 earnings. “As a result, we transitioned our Shopify Capital product in Canada, from merchant cash advances to loans which are accounted for under ASC 310, starting in April 2026.”
For the entirety of the quarter and for all geographic areas, Shopify Capital made $1.4B in loans and MCAs through a bank partnership.
