Embedded Finance
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Embedded Finance To Pick Up the Pace as European Retailers Eye Up Solutions

Full steam ahead for embedded finance as European retailers seek to increase their offering over the course of the next 12 months. 

Fifty-six per cent of retailers surveyed by Vodeno intend to either increase their offering or start offering embedded finance solutions in the coming 12 months.

The banking-as-a-service (BaaS) provider commissioned an independent survey among 753 senior decision-makers in retail and e-commerce sectors across the UK, Germany and Belgium.

It found that 74 per cent of Europe’s retailers already offer embedded finance products to their customers. However, the UK’s 82 per cent is well ahead of Germany’s 75 per cent and Belgium’s 64 per cent.

Only five per cent of retailers which have not integrated financial products into their customer journey have no plans to do so in the next year.

Vodeno also quizzed decision-makers about which products they have implemented, and which are earmarked for investment in 2022.

Cashback through loyalty schemes, credit cards and debit cards are the most commonly offered financial products or services – a third of the retailers currently offering embedded finance solutions provide these. These were followed by current accounts and loans (both 29 per cent).

Buy now, pay later (BNPL), overdrafts and decoupled debit are set to attract the most attention from those retailers investing in embedded finance.

A vast majority of European retailers said that, in 2021, customers had indicated they would like to see financial products or services integrated into their offering. In the UK, the figure rose to 73 per cent, compared to 71 per cent and 58 per cent in Germany and Belgium, respectively.

Almost two-thirds of retail firms reported noticing more of their competitors offered embedded finance solutions in 2021. Again, this view was more prevalent in the UK (74 per cent) than in Germany or Belgium.

On a personal level, however, two in five senior decision-makers in the retail sector said they personally do not fully understand the term ‘embedded finance’.

Wojciech Sobieraj, CEO of Vodeno
Wojciech Sobieraj

Wojciech Sobieraj, CEO of Vodeno, explains: “Interest in embedded finance solutions is rising rapidly among non-financial businesses, and with good reason. Smart brands understand the value of embedded banking because they know that creating a better checkout experience will increase conversion and customer engagement. This is the promise of BaaS.

”Our research shows that Europe’s retailers recognise the embedded banking opportunity and are planning to invest. But, it is important for brands to understand that not all BaaS providers are created equal. BaaS technology must be coupled with a licence and the compliance and regulatory expertise in order to offer these products.”


  • Tyler is a fintech journalist with specific interests in online banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

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