Embedded finance: Lead the next payment revolution | ECS Fin

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BaaS

Embedded finance:
Lead the next payment revolution

With the rapidly evolving embedded finance sector, the future of finance is considered open, transparent, and secure. The new frontier services in the financial era unlock thousands of new services and tools for banks, corporates, and capital markets. The barriers that non-banking providers face when integrating with financial products have started to fall, fortunately, with the evolution of BaaS and embedded finance services.

Embedded finance: Lead the next payment revolution
Findings:

One-third of embedded finance providers (financial institutions) expect to accelerate their revenues from BaaS offerings.

SME lending is already generating over $250 bn in market revenue and is projected to grow further by 30% until 2024.

90% of senior executives are planning to follow the wave of incorporating embedded finance solutions within 12-18 months.

What is Embedded Finance?

Embedded finance refers to the seamless integration of financial services into traditionally designed non-financial services. This new frontier service will enable customer-facing digital platforms to embed financial products/services into their legacy platforms. Earlier, if an organization wanted to serve its customers with financial services, they were forced to develop a new fintech services, making the process even more cumbersome and expensive.

Integrating financial products/services into digital interfaces that users can experience daily makes the generation of embedded finance so important and influential. For businesses and consumers, using these interfaces and acquiring financial services becomes the natural extension of non-financial experiences such as managing inventory, shopping online, and scheduling sheets.

The growth potential across industries e.g.,

Key players in the Embedded Finance ecosystem

Key players in the Embedded Finance ecosystem

The infrastructure of embedded finance consists of three leading institutions that unanimously work together to develop a financial arm for the users.

Digital Solutions/Platforms:

The non-fintech organizations that own customer-facing digital solutions such as websites, desktop applications, or mobile apps provide personalized financial solutions to customers embedded within their applications.

Enablers:

Fintech companies such as ECS Fin develops end-to-end processing software solutions to build a connection between financial institutions and digital platform providers. Preferences of enablers:

    A scalable, stable, and secure API platform and marketplace.
    Expertise in financial services.
    End-to-end payment processing models.
    System integration and digitization capabilities.

Providers:

Financial institutions/banks holding regulated and compliant financial products to manage compliance, credit risk, and compliance from the embedded finance ecosystem.

Important decisions for entrants of the embedded finance market

The embedded-finance market still has ample space and network for new entrants and expects to grow double over the next three to five years. The long-term players of the games are likely to be those developing the stakes of expertise, relationships, and technological solutions. If you want to claim your stake in the embedded-finance business world, ECS Fin advises committing to the road of implementing the following initiatives:
Choosing a strategy.
Establishing a developer experience.
Building capabilities to support distributors, and
Developing risk and support services.

Conclusion

ECS Fin understands the complex challenges of maintaining a balance for embedded finance services for the players with their everyday priorities in the financial world. We focus on discrete, differentiating, and profitable strategies that align with your operations and help you make the greatest influence on positioning and pricing. Our solutions are designed with a customer-centric and transaction processing approach to optimize any payment processing environment.