The majority of European brands that are looking to transition into embedded finance will debut with an embedded payments offering, according to a recent report by the BaaS platform OpenPayd.
These are the primary findings of the company’s recent report, which also found how 73 per cent of European brands are planning on launching some kind of embedded finance service over the course of then the next two years, with embedded payments becoming the mechanism of choice to do so.
96 per cent of the companies surveyed stated that they were planning to offer embedded payments to customers in the next five years or are seriously considering doing so, overtaking neighbouring offerings such as embedded banking (94 per cent), short-term lending (69 per cent) and embedded insurance (69 per cent).
In total, embedded payments services are expected to generate revenue of €277.46billion in Europe over the next five years. Brands are already investing heavily in embedded payments with 22 per cent having embedded payments in development and three quarters expecting to take products to market within the next two years.
This research on embedded payments reveals some detail about implementation too, with businesses pinpointing one key success factor in rolling out embedded payments – curating customers’ journeys.
According to the brands surveyed, the three most appealing aspects of embedded finance are:
- Retaining the front-end customer experience (85 per cent)
- Increasing the number of customers touchpoints with their brand (84 per cent)
- Offering mobile wallet or current account options to customers (79 per cent)
“Embedded payments deliver the convenience consumers expect by seamlessly fitting into the checkout process. Merchants are using embedded payments to transform what was a strictly functional payment process into a personalised, intuitive experience,” said Iana Dimitrova, Chief Executive at OpenPayd.
“What will drive this change will be the collaboration between those brands that want to provide embedded payment solutions and the technology companies that can help build them. The market is quickly being established and we’re already seeing the appetite from businesses and consumers – the time is now for brands to leverage embedded payments.”
Continue reading: The retail, health and education sectors are the most likely to uptake embedded finance.