Written by: Mike Senecal
Edited by: Lillian Guevara-Castro
Reviewed by: Adam West
- Our recent conversation with small business lender Biz2Credit’s founder and CEO Rohit Arora came just after his company’s most recent Frontiers of Digital Finance conference and a few days after President Trump’s inauguration.
- Arora sees a general easing of financial regulation ahead — including at the SBA, where initiatives are underway to refashion the government’s approach to small business lending.
- That will allow bank and credit union small business lenders to fuel more of America’s future resurgence, Arora said.
We caught up with Biz2Credit founder and CEO Rohit Arora a few weeks after the company’s latest Frontiers of Digital Finance event, held in Miami on January 13-14. The keynote speaker was Patrick McHenry, U.S. representative for North Carolina’s 10th congressional district from 2005 to 2025, who addressed a gathering of stakeholders in digital finance, open banking, AI, and embedded finance.
Arora has spearheaded Frontiers of Digital Finance events since 2017, shaping the subject matter and bringing together thought leaders, industry experts, and policymakers to discuss the latest trends and innovations — all part of his demanding schedule as a corporate leader.
To put it mildly, another event of some significance occurred about a week and a half before our talk: the inauguration of Donald Trump after four years of Joe Biden and a campaign in which financial deregulation, including at the SBA, was front and center.
Those events formed the framework of our wide-ranging conversation with Arora. America’s small business owners and lenders, he told us, should anticipate years ahead where the progress of the past and the promise of the future meet to reenergize the lending landscape. More digitization and less regulation will provide the fuel for SMBs, banks, and credit unions to drive U.S. global economic leadership.
It will take some doing to get there, but the puzzle pieces are quickly coming together under Trump, Arora said.
“The new administration is a little different in that they’re looking for ways and means to get the private sector more involved,” he said. “That is a significant net positive for SMBs and SMB lending.”
Reimagining Regulation
Arora said that’s due to commitment at the executive level and among majority Republicans in Congress to ease Biden strictures at the SBA so banks and credit unions have more incentive to compete for the small-dollar borrowers fueling the future.
He said a major pain point is that rules around the agency’s flagship 7(a) loan program mandate the same level of effort and compliance for lower-margin loans under $500,000 as higher-margin loans. The additional complexity and compliance costs make small-dollar loans less attractive to banks.
Those include fintechs partnered with financial institutions and non-bank entities with fewer regulatory constraints and more flexible repayment structures, including revenue-based lenders and merchant cash advance operations.
Arora said the Biden SBA “made a lot of noise” around small-ticket lending as more and more financial institutions abandoned or deemphasized 7(a) when faced with 30-year-old standard operating procedures and mountains of paperwork and documentation.
The new team, including incoming SBA head Kelly Loeffler, promises action to reduce delinquencies and defaults and prepare the program to accept increased demand.
“This is an opportunity for the incoming administration to reimagine it,” Arora said. “Progress has just stopped.”
It’s an imperative given President Trump’s dedication to the idea of bringing more manufacturing back to the U.S. — a goal he argues a comprehensive tariff system supports (along with other goals, such as stemming illegal migration and drugs).
And it’s part of a more comprehensive push for banking deregulation and an overall easing of the cost of doing business in the U.S.
“Small businesses will be the foundation of that growth,” Arora said. “How will you do that if you’re not able to increase access to small business credit?”
The Digital Future
As if the economic imperative weren’t enough, consider the expectations of small-business entrepreneurs from a customer-service perspective, Arora said. Due to digital transformation, small-dollar fintech and private lenders have stepped up as banks and credit unions have remained mired in regulatory stasis.
“As banks have withdrawn from the market, small business lending has become more like the credit card industry — with much more fragmentation,” Arora said. “During COVID, SMBs got more comfortable doing things digitally, and now they want a full digital journey.”
Arora knows this from experience. At Biz2Credit, 47% of applicants apply after business hours or during weekends, and open banking connect rates have increased from the mid-30s pre-COVID to 65% to 70%.
“More small businesses are doing more online banking,” Arora said. “They’re more comfortable connecting their bank accounts directly to data feeds.”
“With more deregulation coming in, everybody can focus more on actual business outcomes.”
Financial institutions feel an increased need to reach out digitally as branch networks atrophy in the wake of a brief period after the pandemic when many banks and credit unions announced new openings.
Just as more and more consumers grow accustomed to transacting online, often via mobile devices, so too do entrepreneurs who value the convenience of online banking, Arora said.
“Now, those are very secular trends, and they’re increasing,” he said. “And with the advent of AI, they’re going to get even bigger.”
That’s because AI settling into financial applications will be like putting the machines on steroids, Arora said. As software becomes smarter, it takes on more manual tasks to free the humans in the system to exercise judgment. Customized pricing and loan terms become automatic. The underwriting, adjudication, and just the cost of doing business in general “go down dramatically.”
That’s what we’re preparing for, Arora said. And the administration is behind it.
“We are living in very interesting times where a lot of different things are colliding with each other,” Arora said. “With more deregulation coming in, everybody can focus more on actual business outcomes. Which is great.”
