Banxware’s Orchestration Layer: The Next Chapter in SME Financing

Background: The Challenges of the SME Financing Ecosystem

Over the past five years, Banxware has been at the forefront of shaping Embedded Lending in the German market. What began as an innovative idea has since become a new standard. Thousands of SMEs have already benefitted from solutions like Banxware Sofortfinanzierung and HVB FlexFinanzierung, gaining quick access to the capital they need to grow.

But this journey has also revealed something deeper. By working closely with SMEs, platforms, and banks, we uncovered structural challenges that go far beyond the lending process itself. These challenges shape the entire SME financing ecosystem and explain why, despite progress, too many businesses still struggle to get the right financing at the right time.

In the following, we take a closer look at these challenges for SMEs, platforms and banks.

1. SMEs: Barriers to Growth Remain

For SMEs, financing remains one of the greatest obstacles to growth. Traditional systems often underserve them, leaving too many businesses without the capital they need. Jens Röhrborn, Founder and CEO of Banxware, sums it up clearly:

“SMEs are the backbone of our economy. They create jobs, drive innovation, sustain supply chains. Yet, when it comes to financing, the system fails them.”

Despite significant progress in recent years, many SMEs still struggle to secure the financing they need. Access to capital remains fragmented, costs are often high, and existing products rarely reflect the diversity of business models and industries.

Alternative lenders have become more active on digital platforms, which has improved availability in some areas, but their offers often fail to fully match the needs of SMEs. In many cases, the financing is limited in scope, lacks flexibility, or comes at prices that are far less competitive than what banks could provide. As a result, growth ambitions are too often slowed, not because of lack of potential, but because the right financing option isn’t available at the right time.

At the same time, the mindset around financing is shifting. More and more SMEs are recognizing capital not as a last resort, but as a strategic tool. Recent data shows a 13% year-over-year increase in the use of external working capital solutions, and a 16% rise in businesses reporting that they use working capital strategically rather than only in emergencies.

This development is not limited to smaller companies. A recent VISA study found that even large and established enterprises are increasingly using financing as a lever for strategy, whether to accelerate innovation, strengthen competitiveness, or secure supply chains. For SMEs, who typically operate with tighter resources and thinner margins, this shift is even more critical. Flexible, accessible financing is no longer optional; it has become an essential enabler of growth.

2. Platforms: Struggling to Meet Diverse SME Needs

For platforms, the difficulty lies in managing the diversity of their customer base. They serve SMEs across multiple industries and company sizes, each with unique financing needs.

Relying on a single financing partner inevitably leaves gaps, while managing multiple providers quickly becomes too complex, too costly, and too far removed from their core business. In some cases, customers even leave platforms to find better-priced or more tailored offers elsewhere.

At the same time, offering financing has become an expected feature for platforms. SMEs increasingly look to the tools they already use, from accounting software to e-commerce platforms, to provide access to growth capital. When platforms meet this expectation, the benefits go beyond customer satisfaction: they strengthen loyalty, improve retention, and unlock new revenue streams. Financing is not only a value-add but a driver of long-term platform growth.

As Christian Steiger, CEO of Lexware, explains:

“Our accounting software platform supports 600.000 SMEs, of all sizes and industries. They all need financing to grow, but no single solution fits every case. Covering such a wide range with one financing partner is almost impossible and some customers even leave our platform to look elsewhere for more competitive loan fees.”

3. Banks: In Transition to the Digital Era

Banks, meanwhile, face a different set of challenges. They want to support SMEs with fast, digital products, but regulatory requirements and legacy IT systems make integration slow and resource-intensive. Even when suitable products exist, embedding them directly into SME workflows can be a major hurdle, preventing banks from delivering financing at the speed and convenience today’s businesses expect.

Adding to this is the issue of reach. SMEs increasingly expect financing to be available directly where they already work: on their platforms and within their digital tools. Few business owners visit a bank branch today, and this shift means banks need to go to their customers, not the other way around. For many banks, this is a structural challenge.

Operationally, SME lending is also difficult to scale. Margins in SME financing are often lower compared to corporate lending, while the cost of serving these customers remains high. Legacy systems make automation and digitization difficult, keeping processes manual, slow, and expensive. As a result, banks face the double burden of limited reach and high operating costs, which limits their ability to serve SMEs effectively.

As Martin Brinckmann, UniCredit/HVB, describes it:

“The needs of our SME customers are constantly changing. We want to offer them fast and digital solutions and support them with adapted financing products. Despite regulatory requirements and legacy systems, we must be able to quickly integrate these products into the daily workflows of SMEs. This is a complex process.”

These challenges reveal a clear gap. SMEs need fast, affordable, and accessible financing; platforms want to offer it without adding complexity; and banks are under pressure to modernize while struggling with legacy systems and cost structures. Each side of the ecosystem recognizes the importance of SME financing, but none can fully solve the problem on their own.

Solution: Building an Orchestration Layer

The Banxware Orchestration Layer can be thought of as the operating system of SME financing. It is not another point solution or a series of isolated integrations, but a central layer that connects capital providers and platforms into one coherent infrastructure.

As Joao Freitas, Chief Product Officer at Banxware, explains:

“Think of us as a central layer. We connect banks and lenders to platforms in a way that benefits everyone.

Just like an operating system coordinates the interaction between hardware and applications, the Orchestration Layer manages the flow between banks and lenders on one side, and platforms with their SME customers on the other. This ensures financing is delivered efficiently, securely, and seamlessly where it is needed most: inside the platforms SMEs already use to run their businesses.

Capital Providers <-> Orchestration Layer

For capital providers, that means banks and alternative lenders, the Orchestration Layer serves as the single point of entry into embedded finance. Instead of managing multiple costly integrations with individual platforms, they connect once to Banxwares Orchestrational Layer. From there, their financing products can be distributed across an entire network of platforms without additional effort.

This connection goes far beyond APIs. The Orchestration Layer embeds essential processes that capital providers rely on: 

In effect, the Orchestration Layer translates a bank’s existing financing products into a fully digitized, embedded experience, making competitive bank pricing available at fintech speed.

Platforms <-> Orchestration Layer

On the other side, the Orchestration Layer provides platforms with a ready-made financing engine. By integrating a single API, platforms gain access to a curated pool of banks and alternative lenders, each with different strengths, risk appetites, and product types.

For platforms, this eliminates the need to manage multiple contracts, integrations, or reporting structures. Banxware orchestrates all of this complexity behind the scenes. At the same time, redundancy is built in: if one lender temporarily steps back, others ensure that financing remains “always-on.”

Most importantly, financing becomes a natural part of the platform experience. SMEs access it directly in the tools they already use, whether for accounting, payments, or e-commerce, under the platform’s brand and with minimal friction. Instead of navigating fragmented offers or overpriced alternatives, SMEs see financing that fits their needs, delivered at the right time and place.

The Orchestration Advantage

By positioning itself at the center, the Orchestration Layer enables each player to focus on what they do best:

1. Banks and lenders provide capital at scale, without the technical and operational burdens of individual integrations.

2. Platforms expand their value proposition with embedded financing, without leaving their core business.

3. SMEs benefit from accessible, competitive, and seamless financing through the platforms they already trust.

From the platform perspective, the benefit is obvious. As Christian Steiger from Lexware explains:

“Through Banxware’s Orchestration Layer, I can offer my customers multiple financing options from different capital providers, covering more needs across all industries and company sizes, without building it all myself and… with just one contract in place. That also means I can offer more competitive loan fees due to the integration of banks, turning my platform into a true growth partner for SMEs, and rewarded with stronger loyalty from my customers.”

Banks recognize the value as well. Martin Brinckmann of UniCredit/HVB highlights:

“Banxware opens access to untapped market potential with prequalified SMEs. They handle the technical integration and initial risk assessments, while also digitizing the financing offer end-to-end, enabling faster applications and a modern user experience. It’s the best of both worlds: We provide the capital, and Banxware delivers the digital infrastructure, speed, and reach.”

Taken together, these perspectives show why orchestration is more than just the next step, it is the infrastructure that transforms SME financing from a fragmented market into a connected ecosystem that works for everyone.

As Jens Röhrborn concludes:

“It’s a true win-win-win: banks scale their reach, platforms grow their value, and SMEs get the financing they need to grow, right where they work.”

Conclusion

From the beginning, Banxware’s mission has been to empower businesses through better access to financing. That mission continues today, but with an expanded focus: orchestration. By connecting banks, platforms, and their SME customers in one orchestrated infrastructure, Banxware makes financing simple, scalable, and beneficial for everyone involved.

At the same time, lending will always remain part of Banxware’s DNA. Our own lending activity is essential for conducting risk pre-checks, understanding SME behavior in real time, and continuously improving the orchestration layer. It ensures that our technology is grounded in practical market experience, enabling us to design solutions that truly reflect the needs of both capital providers and platforms.

In this way, Banxware combines two strengths: the hands-on expertise of a lender and the innovative infrastructure of an orchestrator. Together, they form the foundation for the future of SME financing.