2025/26
Welcome
An introduction to this year's report
Impact
What intermediary-led finance delivers
Landscape
The economic backdrop shaping SME finance
Appetite
Understanding who wants to borrow
Intermediaries
Who brokers are and how they work
Pathfinders
The National Association of Commercial Finance Brokers (NACFB) is the largest independent trade body for commercial finance brokers. The Association exists to support, represent, and set standards for brokers who help small and medium-sized businesses access finance.
Founded in 1992, at a time when business lending was becoming more complex and small firms were increasingly relying upon intermediaries to navigate their options, the NACFB was created to bring structure, credibility and professionalism to the broker market. From the outset, the Association’s purpose has been clear: to champion a trusted and professional intermediary market, strengthening the broker-led finance ecosystem to improve outcomes for businesses seeking finance.
Today the trade body is bigger than it has ever been and represents a broad and diverse membership, spanning asset finance, property finance, business loans, invoice finance and specialist funding solutions. Whilst the products may differ, our Members are united by a shared commitment to helping viable businesses access the funding they need to start, grow and adapt.
At the heart of the NACFB is a focus on standards and confidence. Through our Assurance programme, the Association promotes good practice, transparency and professionalism, while working closely with regulators, policymakers and industry partners to ensure the intermediary voice is understood and reflected in decision-making. Our role is not only to respond to change, but to help shape a market that works better for brokers, lenders and the businesses they serve.
The NACFB also supports Members in practical ways, providing compliance guidance, education, data and insight, events, and opportunities to connect with lenders and peers. Through advocacy and collaboration, we champion the value of intermediaries in improving access to finance and delivering better outcomes for SMEs across the UK.
In simple terms, the NACFB exists to support brokers, raise standards, and strengthen a trusted, broker-led finance ecosystem that works for small businesses – today and in the future.
2026 Sponsors
Every day, thousands of small businesses across the UK rely on brokers to help them make sense of an increasingly complex funding landscape – to find the right finance, from the right lender, at the right time.
That role has never been more important. The intermediary market has reached a point of real maturity, with brokers now firmly established as a central part of how the UK economy functions, connecting businesses to capital, expertise and opportunity at every stage of growth.
The Connected Economy reflects that shift. This year’s NACFB Intermediary Market Outlook brings together a fully integrated view of broker and lender perspectives, underpinned by robust data and insight from across our membership. For the first time, it also draws more extensively on external data sources and industry partners – not only to contextualise our own findings, but to provide a broader platform for the voices, evidence and insights shaping the SME finance landscape.
The timing is significant. Over the past year, the role of the NACFB has been formally recognised by Government as a key voice within the intermediary market. At the same time, expectations of brokers and lenders continue to rise, as businesses navigate a more complex economic environment and seek trusted guidance alongside funding. Against that backdrop,
the need for clear, credible and independent market insight has never been greater.
This report also signals a broader shift in how the NACFB approaches its role. We are forging a more confident, data-backed path for the organisation – one that strengthens our ability to inform policy, support standards, and represent the intermediary market with authority. The structure of the report reflects that ambition, moving from the wider economic landscape, through broker activity and lender behaviour, and towards the practical implications for the future of SME finance.
Crucially, we see the NACFB as an industry integrator. Our impact extends beyond our broker and lender membership to include trade bodies, regulators, policymakers and delivery partners across the funding ecosystem. We are committed to working more closely with those stakeholders on future data projects and shared insight that can benefit the market.
Ultimately, this report reinforces why the NACFB exists: to champion a trusted and professional intermediary market, strengthening the broker-led finance ecosystem so that businesses across the UK can access the funding, support and confidence they need to grow.
But it is also a call to engage. The intermediary market now sits at the heart of SME finance in the UK, and the NACFB occupies a unique position within it – as a convener of expertise, a guardian of standards, and a bridge between brokers, lenders, policymakers and the wider funding community. We encourage stakeholders across the industry to engage with the trade body and its Members, to recognise the role intermediaries play in driving economic growth, and to work with us in shaping a more connected, transparent and effective finance ecosystem for the years ahead.
Jim Higginbotham CEO NACFB
What intermediary-led finance delivers
Impact seeks to ground the data into the real economy. This early chapter distils the combined insights of brokers, lenders and businesses to show the tangible role the intermediary market plays across the UK. It sets out, at a high level, how the activity of NACFB Members translates into real-world outcomes – supporting small businesses, enabling investment, sustaining employment and unlocking growth in every region.
More than a snapshot of market behaviour, this section serves as a lens on economic contribution. It connects insight to outcome, showing how intermediary-led finance functions as critical infrastructure within the SME economy. This is a chapter about tangible meaning as much as measurement.
£33 billion
In 2025, NACFB Members helped UK businesses secure more than £33 billion in finance, representing a 25% increase on 2024.
180,000 loans arranged for UK businesses
Across the year, around 180,000 loans were arranged by NACFB Members on behalf of their clients.
Based on established economic assumptions, the finance facilitated by NACFB Members is estimated to have supported the creation of 185,000 additional jobs during 2025.
£12bn in direct GVA generated
The lending activity supported by NACFB Members is estimated to have generated £12 billion in direct gross value added (GVA) in 2025. Direct GVA provides a clear measure of how intermediary activity feeds into national economic output.
£19.2bn total GVA when wider impacts are included
When indirect and induced effects are taken into account, total GVA linked to intermediary-led lending rises to £19.2 billion. This reflects the wider supply-chain activity and consumer spending generated as financed businesses grow.
Using lender-panel extrapolation, total SME lending facilitated by brokers across the UK in 2025 is estimated at approximately £50bn
Property-led finance accounted for 113,000 transactions, with an average deal size of £222,000, compared with 38,000 asset finance deals (£111,000) and 32,000 business finance deals (£122,000)
Across most UK regions, property-backed lending represents between 60% and 85% of brokered lending by value, rising to 85% in Greater London.
Northern Ireland shows the most diversified lending profile, with respondents reporting lending split evenly between property (40%), asset finance (40%) and business finance (20%).
Nearly two-thirds (62%) of SME lending facilitated by NACFB Members in 2025 was delivered outside Greater London and the South East.
44% of broker-supported clients in 2025 were reported as new-to-firm, indicating continued onboarding of first-time or newly active borrowers.
Over 80% of broker-supported businesses were reported to turn over less than £5 million, and 50% employ fewer than 10 people, reinforcing the intermediary role at the core of the SME economy.
36% of brokers reported writing larger average deal sizes in 2025, compared with 9% reporting smaller deal sizes, suggesting gradual ticket-size expansion.
66% of brokers reported winning business from returning clients, 60% from client referrals, and 44% from professional introducers, highlighting the relationship-led nature of the market.
Brokers reported considering an average of six lenders per deal, with 26% saying clients had been declined elsewhere before approaching them, evidencing the intermediary’s role in deal rescue and restructuring.
This chapter sets the scene for everything that follows. It takes a fully zoomed-out view of the UK’s business environment, drawing on trusted third-party data to explore the size, shape and distribution of enterprise across the economy. By starting at the macro level, this section provides
the broader context within which all lending activity sits – from business formation and growth, to regional patterns and sectoral trends. It establishes the economic backdrop against which brokers and lenders operate and creates the foundation for understanding how finance flows through the system.
5.64 million businesses were small (0 to 49 employees)
38,435 businesses were medium-sized (50 to 249 employees)
8,335 businesses were large (250 or more employees)
This data gives a clear sense of the overall size of the opportunity for the intermediary market. With 5.7 million private sector businesses operating in the UK at the start of 2025, and a further 191,000 businesses added over the past year alone, the addressable market continues to expand.
Crucially, this growth is concentrated almost entirely among smaller firms, reinforcing that the core of broker activity and lender engagement is likely to remain focused on micro and SME businesses, which make up the overwhelming majority of the UK business population.
Source: DBT, Business Population Estimates 2025
)
1.4 million (25%) businesses had employees and 4.3 million (75%) did not employ anyone aside from the owners
Total employment in SMEs was 16.9 million (60% of the total), while turnover was estimated at £2.8 trillion (51%)
This regional breakdown reinforces just how unevenly business activity is distributed across the UK. London and the South East stand out as clear economic centres, together accounting for 34% of all private sector businesses, which helps explain why these regions continue to attract a disproportionate share of investment, talent and financial services activity.
At the same time, the data also highlights the very different operating contexts across the UK nations and regions. With around five million businesses
Source: DBT, Business Population Estimates 2025
based in England, compared with 361,000 in Scotland, 194,000 in Wales and 139,000 in Northern Ireland, the scale of local markets varies significantly. Importantly, these figures are based on head office location, meaning regional counts reflect where strategic decision-making sits rather than where firms may physically operate. For brokers and lenders, this underlines the need for regionally nuanced approaches, with opportunities shaped not just by demand, but by how and where businesses are structurally anchored.
This more sectoral view, further drawn from the government’s latest Business Population Estimates for 2025, shows just how broad and diversified the UK business base has become, with activity spread across a wide range of industries rather than concentrated in any single sector. Construction and Professional, Scientific and Technical Activities stand out as two of the largest sectors by business count, highlighting the continued importance of project-led work and advisory-driven firms within the SME economy. Wholesale and Retail remains the dominant sector by both employment and turnover, underlining its central role in day-to-day trading activity and working capital demand.
Looking at recent change adds a more practical lens. Professional, Scientific and Technical Activities recorded the largest numeric increase in business numbers, pointing to a growing pipeline of consultancy,
Source: DBT, Business Population Estimates 2025
tech and specialist service firms that may require relatively light-touch but repeat finance. Human Health and Social Work saw the fastest percentage growth, suggesting rising demand in sectors often linked to longer-term contracts and public or quasi-public funding. By contrast, declines in Administrative and Support Services, Manufacturing and Transportation indicate pressure in more operational sectors where cost, margins and cashflow are perhaps more likely to be under strain.
For brokers, this implies a shifting opportunity set: increasing volumes in professional services and construction, where speed, flexibility and relationshipled advice will matter most, alongside a need for more careful structuring and risk management in logistics, manufacturing and support services, where businesses may be seeking finance to stabilise rather than expand.
Richard West CEO Red Flag Alert
This section draws on proprietary business data provided by Red Flag Alert, commissioned by the NACFB specifically for this report. The analysis uses Red Flag Alert’s Growth Score methodology to identify patterns of business growth across the UK SME population, combining financial performance indicators, behavioural signals and structural business data to assess which firms are most likely to expand.
Rather than relying on historic outcomes alone, the Growth Score provides a forward-looking view of business potential, allowing emerging trends to be explored by sector, region and firm size. This makes it particularly useful for understanding where momentum is building within the SME economy, and where risks or early warning signs may also be present.
The data is designed to support market-level insight rather than firm-level targeting.
5% of UK businesses are very likely to grow by 20%
Source: Red Flag Alert Growth Score –January 2026
It offers an independent, evidence-based lens on how growth is distributed across the UK, highlighting differences in regional performance, sectoral strength and the varying prospects of micro, small and medium-sized businesses. Taken together, the findings provide a practical complement to the survey-based evidence elsewhere in this report, helping to translate sentiment into measurable growth signals across the real economy.
The Growth Score is a predictive indicator used to assess the likelihood that a business will achieve significant growth over the next 12 months. It draws on a combination of financial performance data, structural business changes and behavioural signals to identify firms showing credible momentum. Businesses rated as “very likely to grow” have a strong probability of delivering material expansion, with around 98% of those flagged as likely to grow by 20% or more typically achieving this outcome.
Reduced growth potential in some sectors
• Real estate activities
• Accommodation and food service activities
47,301 businesses with simultaneous high growth and early distress signals
• Up from 46,000 in January 2025
• Down from 60,000 in January 2024
The Growth Score shows that 16% of UK small businesses are forecast to grow over the year ahead. For clarity, this reflects only the proportion of firms that are likely to expand – not the whole SME population –making it a useful indicator of where momentum is building.
Northern Ireland leads the UK, with nearly 18% of firms expecting growth, followed by Scotland and London. Most English regions cluster between 15% and 16%, pointing to a steady but fragile recovery rather than one driven by a single hotspot.
For brokers and lenders, these regional differences matter. Areas with higher growth intent tend to generate more demand for investment, working capital and structured funding, while flatter regions may see more refinancing and cashflow-led need. Because the Growth Score is applied across all UK small businesses to track real activity and trends, it offers a practical way to spot where future SME finance demand is most likely to emerge.
The Growth Score shows clear differences in momentum across sectors, with energy, resources and financial services leading the way. Electricity, gas and air-conditioning tops the table, driven by investment in renewables, grid upgrades and energy-efficiency projects such as solar farms, battery storage and heatpump installations. Mining and quarrying is also strong, reflecting demand for materials used in infrastructure and the energy transition.
More cost-pressured sectors such as construction, hospitality and leisure show weaker growth intent. For brokers, this points to a split market: high-growth sectors will drive demand for asset, project and working capital finance, while slower-growth industries are more likely to need refinancing and cashflow support.
1.9. Which business sizes are most likely to grow?
Business size distribution by growth likelihood
Forecast growth Not forecast to grow
The above pattern is expected, as medium-sized firms are more likely to be in an active expansion phase – having likely already built the scale, systems and funding relationships needed to turn ambition into real investment and growth.
Appetite shifts the focus from the market as a whole to the businesses within it. This chapter looks at those enterprises actively seeking finance, using external data to explore borrowing demand, readiness and confidence. It helps contextualise why businesses turn
to funding, what they are using finance for, and how their needs are evolving in response to economic conditions. By grounding the report in real borrower behaviour, this section connects the wider economy to the lived experience of SMEs navigating growth, change and uncertainty.
Ian Coulson Head of Commercial Brokerage HSBC UK
UK businesses are entering 2026 with a renewed sense of ambition and determination. Despite ongoing economic uncertainty, many are adopting a pragmatic “push on through” mindset, treating volatility as something to manage rather than a barrier to growth. Rather than pausing investment, a growing number of firms are focusing on how to adapt, build resilience and position themselves for the next phase of expansion.
Investment intentions remain high, particularly among growth-focused companies. Productivity gains and technology investments – especially in areas such as automation and AI – are emerging as key priorities, reflecting a desire to work smarter, improve efficiency and stay competitive in tighter markets. For many firms, this is less about short-term returns and more about long-term capability building.
At the same time, many businesses continue to rely on familiar, traditional finance products, even as their needs become more complex. This suggests there is still significant untapped potential in more flexible, bespoke funding solutions that better reflect how modern businesses operate, from irregular cashflows to project-based or scaling models.
Sustainable finance is also becoming increasingly relevant as the transition to net zero gathers pace. While awareness is improving, accessibility and understanding remain barriers for many businesses, indicating a need for clearer guidance and more practical support in aligning growth ambitions with sustainability goals.
Across all of this, one constant remains the value of trusted relationships. In an increasingly complex financial landscape, businesses are seeking expert advice to help them make informed decisions, structure funding appropriately and navigate uncertainty with confidence. The role of intermediaries, as trusted partners and interpreters of the market, is therefore becoming more important, not less, in shaping how businesses grow in the years ahead.
86% of growth-focused companies plan to invest significantly in the next 12 months
95% of businesses aiming for significant growth plan to make major investments in the next 12 months
22% of businesses are pursuing significant growth over the next one to two years, rising to 28% among corporates
45% of businesses are aiming for steady growth over the next one to two years
86% of growth-oriented firms expect to invest significantly in the next 12 months, with London leading on growth ambitions
84% of growth-focused businesses are comfortable borrowing to grow
36% of growth businesses have considered a government support scheme, rising to 43% among growth-focused corporates
72% of companies who view tech investments as important plan to prioritise AI
63% of growth companies favour their main bank for borrowing
of manufacturing firms are using invoice financing, the highest of any sector
37% of businesses would consider using sustainability-linked loans or green loans, but only 19% are familiar with them
Shiona Davies Director Ipsos
This section draws on the latest published findings from the SME Finance Monitor, and reflects the mid-year 2025 position for UK small and medium-sized businesses. The SME Finance Monitor remains one of the most comprehensive and long-running studies of business finance in the UK, providing a consistent, independent view of how SMEs are performing, how they feel about the future, and how they are engaging with finance.
The data offers a timely snapshot of a business community that is broadly resilient, but operating in an environment shaped by persistent uncertainty. While profitability levels have largely returned to pre-pandemic norms for many firms, a significant minority continue to feel under pressure, with rising costs, economic conditions and political uncertainty
22% of SMEs described themselves as Struggling (revenue falling short of outgoings)
35% of SMEs reported an injection of personal funds, typically because they felt they had to
all cited as key barriers. Confidence in the future remains mixed, with businesses divided between those still actively pursuing growth and those adopting a more cautious, defensive stance.
From a finance perspective, the picture is equally nuanced. Use of external finance remains stable, with a large proportion of SMEs continuing to rely on familiar products and a sizeable group identifying as permanent non-borrowers. With general concerns about affordability, access and potential application success, appetite for finance remains limited. There is an increasing divide in success rates between applicants with fewer than 10 employees, where around half are successful, and larger SMEs where over eight in 10 are successful.
Taken together, the mid-year 2025 data highlights a market characterised less by sharp shifts and more by steady underlying trends: cautious optimism, selective ambition, and a continued need for trusted advice as businesses navigate a complex and evolving financial landscape.
reported making a profit, broadly back to pre-pandemic levels
35% rated higher costs as a key barrier
31% saw the economic climate as a key barrier
held more than £10,000 in credit balances, but over half had less than £5,000
31% saw political uncertainty as a key barrier
As many SMEs felt the future offered mainly threats ( ) as felt it offered mainly opportunities ( ) 30% 32%
57% of SMEs had either been innovative or planned to be
28% of SMEs had grown in the past 12 months, still below pre-pandemic levels
45% of SMEs planned to grow
25% met the definition of an Ambitious Innovator
44% of SMEs were using external finance
38% of SMEs were happy to borrow to grow
13% of SMEs reported any borrowing event in the past year
1 in 5 SMEs grew in the past year and plan to grow again
31% were Ambitious Risk Takers
49% of applications were successful, increasing to eight in 10 or more of those with 10-249 employees
38% met the definition of a Permanent non-borrower with little interest in external finance 10% expected to apply for finance in coming months
16% of finance users were worried about repayment
6 in 10 SMEs said the future felt uncertain and they were being cautious
45% were confident a future application would be successful
This section draws on a bespoke survey of Federation of Small Businesses (FSB) members, conducted in December 2025 and commissioned by the NACFB specifically for this report. The survey captured responses from around 250 small business owners and decision-makers, focusing on their awareness, perceptions and experiences of commercial finance brokers.
While the sample size is more limited than some of the national data sets used elsewhere in this report, the findings provide a valuable qualitative lens into how small businesses currently view the broker market, including levels
of familiarity, perceived value, and barriers to engagement. The data should therefore be interpreted as indicative of sentiment among FSB members, rather than a fully representative picture of the wider SME population.
This marks the first time the NACFB has partnered with the FSB on dedicated research of this kind. The Association sees this as an important starting point for deeper collaboration in the future, helping to better understand small business attitudes to intermediary-led finance and to identify where awareness, education and trust can be strengthened across the market.
The data suggests that direct experience of commercial finance brokers remains relatively limited among FSB members, with fewer than one in nine businesses reporting that they have used a broker in the past three years. Importantly, this group includes businesses that would not seek external finance through any route, rather than reflecting a wholesale rejection of the intermediary channel.
Nonetheless, the findings point to a broader awareness and engagement gap within the small business community, highlighting an opportunity for improved education, visibility and clearer articulation of the broker value proposition for those businesses that do engage with finance markets.
Source: Federation of Small Businesses survey - SBI Q4 2025
Access to a wider range of lenders or finance options
Trust in their advice and guidance
To save time or reduce administrative burden
Specialist expertise or sector knowledge
Better outcomes (e.g. rates, structure, or fit for our needs)
Recommendation from a peer or professional adviser
I was declined by a lender and wanted alternatives
Source: Federation of Small Businesses survey - SBI Q4 2025
The data suggests that brokers are primarily valued for their ability to broaden access and simplify the finance journey, rather than as a last resort following rejection. The strongest drivers relate to choice, trust and efficiency, indicating that businesses see brokers as proactive partners who add value through market access and practical support, rather than purely as intermediaries for problem cases.
2.5. How important are different factors when choosing a commercial finance broker?
Track record, credentials, and reputation
Personal recommendation or referral
Quality of advice and guidance provided
Confidence in the broker managing the process
Acting impartially and working in my businesses’ best interests
The findings point to a clear hierarchy in what SMEs value most when choosing to work with a commercial finance broker, with trust, competence and advocacy outweighing purely transactional considerations. The strongest signals cluster around confidence in the broker’s ability to manage the process, understanding complex or specific business circumstances, and acting impartially in the client’s best interests, suggesting that
Source:
businesses are primarily seeking reassurance, expertise and aligned advice in a complex funding environment. While track record, reputation and referrals remain important, they appear to function more as entry points, with the real differentiators being quality of advice, transparency and the broker’s ability to simplify decision-making and guide clients through unfamiliar territory.
Most FSB members still view brokers as a one-off facilitator, but nearly one in three already see them as a long-term adviser. This highlights a clear opportunity for brokers to shift from transactional relationships towards more sustained, advisory partnerships.
A one-off facilitator (used for a single transaction) 56%
Not sure / too early to say
A long-term adviser (ongoing relationship or repeat use) 30%
Source:
We’ve never considered using a broker
We considered, but decided not to use a broker
sure
Source: Federation of Small Businesses survey - SBI Q4 2025
We don’t currently use or need external finance
We arrange finance directly with banks or lenders
Concerned about broker fees or costs
Prefer to rely on our accountant or adviser
We weren’t aware of what brokers do
Unsure how to find a trustworthy broker
Concerned about impartiality or transparency
FSB members shared that the clear and dominant reason for not using a broker is lack of immediate demand, with over seven in 10 businesses saying they simply do not currently require external finance. Beyond this, the most common alternatives are arranging finance directly with lenders or relying on existing professional advisers, such as accountants. Notably, issues of trust and transparency are relatively minor, whilst awareness remains low, suggesting that the main barriers are perceived relevance and visibility, rather than negative perceptions of the broker role itself.
Among businesses that have not previously used a broker, clear intent remains limited, with only around 13% saying they are likely to consider one in the future. However, the largest group by far is those who are unsure, suggesting that attitudes are not firmly set and that there
is a substantial persuadable middle. This indicates that future growth in broker usage is more likely to come from improving awareness and understanding of the broker role, rather than trying to convert businesses that are already firmly resistant.
Even among businesses that have not previously used a broker, trust and transparency are overwhelmingly seen as critical factors, with over nine in 10 rating them as important or extremely important.
This indicates that whilst awareness and usage of brokers may be low, expectations around professional standards are very high.
Source:
Intermediaries introduces the first of the NACFB’s proprietary insight, combining internal membership data with findings from the 2025 broker survey. This chapter focuses on the who, what, where and when of the broker community – exploring firm profiles,
regional spread, product mix and business models. It provides a detailed picture of the intermediary market itself, offering a clear sense of who today’s brokers are, how they operate, and how the sector continues to evolve.
As of December 2025, the NACFB represents 1,400 broker firms, comprising more than 3,000 individual registered brokers – the largest membership base in the Association’s history. This milestone reflects both the continued growth of the intermediary market and the NACFB’s role as its leading professional body.
For the first time, the Association has been able to combine its internal CRM data with external
Source: mnAi analysis of NACFB CRM data - December 2025
Source: mnAi analysis of NACFB CRM data - December 2025
company-level intelligence to build a detailed demographic profile of its membership. Using verified company identifiers, we can now accurately map the structure, scale and characteristics of NACFB firms, providing a clearer picture of who our brokers are and how the sector is evolving. This analysis has been enabled through a partnership with mnAi, whose data capabilities have allowed us to explore firm composition, size and emerging trends across the membership base.
10
2
49
Source: mnAi analysis of NACFB CRM data - December 2025
Taken together, the data shows a broker community that is well-established, owner-led and professionally mature. The typical NACFB firm is around a decade old, led by a small leadership team of two directors, with an average director age of 49. Leadership is predominantly drawn from Generation X and Millennials, reflecting a balance of experience and mid-career dynamism rather than early-stage start-ups.
The membership remains largely male-led, though a meaningful proportion of firms are either female-led or gender-balanced, signalling gradual diversification in leadership structures. While most Member firms are not ethnic-led, a significant minority are, underlining the breadth of backgrounds represented across the NACFB community. Overall, the profile is of a stable, experienced broker base with growing diversity and long-term roots in the SME finance market.
The NACFB membership remains dominated by small, independent firms, with just over half operating as single-broker businesses. However, there has been a slight year-on-year contraction in one-person firms, alongside growth in multi-broker practices. While larger firms remain a minority, they increasingly include broker networks and more structured teams, pointing to a gradual shift towards scale, collaboration and more resilient business models across the intermediary market.
Source: NACFB CRM data - December 2025
Scope note: This analysis reflects NACFB Member firms only and shows both the primary business finance products brokers operate in and their regulatory status (Directly Authorised, Appointed Representative, or non-regulated).
Source: NACFB CRM data - December 2025
The data highlights clear differences in how brokers operate across product types. Property-led finance dominates the membership, and is strongly associated with directly authorised firms, reflecting the regulatory complexity and specialist expertise typically required in this market. Asset finance, while smaller in overall share, shows a much higher concentration of Appointed Representatives, underlining the role of networks in supporting scale, compliance and distribution in this
segment. Business finance lending generally operates with a more mixed regulatory profile and a notable presence of non-regulated activity, reflecting the diversity of products and routes to market in this space. Taken together, the figures suggest that regulatory structure closely tracks product complexity, with brokers aligning their operating model to the demands of each finance discipline.
These heatmaps illustrate where NACFB Member firms specialising in broadly property-led, asset and business finance are physically located across the UK. As expected, broker density is highest in areas with larger SME populations and established commercial centres, particularly across London, the South East, the Midlands and major regional cities. However, location alone does not define reach.
A significant proportion of NACFB brokers operate nationally, serving clients well beyond their immediate geography through digital channels, introducer networks and lender relationships. As a result, strong regional coverage should be understood as a reflection of access and availability, rather than a constraint on the scope of advice or lending supported. For SMEs, this reinforces the value of broker expertise and connectivity over proximity, whilst still underlining the importance of a nationwide intermediary footprint.
Source: NACFB CRM data - December 2025
Source: mnAi analysis of NACFB CRM data - December 2025
The SIC code profile of NACFB Member firms highlights the difficulty of neatly defining what a commercial finance broker is in practice. Whilst the majority of firms are classified under financial services, a significant minority sit across professional, technical, administrative and wider service categories, reflecting the fact that broking is often one part of a broader advisory or commercial offering rather than a standalone activity. This underlines the limitations of relying on SIC codes alone to size or map the UK broker market, as classification frequently reflects historic or administrative choices rather than day-to-day activity.
This ambiguity presents a wider challenge for policymakers and analysts seeking to quantify the role of intermediaries in SME finance. Despite these definitional constraints, the NACFB estimates that around 60% of the value of SME finance introduced via brokers flows through NACFB Members. This estimate is informed by lender feedback on the composition of their broker panels, providing a practical, market-led indicator of the Association’s reach and influence within the intermediary-led lending ecosystem.
Source: NACFB broker survey - November 2025
38% Diversified/added products (added more products and services)
13% Refined/focused (focused on fewer, more specialised offerings) Stayed broadly the same
Source: NACFB broker survey - November 2025
Taken together, these findings point to a broker community that is largely stable but actively repositioning for the next phase of growth. Whilst only a minority of firms describe themselves as being in outright expansion mode, the overwhelming majority report either steady growth or a broadly flat position, with contraction remaining rare.
This stability is also reflected in how brokers are evolving their product offerings. Nearly half (49%) report that their proposition has stayed broadly the same, while 38% have diversified or added new products and services, and a further 13% have deliberately refined and specialised their focus.
Taken together, this suggests a market that is not standing still, but adapting in measured and intentional ways. Brokers appear to be balancing continuity with selective change – broadening capability where client demand requires it, or sharpening focus around areas of expertise – pointing to a sector responding strategically to market conditions rather than pursuing rapid or reactive expansion.
In 2025, NACFB Member brokers originated £33 billion of SME lending, representing a 25% increase on the previous year and highlighting the growing scale of intermediary-led finance. This expansion is reflected at firm level too, with 59% of brokers reporting that they originated more business in 2025 than in 2024. Based on lender feedback, the NACFB estimates that
its Members account for around two thirds of the total value of SME finance originated via the entire commercial finance broker community, not just within the Association. On this basis, the total volume of SME lending facilitated by commercial finance brokers across the UK in 2025 is projected to be around £50 billion.
3.12. NACFB broker activity in 2025 – at a glance Property-led finance 113,000 £222,000
Approx. total transactions (#) Average sized transaction (£)
These figures reflect activity within the NACFB broker community only, which in its current form skews towards property-led finance. This is reflected in both scale and value, with 113,000 property-led transactions and an average loan size of £222,000, compared with 38,000 asset finance deals averaging £111,000 and 32,000 business finance transactions averaging £122,000. The average loan sizes and
Source: NACFB broker survey - November 2025
number of transactions shown here are broadly indicative rather than definitive. While NACFB data coverage is substantial, producing more precise and granular averages would require a co-ordinated, cross-industry approach to transactional data, bringing lenders and trade bodies together to create a more complete and consistent single source of truth.
Source: NACFB broker survey - November 2025
Across almost every UK region, property-led finance dominates the value of broker-arranged lending, typically accounting for 60-85% of total volumes. As you would expect, this is most pronounced in Greater London (85%), the South West (82%), the North East (82%) and the South East (80%), reinforcing the structural importance of property-backed borrowing to SME finance demand in both metropolitan and regional markets. Even in traditionally more industrial or mixed economies such as the West Midlands (71%), North West (71%) and East of England (70%), property remains the primary driver of lending by value.
However, the data also reveals important pockets of diversification. Scotland (60% property) and the East Midlands (60%) show a more balanced mix, with asset and business finance together accounting for around 40% of total value. Northern Ireland stands out as the
most diversified market, with property representing only 40% of lending, matched by a striking 40% in asset finance and 20% in business lending – a profile far closer to an equipment- and working-capitalled economy. Asset finance also plays a stronger role in Scotland (26%), the East Midlands (22%) and International jurisdictions (24%), suggesting a higher prevalence of trading, manufacturing or capital-intensive clients served.
Overall, while the NACFB community remains structurally property-led by value, these regional contrasts underline that broker activity is not monolithic. In several parts of the UK, particularly outside the South East and London, brokers are supporting a materially broader set of SME funding needs, highlighting both the diversity of the intermediary market and the importance of region-specific finance strategies.
180,000
Source: NACFB broker surveyNovember 2025
During 2025, NACFB Members served an estimated 180,000 clients, with new-to-firm clients representing around 44% of this total (80,000 businesses). This level of new engagement underlines the intermediary market’s role in attracting and supporting first-time and growing borrowers.
last year?
Source: NACFB broker surveyNovember 2025
The data suggests that deal sizes have broadly stabilised, with over half of brokers reporting that their average loan size in 2025 was unchanged from 2024, but a much larger share saw increases than declines.
The data shows that most NACFB brokers are supporting genuinely small trading businesses, with over half of funded clients turning over less than £1 million a year. These are not start-ups, but established micro and small
firms that are cash-flow sensitive, often asset-light, and particularly reliant on external finance to invest, smooth volatility and manage growth – making brokerled advice especially valuable at this end of the market.
Source: NACFB broker survey - November 2025
Returning
Direct
Events/networking
Other
Lender
Source: NACFB broker survey - November 2025
The pattern here is quite striking: the dominant sources of new business are human, not digital. Returning customers (66%), client referrals (60%) and professional introducers such as accountants and solicitors (44%) all rely on trust built through experience and personal credibility, rather than cold outreach. Even where new clients are involved, they typically arrive via someone else’s recommendation rather than direct marketing.
By contrast, purely transactional or broadcast channels are marginal – social media, SEO, telemarketing and even lender referrals all sit in single digits. This tells us that commercial finance broking is still fundamentally a relationship-led profession, where reputation, track record and network effects matter far more than advertising spend. In practical terms, brokers grow not by shouting louder, but by doing good work and being remembered for it.
Accommodation and food services (e.g. hotels, restaurants)
Broker engagement across sectors highlights a market shaped by both concentration and caution. Property and real estate activity continues to dominate enquiries, reinforcing the central role of property-backed finance within the intermediary market, even as brokers work across an increasingly diverse range of sectors.
Construction and manufacturing show sustained demand alongside higher expectations of slowdown
Source: NACFB broker survey - November 2025
and reluctance, pointing to a more cautious outlook in capital-intensive industries. By contrast, sectors such as transport and logistics, wholesale and retail, and information and communication appear relatively stable, with steady levels of engagement but limited signals of accelerated growth.
Accommodation and food services stands out for elevated reluctance, suggesting ongoing fragility despite continued finance needs.
Pathfinders moves beyond the basics to explore how brokers add value in practice. Using exclusive NACFB data, this chapter looks at the how and the why of intermediary activity – from lender engagement and client relationships, to advisory models and decision-making.
It highlights the role brokers play as navigators within a complex funding environment, helping businesses find suitable solutions and guiding them through increasingly varied finance journeys. This section brings the intermediary role to life.
Transactional (%) e.g. one-off placements or deal-focused work
Ongoing/relationship-led (%) e.g. repeat clients, ongoing support, or portfolio advice
What this shows is that broking is far more than a series of one-off transactions. While a significant share of deals are still done on a single-case basis, most activity now sits within ongoing client relationships. That points to a shift in how businesses use brokers – not just to source finance, but to help
them navigate funding over time as their needs change. Transactional deals will always have a place, especially for smaller or urgent requirements, but it is in these longer-term, relationship-led engagements that brokers are able to bring the greatest value, insight, and continuity for SMEs.
The data highlights just how differently these parts of the broker market operate in practice. Asset finance is, by nature, fast-moving: most deals complete in a matter of days, reflecting standardised products, lighter underwriting and more automated lender processes. Business finance sits somewhere in the middle, with a median of 11 days – quick enough for working-capital needs, but still shaped by credit assessment and case complexity.
Source: NACFB broker survey - November 2025 Source:
Property-led finance is fundamentally different. A median time to drawdown of 135 days reflects the reality of valuations, legal work, planning issues and layered funding structures. While some cases complete quickly, others take many months, underlining that property brokers are often managing long, complex transactions rather than high-volume deal flow.
The average NACFB Member considers six lenders for each deal 6 lenders considered
Over a quarter of clients had already been turned away before approaching a broker 26% previously declined
These data points are some of the clearest demonstrations of the value brokers bring to the market. The fact that brokers typically test half a dozen lenders for each case, that more than a quarter of clients arrive having already been declined elsewhere, and that nearly one in four end up with a different type of finance than
Nearly one in four ended up with a different product than they first requested 23% redirected
they originally asked for all point to the same thing: brokers spend their time finding routes through complexity. They are not just passing applications on – they are reshaping deals, reopening conversations and matching businesses to lenders that would otherwise remain out of reach.
Digitally e.g. via email, video calls, online platforms, portals, instant messaging, or digital document exchange
In person/over the phone
e.g. face-to-face meetings, telephone calls, or site visits
Source: NACFB broker survey - November 2025
With nearly two-thirds of client interactions still happening in person or over the phone, the data reinforces that commercial broking remains a relationship-led, trust-based form of lending – with digital tools supporting, rather than replacing, human connection.
27 lenders (core)
On average, NACFB brokers report having 116 lenders available across their full panels but rely on a core group of around 27 for roughly 80% of their transactions. This reflects a pragmatic balance between breadth and depth: brokers maintain wide market coverage across all finance types, while concentrating activity with lenders they know, trust, and can execute with
Source: NACFB broker survey - November 2025
116 lenders (full panel)
efficiently. The figures underline a key asymmetry in the market – few SMEs could realistically access, compare, or even be aware of this many funding options on their own – highlighting the value brokers add by turning a fragmented lender universe into a navigable, competitive marketplace.
Source: NACFB broker surveyNovember 2025
The 2025 data shows a market that continues to diversify, even as established players remain dominant. Specialist lenders (32%) and traditional high-street banks (27%) still account for the largest share of brokerplaced business, reflecting the ongoing need for both deep underwriting expertise and balance-sheet scale.
Despite challenger banks still accounting for nearly a quarter of broker-led lending in 2025, their share fell by four percentage points year-on-year, signalling that growth in the broker channel is no longer being driven primarily by that segment. Rather than a simple shift back to incumbent providers, the data points to a more nuanced rebalancing across the market, with modest share erosion among both specialist lenders and traditional high-street banks. This reflects how brokers actively adjust placement strategies as pricing, credit appetite and risk tolerance evolve in a higher-rate environment.
Two other shifts are also worth noting. Fintech lenders (6%) and CDFIs (2%) continue to grow from a smaller base, widening the range of routes available to SMEs, particularly for niche, regional or underserved cases. At the same time, the emergence of broker own-book funding (4%) points to a quieter but important evolution: some intermediaries are now developing balance-sheet or funding-line capabilities alongside their brokerage activity, reflecting both the maturation of larger firms and the search for more flexible ways to support clients.
That said, it is important to recognise the perennial challenge of how lenders are categorised at all. Labels such as ‘challenger’, ‘specialist’, or ‘fintech’ are imperfect and increasingly blurred, but they remain widely used by policymakers, regulators, and market analysts, so they are adopted here for consistency and comparability rather than as rigid definitions.
This result matters less for the split itself and more for what it says about the direction of travel in the market. From a broker’s vantage point – sitting across dozens of lenders, products and credit teams – 2025 felt like a year in which risk appetite began to loosen after a long period of caution.
Adverse credit history Valuation shortfall Sector policy or restriction
or insufficient trading history
Most declines are being driven by fundamentals rather than process – affordability, credit history and valuation gaps remain the biggest blockers, showing how stretched many SME deals still are against lender risk models. Policy-led constraints such as sector rules, trading history, security and LTV limits also play a growing role, reinforcing how segmented and rule-based credit has become. By contrast, issues like poor packaging or compliance barely feature, underlining that the real challenge for brokers is structuring viable deals in a tighter risk environment, not simply submitting them.
Direct underwriter contact for complex cases
Streamlined valuation and legal processes
More constructive feedback on declined cases
Faster initial triage or clearer early appetite feedback
Predictable SLAs with clear escalation routes
Conditional approvals with clearly defined deliverables
Clear, consistent criteria with fewer ad-hoc exceptions
Real-time case status updates through portals
Standardised document checklist across all products
Single broker portal or single sign-on across lender brands
Reduce re-keying through APIs or data uploads
Improved open-banking and data-ingestion tools
Pre-submission packaging guidance or templates
Source: NACFB broker survey - November 2025
We think this data paints a relatively clear picture: brokers are not asking for more technology for its own sake –they want faster, more human decisions. Direct access to underwriters, clearer early-stage appetite and more useful feedback on declines all point to a desire for real dialogue, not just digital workflows. The strong emphasis on predictable SLAs, conditional approvals and transparent criteria shows how much time is currently lost navigating uncertainty. In short, brokers want lenders who are easier to read, quicker to engage and more willing to work a case through, rather than simply pass or fail it.
Slow turnaround times
Valuation/legal delays
Lender communication
Access to decision makers
Multiple portals/re-keying
Excessive conditionality
Changing lender criteria
Packaging/documentation requirements
KYC/AML friction Commission/ compliance admin
Accessing lender panels
Source: NACFB broker survey - November 2025
What stands out here is that most friction happens after a deal is already in motion. Slow turnaround times, valuation and legal delays, and difficulty reaching decision-makers all point to bottlenecks deep inside lender processes rather than at the front end. Brokers can source clients and structure deals, but once a case enters the lender machine it often slows, fragments across portals, or becomes caught in shifting criteria and conditionality. These are not marginal irritations – they directly affect client confidence, completion rates, and the overall cost of doing business.
Lending presents the lender perspective, drawing on data from the NACFB’s lender survey conducted alongside the broker research. This chapter explores how lenders view the intermediary channel, how broker-introduced cases perform, and how lender strategies are evolving. By placing lender insight alongside broker data, it reinforces the connectivity between both sides of the market and provides a more balanced view of how the system functions in practice.
Two in every three pounds lent by NACFB Patron lenders in 2025 was broker-introduced
In 2025, 68% of SME lending value by NACFB Patron lenders was originated through the broker community, meaning that almost two in every three pounds lent flowed via intermediaries rather than direct channels. This represents a one percentage point increase on 2024, when brokers accounted for 67% of lending value.
Source: NACFB lender survey - November 2025
Whilst the change may appear modest, it is significant. The continued growth in broker share comes at a time when many lenders are actively investing in direct distribution and digital origination. Against that backdrop, the data suggests that brokers are not only retaining their relevance but strengthening their role as the primary source of meaningful lending volume across the SME market.
Broker-introduced business is no longer marginal to lender performance – it is now a core driver of growth, with the vast majority of lenders saying intermediaries actively expanded their portfolios in 2025.
Source: NACFB lender survey - November 2025
Diversified (added more products)
(focused on fewer, more specialised offerings)
Source: NACFB lender survey - November 2025
While most lenders held their core proposition steady in 2025, a large minority expanded their product range, signalling a market that is cautiously broadening rather than standing still.
The results point to a market where most lenders are putting more people behind the broker channel, reinforcing relationship-based support alongside digital platforms rather than replacing it.
Source: NACFB lender survey - November 2025
Central relationship management team
Regional BDM network
Broker training or webinars
Marketing or co-branding support
The mix of support functions shows that lenders are increasingly building multi-layered broker engagement models rather than relying on a single touchpoint. Relationship management teams and regional BDM networks dominate, underlining that face-to-face and relationship-driven distribution still sits at the heart of the broker channel. At the same time, the strong presence of training, onboarding and co-marketing points to lenders investing in brokers not just as introducers, but as long-term partners
Source: NACFB lender survey - November 2025
who need to be equipped, accredited and commercially enabled.
The comparatively lower take-up of APIs and technology integrations suggests that while digital connectivity is growing, it is still playing a supporting role to human interaction rather than replacing it –reinforcing the idea that broker distribution remains fundamentally relationship-led, even as it becomes more system-enabled.
Lenders continue to expand their broker panels, with growth evident across both full and core relationships. In 2024, NACFB Patron lenders reported an average full panel of 590 brokers, with 170 classed as core, meaning core brokers accounted for around 29% of the total panel.
In 2025, the average full panel increased to 650 brokers, while the number of core brokers grew more markedly to 240. As a result, 37% of the full panel is now considered core. This indicates that lenders are not only broadening
Source: NACFB lender survey - November 2025
access to their panels but also deepening engagement with a larger proportion of brokers within them.
Rather than signalling greater selectivity, the data points to a market in which lenders are investing more widely in broker relationships and elevating a greater share of those relationships into core status. This suggests growing confidence in the intermediary channel and a recognition that sustained lending volume increasingly comes from a broader base of trusted, active broker partners.
Strategic partners
"We collaborate closely to deliver mutual value"
Distributors
"Brokers serve as an important route to market for our products"
Clients
"We provide services and support designed to help brokers succeed"
Suppliers
"Brokers act as external introducers feeding into our lending process"
Asked across all product types, this provides a product-agnostic snapshot of how lenders see their broker relationships. A clear majority describe brokers as strategic partners, highlighting how closely intermediaries are embedded in distribution,
origination and portfolio growth. At the same time, the spread across ‘distributors’, ‘clients’ and ‘suppliers’ shows the broker-lender relationship is not uniform, reflecting the different commercial models and levels of integration that exist across the market.
From lenders’ own perspective, 2025 marked a clear shift away from the slightly defensive posture of previous years. Seven in ten lenders (70%) reported an increase in overall lending appetite, split evenly between those seeing a significant increase (35%) and a slight increase (35%). A further 21% reported no material change, while only 10% indicated any degree of contraction.
This contrasts with the broker-led view, where appetite was more often experienced as flat or uneven. The difference reflects how appetite is felt in practice.
Lenders typically assess appetite strategically and across portfolios, shaped by funding costs, capital allocation and policy resets. Brokers, by contrast, encounter appetite deal by deal, where conditionality, sector policies and underwriting friction still play a significant role.
As a result, lenders may view appetite as increasing overall, while brokers continue to experience selectivity in execution. Both perspectives can of course be true at the same time.
Affordability concerns
Outside lending criteria
Poor credit history
Valuation shortfall
Loan request above acceptable risk level
Excessive existing debt
Insufficient security or collateral
Incomplete or inaccurate application
Unrealistic or weak business plan
Weak or inconsistent cashflow Inexperienced management team
This lender view of declines is revealing when set alongside the broker perspective. Lenders point primarily to risk-based fundamentals – affordability, policy fit and credit quality – rather than operational or process issues, suggesting that most rejections are driven by balance-sheet discipline rather than how cases are packaged. That contrasts with brokers’ emphasis on valuation gaps, sector policy and trading history, highlighting how the same declined deal can look different depending on whether you are assessing risk at portfolio level or trying to place a live client. Together, the two views underline where friction really sits: not in the role of brokers, but in the tightening and interpretation of risk as economic conditions evolve.
Source: NACFB lender survey - November 2025
Source:
Lenders reported a modest but meaningful improvement in approval rates for broker-introduced applications in 2025. Nearly six in ten (59%) saw approval rates increase, with 11% reporting a significant rise and 48% a slight increase, while 32% said rates remained broadly unchanged. Only 8% experienced any decline. This points to a market where conversion improved for many lenders, though the change was incremental rather than transformational.
Approval rates, however, reflect more than raw appetite. In practice, rising approval rates can be driven by better
case selection, clearer lender guidance and more effective pre-screening, as well as by genuine easing in risk tolerance. Some lenders may also be filtering more decisively at the front end, progressing fewer cases to full assessment but converting a higher proportion of those that do. For brokers and SMEs, this means outcomes may feel more predictable for well-structured, policy-aligned cases, while more complex or marginal applications can still face friction. The overall picture is of a broker channel that is becoming more efficient, but where improved approval rates do not automatically translate into easier access for all borrowers.
Source:
The final chart in this section shows the routes lenders take when an SME approaches them directly but falls outside their lending appetite. It highlights a wide mix of behaviours, from referring businesses to commercial finance brokers or alternative funders, through to signposting to grant and governmentbacked schemes or providing informal feedback
with no onward referral at all. High-street bank responses have been removed from this question, as their actions are governed by the mandatory Bank Referral Scheme (BRS), which requires declined SMEs to be offered a formal referral route – meaning their inclusion would have distorted the wider picture of how non-bank lenders handle unmet demand.
Standards focuses on the quality and integrity that underpin the intermediary market. This chapter presents data on compliance, governance and professional conduct, highlighting how brokers are responding to regulatory expectations and operational responsibilities.
NACFB Assurance is the Association’s benchmark for professionalism, governance and good practice within the commercial intermediary market. It provides a clear and consistent standard of what business borrowers, lenders and industry partners can expect when engaging with an NACFB Member.
At its core, the NACFB Assurance is an annual, consultative assessment process designed to assess not just regulatory compliance, but the quality and integrity of how brokers operate in practice. Each review covers approximately 80 assessment points, spanning regulatory adherence, business conduct, governance, and the robustness of internal processes.
The independent assessment includes detailed reviews of policies, procedures and documentation used by brokers in their interactions with both clients and lenders. This covers areas such as client onboarding and introducers, internal documents and policies, website checks and customer disclosures, operational journey and monitoring, Consumer Duty implementation, complaints, training and fraud.
It also contextualises the NACFB’s Assurance programme, linking data to real-world standards and behaviours. The aim is to demonstrate not just the scale of intermediary activity, but the robustness and professionalism that support it.
For business borrowers, Assurance provides confidence that an NACFB Member operates transparently, professionally and with appropriate safeguards in place. For lenders, it offers a level of independent due diligence, helping to differentiate firms that meet higher standards of conduct and operational maturity. For brokers, it creates a clear framework for continual improvement, supporting consistency, trust and credibility across the market.
Together, NACFB Assurance establishes a shared baseline of expectations, reinforcing the Association’s role in championing a trusted, professional intermediary market.
This data gives a candid snapshot of where NACFB Assurance is today. With over a third of participating firms already reporting a significant improvement in compliance or client outcomes – and a further half seeing at least some benefit – it shows the framework is starting to make a real difference on the ground.
Source: NACFB broker survey - November 2025
At the same time, the 16% who have yet to feel an impact underlines that the trade body’s Assurance is still in its early stages. Embedding a common standard across broker firms, lenders, and the wider market takes time, but this provides a strong foundation on which to build awareness, consistency, and confidence in the model.
Source: NACFB broker survey - November 2025
These findings suggest that NACFB Assurance is beginning to carry meaningful weight as a quality marker, but they should be read in the context of an evolving programme. Not all NACFB Members had completed the enhanced Assurance process at the time of the survey, and this is likely to have influenced how brokers currently perceive its value. Just over half of respondents view Assurance as a meaningful quality signal when engaging with clients and lenders, which represents a strong early endorsement for a relatively new, expanded framework.
The sizeable neutral group highlights that awareness and experience of the enhanced process are still developing across the membership, rather than indicating scepticism or resistance. The NACFB expects all Members to have progressed through the new Assurance process by the end of 2026.
As adoption becomes universal and familiarity increases, the Association anticipates greater recognition of Assurance as a clear and consistent marker of professionalism, governance and trust across the intermediary market.
This data paints a picture of brokers operating in a regulatory environment that feels increasingly interpretive rather than rule-based. It’s not the mechanics of compliance that worry firms most, but the grey areas – how Consumer Duty applies in practice, how data and AI can be used safely, and where the credit broking perimeter really sits. These are not questions with simple yes-or-no answers, and that uncertainty creates risk for firms that are trying to do the right thing while still serving clients quickly and commercially.
That is why the NACFB has leaned so heavily into practical guidance, helplines, templates and scenario-based support: not to replace regulation, but to help brokers navigate it with confidence in the spaces where the rules are still evolving and often unclear.
Source: NACFB broker survey - November 2025
The picture is clear: percentage-based commission remains the commercial backbone of broker-led SME finance, used by almost all firms. But it is no longer the whole story. A quarter of brokers now operate hybrid models combining lender commission with client-paid fees, while flat fees, retained commissions and success-based structures all feature meaningfully across the market.
6.5.
Source: NACFB broker survey - November 2025
This growing mix reflects a market that is becoming more sophisticated and more client-led. Brokers are increasingly tailoring how they are paid to the nature of the deal – balancing upfront effort, ongoing service, and risk – rather than relying on a single, one-size-fits-all commission model.
We already fully disclosed commissions — no changes were required
We made changes to move from partial disclosure to full disclosure
We made changes to introduce partial disclosure (where none was previously given)
We continue to provide partial disclosure only
Not sure/still reviewing our approach
We do not currently disclose commissions to clients
Source: NACFB broker survey - November 2025
The results underline how far ahead of the curve much of the NACFB community already was. Well before the Supreme Court judgment, the Association had recommended full commission disclosure as best practice, setting clear expectations for transparency across the membership. As a result, most firms report that no material changes were required when the ruling and updated disclosure expectations came into effect in 2025.
Where firms did adjust their approach, it was largely to move from partial to full disclosure rather than to introduce transparency for the first time. This suggests that, for NACFB Members, the regulatory shift was primarily about formalising and evidencing established good practice, rather than forcing a fundamental change in how firms operate.
system or CRM updates to record disclosures
sales process or order of client conversations
This data shows that most firms responded to the new disclosure environment in practical, client-facing ways first – updating engagement letters, refreshing disclosure wording and training staff – rather than
Source: NACFB broker survey - November 2025
through wholesale commercial or systems change. Nearly a third made no operational changes at all, which reinforces that many NACFB Members were already operating on a full-disclosure basis before 2025.
Source: NACFB lender survey - November 2025
This result points to a market built far more on partnership than suspicion. With the vast majority of lenders rating trust as high or very high, it reflects
how broker-introduced business has become embedded in lenders’ day-to-day operations rather than treated as a risk channel.
Quality and completeness of applications
Conversion rates (approved to completed)
Repeat business
Consistency in meeting lending criteria
Timeliness and responsiveness
Volume of deals submitted
Customer satisfaction
Deal approval rates
What stands out here is that (most) lenders seem to care far more about the quality of what brokers bring them than the sheer volume they send. Complete, well-packaged applications and strong conversion rates sit well ahead of deal flow alone, which points to a market that values efficiency,
Source: NACFB lender survey - November 2025
credit discipline and mutual time-saving. Repeat business and consistency also rank highly, reinforcing the idea that lenders value long-term, dependable relationships over one-off transactions – even if, anecdotally, that hasn’t always been the experience across the wider market.
Incomplete or inconsistent application quality
Inaccurate or missing client information
Delays or inefficiencies in information exchange during the process
Unrealistic borrower expectations set by brokers
Poor alignment between client suitability and proposed funding solutions
Limited understanding of credit appetite or lending approach
Overemphasis on volume over quality of deals
Misalignment between broker submissions and product criteria
Communication breakdowns or mismatched expectations between teams
Lack of transparency over fees or commission structures
Brokers not staying up to date with criteria or policy changes
Broker compliance or due diligence concerns
What stands out most clearly is that lenders’ biggest frustrations are not about intent or trust, but about execution. The top two issues – incomplete or inconsistent applications (53%) and missing or inaccurate client information (52%) – point to a process problem rather than a relationship problem. Brokers are bringing opportunities, but too often the data and packaging needed to progress them cleanly is falling short. This is reinforced by the prominence of delays in information exchange (37%) and unrealistic borrower expectations (28%), suggesting deals are
Source: NACFB lender survey - November 2025
frequently entering the system before they are fully ready to be assessed.
Lower down the list, concerns around alignment with lender appetite, product criteria and volume-driven behaviour show that lenders are looking for fewer, better-prepared cases rather than more raw deal flow. Notably, classic ‘trust’ issues – such as fees, compliance or policy awareness – sit near the bottom, implying that the relationship itself is broadly sound, but operational friction is holding it back.
Product and criteria training
Clearer deal feedback and outcome reporting
Dedicated relationship or support managers
Simplified documentation and application processes
Access to case studies or best-practice examples
Enhanced digital submission platforms or APIs
Regular real-time updates on lending policy changes
Guidance on compliance and regulatory requirements
Joint marketing or co-branding opportunities
Lenders are asking for better-prepared, better-understood cases first and foremost – with training, clearer feedback, and stronger human support seen as more valuable than technology alone.
Checking FCA authorisation or regulatory status
Conducting in-person or virtual meetings
Assessing submission quality and accuracy
Monitoring ongoing conduct and transaction behaviour
Reviewing financial stability or solvency
Using third-party compliance or due-diligence services
Reviewing participation in the NACFB Assurance Consultation
Verifying professional indemnity (PI) insurance
Completing on-site audits or visits
Requesting trade or client references
Source: NACFB lender survey - November 2025
What stands out is how strongly lenders lean on regulatory status, direct engagement, and live performance data – FCA authorisation, meetings, submission quality, and ongoing conduct all rank well ahead of formal audits or third-party checks. That creates a powerful halo effect for regulated brokers: with around 90% of NACFB Members authorised, and the FCA’s ‘use it or lose it’ approach to permissions, for some lenders, regulatory status has become a proxy for credibility as much as compliance.
Against that backdrop, the NACFB Assurance scheme is still in its early days – only a third of lenders are currently factoring it into due diligence – but that figure should rise as lender integrations and workflows are embedded through 2026. The tension the data reveals is real: some brokers continue to hold permissions largely to stay on lender panels, while lenders are increasingly looking beyond the badge to how firms actually behave, package, and deliver cases in practice.
Source: NACFB lender survey - November 2025
2
5 6 Annually On a rolling or continuous basis Every six months (biannually) Quarterly When concerns or issues arise
The NACFB Patron lenders surveyed consistently report conducting due diligence at the point of onboarding brokers to their panels, reflecting this as a universal baseline across the market. Beyond onboarding, however, there is clear variation in how frequently due diligence is reviewed. Some lenders
favour regular, scheduled reviews, while others adopt a rolling or risk-led approach, undertaking additional checks when concerns arise. This spread of practices highlights differing risk frameworks and resource models, and reinforces the value of clear, consistent broker standards across the intermediary market.
NACFB membership as a kite mark
This data shows that NACFB membership already carries real weight in lender decision-making: a clear majority either require it, prefer it, or use it at least occasionally when assessing broker quality. That gives the Association a meaningful starting position as NACFB Assurance is rolled out with lenders
Source: NACFB lender survey - November 2025
in 2026. In effect, the market is already signalling trust in NACFB as a filter for professionalism and standards – Assurance now has a ready-made channel through which it can deepen, formalise, and strengthen that confidence across lender panels.
This data suggests that while quality-linked incentives are not yet widely embedded, they are clearly on lenders’ agendas. A small proportion are already linking remuneration or service benefits to submission quality, and a much larger group are actively considering doing so.
We already use commission structures linked to submission quality
Yes
We already use non-commission incentives linked to quality (e.g. priority processing, enhanced SLAs)
Yes
We use a combination of commission and non-commission quality incentives
But we are actively considering introducing quality-linked incentives
We have no plans to introduce quality-linked incentives
Source: NACFB lender survey - November 2025
This aligns with what the NACFB is beginning to see in practice: early experimentation by some lenders to reward better-packaged, higher-quality cases as a way of raising standards across the market, even if this approach has not yet become the norm.
Future looks ahead. Drawing on survey insight and industry trends, this chapter explores what brokers and lenders expect over the coming years – from technology and regulation to changing
client needs and business models. It captures both optimism and challenge, offering a forward-looking view of how the intermediary market may evolve, and what that means for the connected economy.
Reduced
Valuation/legal
Competition (direct-to-lender/fintech)
Regulatory burden
Technology/ cyber risk
Talent/skills shortages
Fraud/financial crime
Margin compression Rising defaults
Source: NACFB broker survey - November 2025
Brokers see the biggest threats as coming from the wider economic climate and lender behaviour rather than from within the sector itself, reinforcing how closely intermediary activity remains tied to SME confidence and credit availability.
e-signature/document collection
Digital onboarding/e-IDV
AI case-matching/ assistant tools
Portal integrations/API
Cybersecurity/ compliance tooling
Automation
Deal origination/lead gen
Pricing/term-sheet tools
Open banking connectivity
Data enrichment/ credit analytics
No technology investment
Source: NACFB broker survey - November 2025
The pattern here shows brokers using technology mainly to streamline and automate everyday processes –onboarding, document handling, CRM and compliance –rather than to replace human judgement or relationships, reinforcing that tech is being used to make brokers more efficient, not less personal.
Faster decisions/ simpler journeys
Quicker valuations and legal turnaround
Recognition of brokers as a quality “kite mark”
Broader lender risk appetite (sectors/credit profiles)
Reduced reliance on Personal Guarantees
More flexible underwriting for thin-file/newer SMEs
Better awareness
Expanded government guarantee schemes (e.g. GGS)
Standardised criteria & data templates across lenders
Regional funding initiatives/ levelling-up capital
Clearer regulatory perimeter & guidance
Better use of open banking & credit data sharing
Stronger fraud prevention/ KYC tooling
Greater transparency on pricing & fees
Improved green/transition finance incentives
Source: NACFB broker survey - November 2025
What brokers are really pointing to here is friction, not funding. The top responses cluster around time, process and uncertainty: slow decisions, drawn-out valuations, legal bottlenecks and inconsistent lender criteria. In other words, capital exists, but it too often gets trapped behind operational drag that SMEs simply don’t have the cashflow or patience to absorb.
The second clear theme is trust infrastructure. The call for brokers to be recognised as a quality kite mark sits alongside demands for more flexible underwriting and broader risk appetite – lenders are being asked to take more risk, but only where there is a credible, professional intermediary standing between them and the borrower.
Finally, it’s striking how low purely financial engineering fixes rank. Less reliance on guarantees, new schemes and pricing tweaks matter far less than getting the basics right: faster, clearer, more consistent routes from enquiry to drawdown. In that sense, this is as much a call for market plumbing to be modernised as it is for more capital to be deployed.
The outlook points to a market being pulled in two directions at once: away from commoditised bank lending and towards more specialist, advisory-led finance, with technology acting as the engine that makes that shift workable at scale. Even with margin pressure and regulation in the background, brokers clearly expect their role to deepen rather than shrink as SMEs look for more nuanced, tailored funding solutions.
Source: NACFB broker survey - November 2025
Source: NACFB broker survey - November 2025
Even with brokers traditionally more cautious than their lending counterparts, the data shows a market that feels broadly well-placed to adapt to shifting SME demand over the next three years.
1 2
Brokers will become more strategic partners
Relationships will deepen beyond simple deal submission.
Brokers will specialise in niche/complex markets
Their focus will shift to specialist or complex deals.
3
Lenders will use smaller, more selective panels Panels will consolidate around higherperforming brokers.
What comes through in this data is not a retreat from brokers, but a reshaping of their role: lenders increasingly see brokers moving up the value chain, becoming more specialised, more strategic, and more embedded in deal-shaping
4
Brokers will become more important
Their role in sourcing and shaping deals will grow. Technology will reduce reliance on brokers Digital processes will streamline lending and lower broker involvement.
5 6 7
Brokers will remain broadly the same
No major change to their role or influence. Brokers will become less important as lenders go direct Direct channels will reduce reliance on brokers.
rather than simply passing on applications. Even as technology takes friction out of processes, lenders still expect human judgement, market knowledge and relationship-led intermediation to become more important, not less.
This shows a market that is clearly mid-transition: most lenders are now actively building or upgrading their broker portals and integrations, rather than standing still. Yet the sizeable minority still relying
on manual or limited systems explains why brokers continue to experience uneven journeys across panels, reinforcing the value of intermediaries who know how to navigate that complexity.
Source:
Lenders are overwhelmingly confident they can grow and handle rising broker demand, pointing to a market that is investing for expansion rather than bracing for contraction. Good news.
Technological disruption or legacy system limitations
competition from other lenders
Reduced borrower demand
Increased risk of fraud or financial crime
Declining quality of broker submissions
Regulatory tightening or new compliance requirements
Interest rate volatility
Erosion of trust in brokerlender relationships
Staffing or resource shortages
Fee or commission transparency pressures
Disruption or withdrawal of funding lines
Broker-originated lending or disintermediation
Source: NACFB lender survey - November 2025
Lenders’ biggest concerns are inward-looking: technology constraints, legacy systems, and intensifying competition all rank well above borrower demand or broker behaviour. Notably, fears of broker-led disintermediation barely register, reinforcing that lenders see brokers as part of the solution rather than a strategic threat.
Core to strategy
Brokers are primary route to market
Important
Brokers represent a key growth channel among several
Moderate
Brokers play a supportive but not central role
Limited
Brokers are used selectively for certain products or segments
of long-term growth plans
Source: NACFB lender survey - November 2025
This is perhaps one of the clearest signals from across this year’s data set: for most lenders, brokers are no longer just a distribution channel, but a core part of how they expect to grow. The fact that nine in ten lenders place brokers somewhere between
‘important’ and ‘core’ reflects a market that increasingly relies on intermediaries not just for volume, but for reach, risk-filtering and access to the SME economy that lenders cannot efficiently serve on their own.
Expand
Actively recruit and onboard more brokers
Retain approximately the same number of active brokers
Rationalise
Reduce the number of active brokers but strengthen existing relationships
Source: NACFB lender survey - November 2025
This points to a market that is still very much in expansion mode: most lenders are actively looking to bring more brokers onto their panels rather than retrench. The small proportion planning to rationalise
suggests that while quality and focus matter, the overriding strategy is to broaden reach and deepen intermediary coverage as broker-led origination continues to grow.
Source: NACFB lender survey - November 2025
Source: NACFB lender survey - November 2025
These two distinct data sets, both lender confidence and broker sentiment, point to a market that is cautiously positive, but viewed through different lenses. Lenders, assessing their own portfolios, pipelines and capital positions, report a high degree of confidence in their outlook for the year ahead. A clear majority expect lending activity to remain strong, with confidence underpinned by balance sheet strength, funding access and continued demand across core segments.
Broker sentiment, by contrast, perhaps reflects a wider and more immediate view of the SME landscape. Whilst brokers remain broadly optimistic, their outlook is more mixed, with a larger neutral and pessimistic cohort. This divergence likely reflects brokers’ proximity to client decision-making, where uncertainty around costs, margins and timing continues to shape borrower behaviour, even where funding appetite exists.
Importantly, these perspectives are not contradictory. Instead, they highlight the intermediary’s role in translating lender confidence into real-world outcomes for businesses. Brokers operate at the point where appetite meets uncertainty, balancing lender willingness with borrower readiness and risk. The alignment between strong lender confidence and measured broker optimism suggests a market that is functioning, but selectively and with greater judgement than in previous cycles.
As this future-facing chapter closes, the data reinforces the central theme of The Connected Economy: that sustainable SME lending depends not just on capital availability, but on trusted intermediaries bridging the gap between confidence and caution across the market.
TFuture looks ahead. Drawing on survey insight and industry trends, this chapter explores what brokers and lenders expect over the coming years – from technology and regulation to changing
his final chapter brings together the insight, evidence and themes explored throughout this report and looks outward. It sets out how the NACFB will use this data to shape a focused and realistic programme of advocacy over the next twelve months, translating market insight into clear priorities for the intermediary community. It outlines a small
In late 2025, HM Treasury published its response to the Government’s call for evidence on SME access to finance. Across submissions from industry, regulators and business support organisations, a clear theme emerged: commercial finance brokers are an increasingly important part of how small businesses navigate a complex and fragmented funding landscape. The Government recognised that applications supported by qualified brokers and advisers tend to be more successful, not because of product availability, but because brokers help businesses understand options, address weaknesses and approach lenders more effectively.
The response also reflected the views advanced by the NACFB and echoed across the sector – that the future challenge is not one of demand or supply, but of structure, standards and visibility.
Embed Assurance as the foundation of trust in the broker market.
In 2026, the NACFB’s foremost priority is to embed its broker Assurance programme as a recognised marker of quality, professionalism and trust across the SME finance ecosystem. As the intermediary market grows in scale and prominence, confidence in how brokers operate – not just the outcomes they deliver – becomes critical.
The Assurance programme is designed to be totemic in nature: a clear, visible signal to borrowers,
client needs and business models. It captures both optimism and challenge, offering a forward-looking view of how the intermediary market may evolve, and what that means for the connected economy.
number of achievable aims and policy initiatives, informed by broker and lender perspectives, and grounded in the realities of the SME finance market. By connecting evidence to action, this section provides a clear steer on how the NACFB will champion standards, support market efficiency, and drive better outcomes for businesses seeking finance.
Stakeholders highlighted the need to strengthen the intermediary market through clearer professional standards, accreditation, transparent commission practices and closer integration with the wider business support ecosystem. Alongside this, Government acknowledged concerns around conduct in parts of the market and committed to working with the sector to support best practice.
This section builds directly on that moment. For the NACFB, 2026 is a year for collaboration –with government, lenders, regulators, professional bodies and brokers themselves. It recognises the Association’s growing footprint and responsibility and sets out a focused programme of achievable actions designed to improve market efficiency, raise standards and deliver meaningful, practical change for UK SMEs.
lenders, regulators and government that an assured NACFB broker meets consistently high standards of conduct, competence and transparency.
The Association’s focus in 2026 will be on driving understanding and acceptance of what NACFB Assurance means in practice – why it matters, who it protects, and how it raises confidence for all parties engaging with the broker channel.
The single aim is simple but significant: to materially improve recognition, adoption and understanding of Assurance as the benchmark for trusted intermediary practice.
Develop a collaborative solution to the Bank Referral Scheme.
The NACFB believes the current Bank Referral Scheme does not adequately reflect how SMEs access finance today. In its submission to HM Treasury last year, the Association called for brokers to be recognised as a core pathway for declined businesses, particularly where funding readiness, diagnosis and structuring are the true barriers to success.
In 2026, the NACFB will work collaboratively with HM Treasury, the British Business Bank, lenders,
Improve the quality and coherence of SME finance data.
A recurring challenge for policymakers, lenders and trade bodies alike is the absence of a single, coherent view of SME lending activity across the market. Data is often collected repeatedly, through different lenses, with limited alignment between high-street banks, challengers, non-bank lenders and intermediaries.
In 2026, the NACFB will seek to convene industry partners, fellow trade bodies and government
The evidence in this report is clear: progress in SME finance depends on collaboration. Brokers already play this role on the ground – bringing together lenders, advisers and businesses to solve complex funding challenges. In 2026 and beyond, the NACFB intends to mirror that convening role at a market level, working across the ecosystem to raise standards, improve efficiency and deliver better outcomes for small businesses.
platforms and other stakeholders to help shape a more effective, market-reflective model – one that prioritises journey routing over repeated rejection, and embeds broker-led support where complexity demands it.
The objective by the end of 2026 is clear: to secure tangible progress towards a re-designed access-to-finance pathway in which assured brokers are embedded as a credible, visible and trusted route for declined SMEs.
stakeholders to explore the development of a shared source of truth for SME finance data. The aim is not ownership, but coordination – improving granularity, consistency and comparability so that future policy and market interventions are grounded in robust evidence.
A more aligned data foundation will underpin smarter decision-making, better-targeted policy, and more meaningful reform across the SME finance landscape.
The Association welcomes engagement from organisations operating across commercial finance who share those aims. Whether through policy development, data collaboration or practical market initiatives, there is an opportunity to work together to build trust, strengthen access and drive meaningful change. The challenges are shared — and so is the opportunity to address them.
We invite partners across the sector to work with the NACFB in 2026 and beyond.
The analysis presented in this report is based on original survey research conducted by the National Association of Commercial Finance Brokers (NACFB), combined with independent analysis and modelling undertaken by Freshminds.
Primary data was collected by the NACFB through two bespoke surveys conducted in the final weeks of November 2025. One survey captured responses from NACFB Member broker firms, while the second focused on NACFB Patron lenders, enabling a dual-perspective view of activity, sentiment and behaviour across the intermediary market.
The broker survey achieved responses from over one third of NACFB Member firms, representing a wide range of firm sizes, business models, finance specialisms, regions and regulatory structures. The lender survey captured responses from approximately 50% of NACFB Patron lenders, including high-street banks, challenger banks, specialist lenders and alternative finance providers active within the broker channel.
Once data collection was complete, all survey responses were fully anonymised prior to analysis. Individual firms, respondents and transactions were not identifiable within the data sets shared with Freshminds, and no firm-level results are attributed or disclosed within this report.
Freshminds was responsible for validating the data sets, identifying patterns and trends, and applying a
structured projection model to map survey findings to the NACFB’s full membership base. This modelling approach enables reported figures to reflect estimated full-membership outcomes, rather than raw respondent data alone, providing a more representative picture of market scale, activity and behaviour across the intermediary ecosystem.
The projection framework used in this report has been developed and refined over a number of years, drawing on Freshminds’ experience delivering ecosystem analysis, market mapping and large-scale data modelling projects across financial services and technology markets internationally. The work was led by Eduardo Rios, Senior Product Consultant within Freshminds’ Research Consultancy team.
Throughout the analysis, outputs were reviewed for internal consistency and plausibility, and contextualised using trusted third-party data sets referenced elsewhere in the report. While the NACFB commissioned and owns the research, Freshminds operated as an independent analytical partner, with responsibility for modelling and interpretation undertaken separately from the data collection process.
This separation of roles provides appropriate governance and helps ensure the findings presented are objective, transparent and robust, offering a credible evidence base to inform industry insight, policy engagement and strategic decision-making.
The NACFB would like to extend its sincere thanks to the individuals and organisations whose insight, expertise and support helped to frame, inform and steer the Association’s first Intermediary Market Outlook
Our thanks go to Eduardo Rios (Freshminds) for his data analysis and extrapolation; Dr Louise Knapper (NACFB) for her patience and determination in getting the report over the line; Samantha Scales (NACFB) for design and layout; Laura Mills (NACFB) for insight, proofing and strategic steer; and Tom Patten (NACFB) for his detailed analysis of NACFB data.
We are also grateful to Jake Horwood (British Business Bank) for his support, insight and candour; Rick Limentani and Roger Westerbeek (Federation of Small Businesses) for their time, energy and perspective; Shiona Davies (Ipsos) for her generosity, insight
If you would like to engage with the NACFB on the themes outlined in this report, or explore opportunities to collaborate in 2026 and beyond, we welcome enquiries from across the commercial finance ecosystem.
and long-standing support; and Richard West and Erin Fogarty (Red Flag Alert) for their continued insight and collaboration.
We would also like to thank those friends of the Association who joined our roundtable discussions to provide anecdotal insight and help shape lines of enquiry and analysis: Ian Coulson (HSBC), Dave Furnival (NatWest), Brandon Hall (Allica Bank), Evette Orams (Hilton-Baird), Marc Champ (Wharf Financial), and Corey Dennis (Arc & Co.).
Thank you to all NACFB lender sponsors, and in particular this year’s headline sponsor, HSBC UK.
Finally, a special thank you to the entire NACFB team and Board of Directors at Eastcheap for their continued support, challenge and guidance throughout the year.
Head of Communications & Advocacy
National Association of Commercial Finance Brokers (NACFB)
press@nacfb.org.uk www.nacfb.org
07810 123 836
