How OnDeck's AI Growth Report Reshapes MCA Underwriting Best Practices

Small Businesses Are Embracing AI. MCA Funders Need to Keep Up.

A new report from OnDeck reveals that small businesses across the United States are leaning into growth strategies and AI adoption at rates that would have been hard to imagine even two years ago. The findings paint a picture of a merchant base that is more technologically fluent, more data-aware, and more impatient with slow funding processes than ever before. For MCA funders and underwriters, this shift carries direct implications for how deals get sourced, evaluated, and closed.

When your applicants are already using AI to manage their own operations, showing up with a manual verification call and a spreadsheet creates friction that kills deals. The OnDeck Small Business Trends Report confirms what many in the alternative lending space have suspected: the sophistication gap between merchants and funders is narrowing fast, and in some cases, reversing entirely.

This article breaks down what the report means for MCA underwriting best practices, why traditional verification workflows are increasingly misaligned with merchant expectations, and how funders can adapt without compromising on due diligence or fraud prevention.

Growth-Oriented Merchants Change the Underwriting Risk Calculus

AI Adoption Signals Operational Maturity

The OnDeck report highlights that a growing share of small businesses are deploying AI tools for bookkeeping, inventory management, customer engagement, and cash flow forecasting. This is not a marginal trend. When a restaurant owner uses AI to predict weekly revenue or an e-commerce operator automates inventory reordering, the data trail those businesses generate becomes richer and more structured.

For MCA underwriters, this matters because the quality of the data you can extract during verification is directly tied to the sophistication of the merchant's financial infrastructure. A business running QuickBooks with AI-powered categorization produces cleaner bank statements, more predictable deposit patterns, and fewer anomalies that trigger false fraud flags. Underwriting teams that still treat every applicant as if they are working from a paper ledger are missing signals that could accelerate approvals and reduce default risk.

Growth Mindset Means Higher Funding Demand

The report also shows that SMBs are investing in expansion, hiring, and technology at elevated rates compared to 2024 and 2025. Growth-oriented merchants tend to seek funding earlier in their business cycle, often before traditional metrics like years-in-business or average daily balance hit conventional thresholds. This creates a tension in underwriting: the merchants most likely to generate strong returns are also the ones whose profiles look riskiest under legacy scoring models.

Adapting MCA underwriting best practices to this reality requires moving beyond snapshot-based analysis. A single month of bank statements tells you very little about a business that is actively scaling. What matters is the trajectory of deposits, the consistency of cash inflows relative to outflows, and the presence or absence of red flags like stacking indicators or sudden balance drops. As we explored in our analysis of how OnDeck's growth optimism data reshapes underwriting practices, the funders winning in 2026 are the ones treating cash flow trajectory as a first-class underwriting signal.

Speed Expectations Are Non-Negotiable

Merchants who use AI in their own operations expect their funding partners to move at a similar pace. When an applicant can get a same-day answer from an embedded lending product inside their point-of-sale system, asking them to schedule a live verification call next Tuesday feels archaic. The competitive pressure from platforms like Shopify Capital and Square Lending, which fund merchants with zero human interaction, has reset the baseline for what "fast" means.

Independent MCA funders cannot replicate the embedded data advantages of platform lenders. But they can eliminate the most obvious bottleneck in their workflow: the synchronous verification call. Async verification, where applicants record their banking portal at their own convenience and underwriters review on demand, removes scheduling friction entirely. Exact Balance was built specifically for this workflow, replacing live calls with browser-based screen recordings that capture the same evidence in a fraction of the time.

Building Verification Workflows That Match Merchant Sophistication

Stop Treating Verification as a Checkpoint

Traditional bank verification operates as a binary gate: pass or fail, done or not done. The applicant calls in, an underwriter walks them through their banking portal, and someone checks a box. This approach wastes the richest data source in MCA underwriting by reducing it to a yes-or-no exercise.

Modern verification should function as a data extraction layer. When an applicant records their banking session, the resulting video captures not just whether the transactions are real, but how the portal behaves in real time. Does the page load naturally? Do balances update dynamically? Are there visual artifacts consistent with manipulated screenshots or developer-tools edits? AI-powered analysis of recorded banking sessions can flag inconsistencies that a human reviewer on a live call would never catch, simply because the AI can compare frame-by-frame rendering against known patterns of legitimate banking portals.

We covered this in depth in our piece on how MCA lenders use AI to detect fake banking sessions in screen recordings. The core insight remains: video evidence of a live banking session is orders of magnitude harder to fabricate than a static PDF.

Let Merchants Self-Serve the Verification Process

The OnDeck data on AI adoption tells us something important about merchant behavior: these business owners are comfortable with technology. They do not need someone to walk them through logging into their bank. What they need is a clear, well-designed workflow that tells them exactly what to show and confirms when they have done it correctly.

This is where AI-guided recording changes the game. Exact Balance's floating coach walks applicants through each step of their banking session, verifying completion in real time. The merchant opens their bank portal, navigates to the requested account view, scrolls through the specified date range, and the system confirms each step as complete. No phone call. No scheduling. No time zone coordination. The merchant records when it is convenient for them, whether that is 11 PM on a Sunday or 6 AM before the shop opens.

For underwriting teams, the downstream benefit is equally significant. Instead of reviewing notes from a live call, the underwriter watches a timestamped recording with a full activity log. Every action the applicant took is documented. Every page they visited is captured. This creates an audit trail that satisfies compliance requirements and provides defensible evidence if a deal is ever disputed.

Prioritize Cash Flow Trajectory Over Static Snapshots

Growth-oriented merchants present a specific challenge for underwriters who rely on static metrics. A business investing heavily in expansion might show lower average daily balances, higher outflows, or unusual transaction patterns that look like distress signals under traditional models. The key differentiator is whether those outflows are going toward revenue-generating activities or toward servicing existing debt obligations.

Effective verification in 2026 means capturing enough transaction history to distinguish between a merchant scaling up and a merchant spiraling down. Custom instructions within Exact Balance allow funders to specify exactly what date ranges, account views, and transaction types the applicant needs to display. Instead of a generic "show us your bank account" request, the underwriter can ask for 90 days of the primary operating account, any linked savings or reserve accounts, and specific transaction categories that reveal the merchant's capital allocation strategy.

This level of specificity transforms bank verification from a fraud check into a genuine underwriting tool. The recording does not just prove the account is real. It tells you how the business actually operates.

The Competitive Landscape Now Demands Async Workflows

SoFi's recent announcement of a $3 billion SMB lending commitment through BasePoint Capital signals that well-capitalized competitors are entering the small business funding space with fully digital, API-driven workflows. These entrants are not going to ask merchants to schedule phone calls. They are not going to email PDF request lists. They are going to fund applicants in hours, not days.

Independent MCA funders have advantages that these new entrants lack: flexibility on deal structure, appetite for riskier profiles, and deep broker relationships. But those advantages evaporate if the verification process adds two or three days to the funding timeline. A broker sending a deal to both a platform lender and an independent funder will close with whoever approves first. That is not a quality judgment. It is a speed judgment.

Asynchronous bank verification eliminates the single biggest source of delay in the independent funder's workflow. The applicant records their session on their schedule. The underwriter reviews on theirs. No calendar coordination. No missed calls. No rescheduling. The deal moves forward while everyone sleeps.

This is not about cutting corners. The video evidence captured through async recording is actually stronger than what a live call produces, because it is permanent, reviewable, and auditable. A live call leaves you with notes and memory. A recording leaves you with proof.

Frequently Asked Questions

How do AI-savvy merchants change MCA underwriting requirements?

Merchants who use AI tools generate cleaner, more structured financial data, which means underwriters can extract stronger signals from bank verification. These applicants also expect faster decisions, making asynchronous workflows essential for competitive close rates. Funders should update their verification processes to capture richer data and eliminate scheduling delays that drive applicants to faster competitors.

What are MCA underwriting best practices for growth-stage merchants?

Growth-stage merchants often show patterns that look like distress under legacy scoring, including higher outflows and lower average balances. Best practices include requesting 90 or more days of transaction history, specifying which account views and transaction categories the applicant must display, and analyzing cash flow trajectory rather than static balance snapshots. Exact Balance's custom instructions feature lets underwriters define these requirements precisely for each verification request.

Why is async bank verification faster than live calls for MCA lenders?

Live verification calls require coordinating schedules between the applicant and the underwriting team, often across time zones. Async verification removes this bottleneck entirely. The applicant records their banking session whenever it is convenient, and the underwriter reviews the recording on demand. This eliminates the one to three day scheduling delay that typically separates application submission from verification completion.

Can screen recordings catch bank portal manipulation that live calls miss?

Yes. Recorded banking sessions capture the full visual behavior of the portal, including page load dynamics, element rendering, and navigation transitions. AI analysis can compare these frame-by-frame against known patterns of legitimate banking interfaces, flagging developer-tools edits, screenshot overlays, or synthetic portal elements that a human reviewer on a live call would not notice in real time.

Conclusion

The OnDeck growth and AI adoption report is not just a data point about small business sentiment. It is a signal that the merchant base MCA funders serve is evolving faster than many underwriting workflows can accommodate. Growth-oriented, tech-fluent applicants expect speed, transparency, and professionalism from their funding partners. Funders who still rely on live verification calls and static document review are losing deals to competitors who have embraced asynchronous, AI-enhanced workflows.

Updating your MCA underwriting best practices starts with the verification step. Async screen recordings capture stronger evidence than live calls, eliminate scheduling delays, and produce audit trails that satisfy compliance requirements. Exact Balance delivers all of this in a browser-based platform purpose-built for Canadian and cross-border MCA lenders. Visit exactbalance.ca to see how async verification fits into your workflow.