For decades, financial services delivery has revolved around products: an account, a loan, a policy. But the world has evolved, and customers don’t want to purchase insurance or open a new account for the product itself, but as a means to a more important end, such as saving for a new home or insurance for a dream holiday. For others, they are the way to proactively manage their finances, set money for a rainy day, or build a savings safety net.  

Historically, that would have meant finding a financial provider, or providers, to meet each specific need.  

That is where embedded finance is a catalyst for change. 

Broadly speaking, embedded finance refers to integrating financial services within non-financial platforms. As a result, it enables non-financial businesses to offer banking, lending, payments, or insurance services directly within their digital ecosystems. This eliminates the need for customers to engage with external financial services third parties, creating a more seamless and efficient experience. You can read more about the types of embedded finance here. 

But which services are brands looking to embed, and why?  

We recently conducted in-depth research with 200 senior decision makers at leading corporates, to capture the strategies and priorities of organisations with the scale to shape the market. 

In this article, I’ll discuss some of the results from this research, focused on senior leaders’ familiarity with embedded finance and motivations for adopting these services.  

Our research found that, overall, most senior leaders are familiar with the term "embedded finance." Specifically, 42% of respondents indicated that they are very familiar with the concept, while 39% reported being somewhat familiar.  

 The understanding of embedded finance was also consistent across different seniority levels and responsibilities; however, a greater proportion of C-level respondents (30%) expressed being very familiar with the idea, compared to 20% of other senior leaders.  

The most common associations with embedded finance are payments, which ranked the highest at 92%. This was significantly ahead of lending, which had a 51% association, followed by loyalty-linked rewards at 49%. These results are not surprising, considering the widespread adoption of digital wallets such as PayPal, peer-to-peer payments through social platforms like WeChat and Telegram and BNPL services. 

By integrating payment processing directly into platforms, apps, or business software, users can complete transactions seamlessly without leaving the environment they’re already using. 

It offers greater convenience and improves the customer's experience by reducing friction at the point of sale and supporting faster, real-time payments.  

It's no surprise, then, that the services currently offered by their companies align closely with these associations. 41.5% already provide embedded payments, while 17% have exciting plans to introduce them, and 16% are actively exploring this promising opportunity. 

By integrating embedded payments, firms can reduce friction at checkout, decrease cart abandonment, and enable instant, secure transactions within their platforms. 

They also represent a shift from transactional thinking to value-driven engagement. When financial products are integrated into the brand experience, journeys become personalised, satisfaction rises, and repeat usage follows. The data produced by greater interactions with their brand helps teams to spot patterns and anticipate needs. 

There are also clear operational benefits for firms, as one respondent explained:   

Many firms are looking to implement embedded payments, with 76% planning to do so within two years, and 29% of those expecting to go live with their services within that timeframe. 

When we examine why corporates are looking to embed financial services, some clear trends emerge.  

Most respondents view embedded finance as somewhat important (39%), important (30.5%) or extremely important (12.5%) to their organisations’ growth strategy. It’s interesting to note that senior executives trended towards somewhat or important, whereas more C-level executives view it as extremely important.  

As one leader explained:  

When we dig deeper, several factors driving this growth emerge.  

• Improving the customer experience: 63% stated that improving the customer experience is the main reason for examining or offering embedded services, which aligns with the majority who consider payments as the most attractive use case for their organisation. The importance of customer-centric services is also evident in the 57% who believe they can improve customer retention and loyalty, and the 39.5% who view it as a means to establish additional customer touchpoints.  

It’s also interesting to note that this theme saw the most deviation by seniority. C-level respondents leaned towards 'Supporting customer retention and brand loyalty,' while other senior decision makers ranked 'Improving the customer experience’ higher.  

Delivering an improved experience was also deemed the most significant benefit to end customers (85%), followed closely by seamless payments (83%), convenience (80%) and faster transactions (75%).  

This isn’t theoretical, as one interviewee explained:

• Driving new revenue streams:  The ability of embedded services to drive new revenues is also top of mind, with 55% citing their ability to deliver new revenue streams and 40.5% stating cross-selling opportunities as key considerations for implementing embedded services.  

Mirroring the reasons for embedding financial services, growing revenue (77%) is viewed as the primary benefit these services will deliver, followed by increasing market share (56%) and moving into new sectors (31%). 

A Director of Strategy highlighted this ability for embedded finance to drive higher revenues for a consumer goods firm: “The average order value is the biggest KPI that we're looking at. And we've seen average order value grow between 10 and 20% in the transactions that use embedded finance.”  

The question then is how much embedded finance can boost revenues.  

Most of the senior leaders we surveyed (67%) believe their organisation will see revenue growth through embedded finance, with 39% estimating between 5 and 10% growth and 21% suggesting double-digit growth of 11% and 20%. 

In my next article, I’ll examine what senior leaders view as the ideal model for implementing embedded services, any barriers they perceive and where they believe embedded finance is heading.