The brakes are off, but the steering still matters
Few firms have had to earn their second chance more publicly than America’s biggest banks. Among them, Wells Fargo has been on one of the longest and most punishing roads to redemption in recent financial history.
Over the last few years, the bank has been busy rebuilding from within: restructuring leadership, simplifying its operations, modernizing technology, and tightening its risk controls. This reinvention wasn’t voluntary. Back in 2018, the Federal Reserve imposed a strict limit on Wells Fargo’s total assets, capping them at $1.95 trillion. This was all following a series of scandals, which included, most infamously, the creation of millions of fake customer accounts to meet sales targets.
Wells Fargo was barred from increasing its balance sheet because of the cap, which meant it could not:
Take on more deposits from customers (especially large commercial clients).
Make more loans to individuals or businesses beyond a certain level.
Expand trading books or grow in capital-intensive areas like investment banking.
Scale new business lines quickly, even if market demand exists.
Why it matters: In banking, growth typically comes from expanding assets: more deposits in, more loans out, more products sold, more capital at work. The cap froze Wells’ growth.
During 2018-2025, Wells Fargo likely had to:
Turn away new customers or shed low-yielding assets to make room
Prioritize efficiency and capital-light business areas (like wealth management or advisory)
Focus on fixing internal controls instead of aggressively competing in the market
In June 2025, that cap was finally lifted. After more than seven years, the bank is no longer under the growth restrictions that defined its post-scandal trajectory. This is more than regulatory housekeeping; it marks the end of Wells’ painful chapter and opens up the beginning of a new era of competitiveness.
But this development also raises a critical question: What did it cost Wells to get here? And what exactly does it plan to do with its regained freedom?
Non-bank financial institutions (NBFIs) are capturing more and more market share in SME lending by leveraging technology to offer quicker lending solutions. This puts pressure on FIs to evolve their approaches while managing costs and improving service quality.
Finastra’s Principal Product Manager Kristen Lista joins the Tearsheet podcast today to discuss the most critical areas where FIs need to focus: consolidating technology to improve efficiency, decreasing the time between application and access to funding, enhancing back-office operations, and creating more client-centric experiences.
Lista offers a valuable look inside the complex web of challenges that FIs are facing when trying to improve the SME lending products. From technology integration strategies to practical advice on process improvement, Lista offers an actionable blueprint that can help FIs better compete in the SME lending space, driving growth and customer loyalty.
Limited credit history, lack of collateral, and sitting outside FI’s credit box prevent SMEs from tapping much-needed financial resources.
Addressing these barriers requires financial institutions to embrace digital transformation: “To overcome these barriers, FIs have to innovate and embrace digital transformation, and that helps to provide faster, more efficient lending decisions, ultimately getting to that time to say yes much quicker to provide for the SMEs funding needs.”
The threat of new entrants
Traditional financial institutions face significant challenges competing with more agile non-bank lenders in the SME space. Lista points out that NBFIs have gained market share by utilizing technology to streamline the lending process.
“Traditional FIs really are struggling to compete with non-bank financial institutions in the SME lending space, because NBFIs leverage technology to offer faster, more flexible lending solutions,” Lista noted. She added that financial institutions also face a tighter cost basis in the SME lending space, which means they need to find ways to reduce costs without compromising service quality, which is very tough to do.
But beyond technology and cost challenges, FIs may be overlooking a chance to diversify their offerings: “There’s really an opportunity and a need for FIs to grow into different asset classes as well, such as moving from SME lending into commercial and syndicated lending, which can help FIs diversify their risk and open new revenue streams.”
How technology can help FIs build better CX
CX and bank office efficiency play a critical role in the relationship SMEs have with their FIs – technology in validating financial statements, automating underwriting, and enhancing loan servicing capabilities all contribute to the quality of service SMEs receive from their FIs.
Lista also highlighted a frequently overlooked area, loan servicing. It’s here that FIs have a particularly important investment to make: “Loan servicing is kind of an afterthought in digital transformation, but it really can’t be an afterthought anymore. Loan servicing capabilities have to have that digital transformation, as well, and provide for better communication and transparency for bank clients.”
The importance of modernizing back-office operations
One reason why FIs have struggled to keep up with the pace of their competitors is their historical underinvestment in back-office operations.
“FIs really haven’t focused on the back-office servicing operations of the SME lending process,” Lista said. “There’s a lot of reasons for that. Primarily, they’ve been underfunded because banks thought that the back-office was not revenue generating, and so they would really focus their resources and their budget going towards client-facing systems.”
Blueprint for customer retention and growth
At a time when FIs have to play catch up with their NBFI counterparts, the key to their success may lie in focusing on customer needs, expectations, and experience.
On the revenue front, Lista noted that while SME loans are typically lower in value, they’re higher in volume, creating a unique opportunity: “In order to grow their revenue, they have to prioritize the customer experience to get that retention and loyalty, and if they do that, they may see an approximate two and a half times increase in their revenue growth compared to those who do not prioritize customer centricity.”
To-do list: What FIs can do to better serve their SME customers
FIs that want to improve their SME customer experience can take the following steps:
– Gain a full system view: Undertake a detailed overview of the systems involved from loan initiation through servicing and termination. “Key systems that you should look at are customer portals, your borrower portals. You should be looking across the ecosystem at KYC, AML systems, loan origination systems, loan documentation systems, and, of course, your loan servicing system.”
– Evaluate potential for automation: Integration between these systems that contribute to the loan servicing process is crucial: “It’s important to look at what they’re doing, what the purpose is, but also, how do you automate and integrate these systems together and piece them together in an automated way throughout the ecosystem?”
– Don’t overlook KYC and AML – they impact CX: KYC and AML processes have a significant impact on turnaround time and customer experience. When considering modernization strategies, this is a critical area of evaluation with a CX lens. Complex KYC and AML processes can impact onboarding success and impact client retention. “If they don’t have smooth transitions from a portal to a KYC system, for example, the borrower is going to feel the delay and the impact,” said Lista.
– Find technology partners that can technological lift in automation: Tools like Finastra’s offerings can help FIs create a consolidated and streamlined lending ecosystem.
“Finastra offers a lot of solutions to enable this consolidated and streamlined end-to-end ecosystem,” Lista said. “Our products help FIs to digitally transform their ecosystems to provide those right SME offerings and mirror up with their demands and expectations.”
– Integrate teams into SME strategy: “FIs must not only look at the technology, but they must also integrate their people and processes within the technology as well,” Lista advised. “Enhancing collaboration across business segments—the front office, the back office, the middle office—and also working with their IT departments and their technology departments internally. That collaboration is key.”
To read more about what FIs can do to build competitive lending experiences and products for SMEs and find partners that can accelerate modernization efforts and positively impact bottom lines, please visit Finastra’s website.
In the early 2010s, Wise (then known as TransferWise) made a name for itself by targeting the bloated fees of international money transfers. Its brand was scrappy and distinctly European. But over a decade later, the company’s next chapter isn’t being penned in London or Tallinn, but on Wall Street.
Earlier this month, Wise announced it plans to shift its primary stock listing to the US, a move both strategic and symbolic that underscores tectonic shifts in the global listings landscape.
From crown jewel to continental drift: The primary London listing exodus Before zeroing in on Wise’s decision, let’s take a step back to analyze the situation at the London Stock Exchange (LSE). The past five years have seen a steady drip of high-profile companies leaving the LSE in favor of the US, a migration that now totals over $100 billion in market cap.
Marsh & McLennan, a professional services provider in risk, strategy, and HR, announced its plan to delist from the LSE in October 2023 and cancel its listing on the Official List of the UK Financial Conduct Authority. The company cited the disproportionate costs and administrative burdens of maintaining a secondary listing in London, given that the majority of its trading occurs on the New York Stock Exchange (NYSE). The delisting took effect on November 27, 2023. Similarly, other firms like construction supplier Ferguson and pharmaceutical firm Indivior have all either moved or are moving primary listings to US exchanges.
The reasons cited are familiar: lackluster liquidity in London, persistently lower valuations, and limited index inclusion options for growth companies. Despite the UK’s post-Brexit ambitions to become a tech and finance hub, its primary exchange seems increasingly less appealing to the very firms that represent its future.
Wise’s situation fits this mold, but also tells us more.
From payments to investments: The divergent paths of AI transformation
It’s a new week of the 10Q edition, and the conversation around AI isn’t slowing down. And judging by the pace of innovation, companies are in no mood to rest.
We track two new AI developments this week from well-known public companies: Square, the payments and commerce unit of Block, and legacy bank Morgan Stanley.
AI In Payments: How Square’s Conversational AI Assistant signals a shift in SMB tech — and why it matters
Square has introduced a conversational AI assistant, Square AI, to help sellers by answering questions about using Square’s business technology platform and providing insights into their own business trends.
In a time when nearly every company is racing to slap AI onto a product label, Square’s latest move feels different, not because it’s more technically sophisticated, but because it directly addresses a chronic pain point for small business owners: decision paralysis in the face of complexity.
Fintech lending dives deeper into the algorithm age
Wall Street loves a good buzzword, but when AI appears on quarterly earnings calls and product roadmaps, it’s not just talk – it’s a pivot. Over the past week, some of the non-headline-grabbing public financial firms have moved their advanced AI efforts into production, beyond the lab phase and into frontline operations.
We look at how Pagaya and Upstart fit into today’s narrative, which goes beyond their AI initiatives to focus on how they are operationalizing those efforts and gradually integrating AI into their company architecture.
Pagaya’s AI engine is now powering a $300 million BNPL push
For anyone watching the mechanics of modern consumer finance, Pagaya is making an effort to become one of the critical AI players in the lending world.
Founded in Israel and listed on the NASDAQ [PGY], Pagaya built its name on a very particular skill: using artificial intelligence to underwrite “second-look” loans, the kind traditional lenders might decline at first glance. The company’s bread and butter is partnering with financial institutions that want to expand credit access without eating a mountain of risk. Its AI models pore over alternative data and make fine-tuned credit decisions that don’t rely solely on FICO scores.
Recent AI developments
i) BNPL Bond Issuance: In the past week, Pagaya made a big move: it issued a $300 million bond backed by buy now, pay later (BNPL) loans, a first for the company. It did this in partnership with Klarna, the Swedish BNPL giant that’s been revamping its financials ahead of a possible IPO. The bond deal, arranged by J.P. Morgan Chase and Apollo’s Atlas, gives Klarna more flexibility to offload credit exposure while allowing Pagaya to flex its AI muscle in a hot but volatile space. The bond was oversubscribed and included AAA-rated tranches yielding about 1.75 percentage points above Treasury bonds, indicating strong investor demand despite higher risk premiums compared to competitors like Affirm.
What makes this interesting is that Pagaya is applying its AI underwriting system to a new frontier, point-of-sale financing, where risks are nuanced, margins are thin, and speed is everything. Klarna handles the consumer touchpoints; Pagaya, behind the curtain, crunches the credit decisions and helps get the funding flowing.
ii) Asset-Backed Securities (ABS) Issuances: This isn’t Pagaya’s first rodeo in asset-backed securities…
What we’re seeing now is Pagaya expanding its model, not pivoting. The BNPL-backed bond is less about jumping on a trend and more about applying its proven tech stack to an adjacent product, one that’s booming in retail but increasingly scrutinized for risk.
A conversation on Remitly’s financial performance, platform integration, & conversational AI developments
The tech world loves a good shake-up story, especially when it comes to payments. But when the goal is only to upend an industry, things can get lost in translation. While speed and innovation are great, and one of the essential aspects of payments, for many, even small barriers to sending money can feel like an insurmountable challenge. That’s the market Remitly has focused on. The payments firm is solving a more fundamental problem — how to make sending money home a little more predictable, a little less frustrating.
Earlier this month, Remitly shared its Q1 2025 financial results. First quarter revenue was $361.6 million, up 34% YoY, and active customers increased to over 8 million, up 29%.
A week before its earnings release, the company announced its integration with WhatsApp. Through WhatsApp, Remitly users can send, monitor, and control their international transfers without downloading another app. Remitly’s goal isn’t necessarily to get users to only use the app — it’s to keep them in the Remitly ecosystem, regardless of channel.
I spoke with Matt Oppenheimer, co-founder and CEO of Remitly, to discuss the Q1 earnings highlights, and with Ankur Sinha, Chief Product and Technology Officer, to learn more about the new WhatsApp integration and what this launch signals about the future of remittances and fintech UX.
We also explore the role of Remitly’s conversational AI in enabling users to send money directly within WhatsApp, check live exchange rates and fees before sending, and track transfers — all while receiving support in a single conversation thread.
Matt Oppenheimer, Co-Founder and CEO, Remitly
Q: What key strategies contributed to Remitly’s Q1 2025 positive outcome?
Matt Oppenheimer: Our strong Q1 results reflect the compounding effect of three core drivers:
The growth paths of 2 fintechs through their recent quarterly earnings
The earnings cycle has commenced, and companies are beginning to report their first set of financial results for this year.
A week ago, Affirm disclosed its financial results. We assess the firm’s performance, tracing its evolution and exploring what likely lies ahead for the BNPL provider.
AFFIRM
Affirm’s roots run deep in the desire to rethink how we interact with money, specifically when it comes to buying stuff we want, but perhaps can’t always afford upfront.
In an increasingly digital world, it’s a business model that resonated with consumers seeking flexibility.
A look at Q3 2025: Still on the up and up Now, let’s talk shop. For Q3 2025, Affirm posted strong numbers that got the analysts sitting up a bit straighter. The company reported a revenue increase of 36% to $783 million in revenue, topping expectations. GMV growth accelerated, up 36% YoY to $8.6 billion. The active consumer base reached approximately 22 million, with nearly 2 million new users in the last quarter. Repeat users still accounted for 94% of all transactions.
What stands out about Affirm’s performance this quarter is the momentum they’ve built in key growth areas. Consumer spending is bouncing back, and Affirm’s BNPL service is benefiting from that as people are increasingly seeking more control over their finances. But there’s more going on under the hood.
Crypto meets convenience with Green Dot’s Retail Network
Green Dot and Crypto.com are teaming up to expand banking and money management features for Crypto.com’s US users — a move that brings traditional financial tools closer to the crypto world. The partnership gives Crypto.com customers new ways to fund and manage their Cash Accounts, including earning interest and depositing US dollars digitally or with cash at Green Dot’s nationwide retail network.
At the core of the collaboration is Green Dot’s embedded finance platform, Arc, which will power a new interest-earning savings vault and streamline the movement of money into and out of Crypto.com accounts.
For Crypto.com, which offers access to more than 350 cryptocurrencies, the added infrastructure could help make digital assets more accessible to mainstream users. And with several locations in the Green Dot Network — ranging from Walmart to CVS — the companies are betting that the real-world utility of crypto begins with meeting customers where they are.
Why partnerships like these matter: The gap between fiat currencies and digital assets continues to be a major obstacle to broader cryptocurrency adoption. This challenge presents an opportunity for banking-as-a-service (BaaS) providers that already operate within established regulatory frameworks and payment infrastructures to step in and deliver value.
If you’ve been keeping tabs on Silicon Valley’s power players lately, you might have noticed something interesting: Intuit has been unusually quiet. No flashy keynotes. No viral product demos. No crypto moonshots or AI-fueled promises to change the world (at least not too loudly IMO).
But silence doesn’t mean stasis. The company has been playing its cards close to the chest lately.
If you zoom out and squint a little, there’s a quiet — but deliberate — transformation underway. Behind the scenes, Intuit is doing what many seasoned companies with established customer bases aim to do: build out an end-to-end ecosystem so sticky and essential that customers don’t want — or need — to leave.
The firm is likely on that trajectory, making a shift from that tax company into something more expansive: a full-spectrum financial operating system. And it’s doing that through carefully chosen, strategic acquisitions.
The acquisition spree: In April, Intuit announced plans to acquire Deserve, a mobile-first credit card platform, and also signed an agreement to acquire HR platform GoCo. The press releases were tidy, but the impact of these moves is anything but small.
They signal a clear thesis: Intuit is doubling down on owning more of the financial lifecycle, especially for small to midsize businesses (SMBs), where it already holds a strong foothold with QuickBooks. But instead of reinventing the wheel, it’s opting to buy the ones that are already spinning efficiently.
Inside NVIDIA’s Vision: Deploying Agentic AI in Financial Markets
The tariff war is throwing punches at the stock market, leaving it dazed and confused, while IPOs — Klarna included — are nervously tiptoeing back into the shadows. It’s a moody scene out there. But instead of wallowing in unstable economic times, let’s take a breather and pivot to something more exciting: AI. Within this broader narrative, we’ll zero in on a California tech firm moving deeper into financial services with its new AI systems.
Nvidia (NASDAQ: NVDA) has long been recognized for its expertise in designing and producing high-performance graphics processing units (GPUs) — chips that are key components in gaming, professional visualization, data centers, and AI. The firm has seen its technology adopted across a wide range of sectors, from deep learning and autonomous vehicles to scientific research.
Now, Nvidia is playing a very different game: it’s quietly becoming one of the influential back-end partners to the financial world’s artificial intelligence (AI) awakening.
Today, the company is increasingly positioning itself as a foundational infrastructure provider for AI development, with growing influence in financial services beyond its traditional tech roots.
We explore how.
AI Agents: Financial firms’ new (non-unionized) analysts
