What Is The Future Of Embedded Finance?

WHAT IS EMBEDDED FINANCE

Embedded finance allows non-fintech companies to make use of financial services or products in their business proposition. It allows all kinds of companies to offer services such as payment processing, lending, banking services among others, all within the same ecosystem. These new services help with improving customer engagement and enhance user experience.

NEW TRENDS WITHIN EMBEDDED FINANCE

While services involving payments and lending will continue to be the most popular services within embedded finance, there are new trends with potential which include insurance, tax and accounting services. Moreover, some service functions which are gaining popularity include:

Payment Trends – These trends include the use of integrated payments, where transactions can be processed simultaneously between banking systems, saving time and effort. This improves user experience and can result in brand loyalty and customer retention. Buy now, pay later (BNPL) is also a trend in the payment category which is increasing in popularity. BNPL offers a point of sale loan which increases user experience and customer loyalty. This encourages customers to buy more as they can pay their bills later on, which in turn boosts sales. Lastly, there’s an increasing importance in payments made through digital wallets and supporting the use of debit and credit cards in digital wallet applications such as Apple Pay.

Find out more in our open banking module here 

Banking Apps – The success of these apps doesn’t necessarily only involve providing banking services, but can also branch out to offer other financial services such as investing, insurance and cryptocurrencies. The trends in banking apps which have proved to be most important include focusing on perfecting the user-centric experience, by offering an app which is convenient and with services which will allow users to bank in an efficient and easy way. Secondly, including AI and machine learning in your app can allow for more customisation in mobile banking. Lastly, the use of gamification elements make the user experience more exciting and can encourage users’ purchases, increasing customer loyalty.

Check out our customer loyalty module here

B2B Solutions – Most embedded finance tends to focus on B2C services, however there has been an increased interest in B2B applications. In particular, embedded B2B lending has increased in popularity, as small businesses have limited access to traditional bank loans.

Increase in API use – These plug-ins allow for the integrations of additional services into the business offering and providing a competitive advantage. It enables businesses to pick and choose the services they want to incorporate and opens up the opportunity for many productive partnerships.

KYC/KYB – The process of onboarding clients can be long, however with KYC, there is a possibility for an automated process which accelerates client onboarding. These processes have gained popularity in order to improve efficiency and comply with regulations.

Check out our KYC module here

HOW CAN YOU INTEGRATE THESE SERVICES INTO YOUR BUSINESS?

Platforms like Be1B offer embedded finance solutions. We offer a range of modules which can add the mentioned financial services to your business offering. If you would like to know more about our embedded finance solutions, book a demo with our team now.