A new finance era: what is embedded finance?

According to Oracle, embedded finance has a market opportunity estimated to be worth over $7 trillion in the next ten years, twice the value of the world’s top 30 banks combined today.
3 minutes

Quick summary

  • 60% of UK adults have used embedded finance services the last year
  • Embedded finance is the integration of financial services into the purchase experience
  • Almost any business can leverage embedded finance
  • Many benefits, including cost efficient and secure

Even if you’ve never heard of the term “embedded finance” before, 60% of UK adults have used embedded finance services in the past year, according to research by Temenos. Well-known examples of embedded finance include Uber, that embeds payments into the customer experience, allowing customers to pay automatically through the app (embedded payments), Klarna’s buy now, pay later (BNPL) service integrated in many store’s checkouts (embedded lending). So what is embedded finance and what are the benefits? We’ve summed it up here:


🤔 What is embedded finance?

Simply put, embedded finance is the integration of financial services into the purchase experience of products or services of non-financial organisations, rather than being a separate part of the purchase experience.


🌍 Who’s it for?

Embedded finance isn’t just for financial institutions. Almost any business can leverage embedded finance to further innovate their product and service offerings.


💡What are the benefits?

The benefit of embedding finance is to streamline the financial aspects of the products or services, giving consumers a much better end-to-end customer experiences right at the point of service. This results in driving customer loyalty, and potentially making it more difficult for other businesses to compete. It can also be a valuable tool in tackling current problems such as slow payments and low conversion. On the flip side, embedded finance provides valuable data to further a business’ development and create personalized products and services. It’s a win-win both for consumers and businesses.

✔️Secure, both for the end-user and merchant

✔️Better customer experience, faster and room for customisation

✔️Cost efficient  

✔️Data to innovate further for customers

Today’s customers have higher expectations than ever before, forcing companies to have a more customer-centric strategy and product offering. The potential for embedded finance is so vast, that it’s a challenge to measure just how big this market opportunity could become. But that hasn’t stopped companies already incorporating it — and we’re seeing big players already do so. It’s clear that embedded finance will allow businesses to add new revenue streams and take their offerings beyond than what previously possible. We’ll see a time where all businesses will embed finance, but businesses that embrace it early will benefit the most.


Want to get ahead on embedded finance?👇

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