Embedded finance
Embedded finance is the practice of offering financial products—payments, accounts, cards, lending or insurance—inside a non-bank product experience such as a marketplace, ride-hail app or SaaS tool.1 It overlaps with banking as a service on the supply side and with neobanks when the host brand owns the customer relationship.
Overview
Instead of sending users to a bank, platforms embed checkout lending (Klarna), wallets (Mercado Pago), or bank accounts (Bank Jago inside Gojek). Technology providers and licensed banks supply the regulated rails; the platform supplies distribution.
Examples
Examples include Stripe treasury/payments for software platforms, marketplace wallets such as Mercado Pago, telecom mobile money such as M-Pesa, and corporate-card embeds from Brex or Ramp inside spend workflows.
Relation to neobanks
Many front-end neobanks are embedded-finance companies whose "platform" is their own app. Others are pure embeds with no standalone bank brand. Both rely on licences, partner banks or electronic money permissions.
External links
References
- Embedded finance distributes regulated financial products inside non-bank customer journeys. https://www.bis.org/fsi/publ/insights28.pdf
Frequently asked questions
- What is Embedded finance?
- Embedded finance is the distribution of financial products inside non-financial apps and platforms via APIs and partners.
See also
- Accrue - Accrue is a Ghana- and Nigeria-rooted fintech that moves money across Africa and the US using a stablecoin agent network.
- Airwallex - Airwallex is an Australian-founded business fintech for global accounts, payments and spend management.
- Alex Johnson - Alex Johnson is the founder of Fintech Takes, a widely read fintech newsletter and podcast; he is active on X as @AlexH_Johnson.
- Alexandre Prot - Alexandre Prot is co-founder and CEO of Qonto, the Paris-based European business neobank.
- Ali Niknam - Ali Niknam is founder and CEO of Bunq, the Amsterdam-based licensed Dutch neobank.