The future of embedded finance

Once a buzzword, embedded finance is now a strategic necessity. As nonfinancial brands embed financial products into their ecosystems, and banks and fintechs adopt embedded financial technologies, the industry landscape continues to shift.

Today, embedded financing isn’t just about adding payments: It’s about creating integrated financial experiences that build loyalty, unlock new revenue streams and meet modern consumer expectations.

What is embedded finance?

Embedded finance integrates financial services, such as payments, lending, insurance or deposits, directly into nonfinancial platforms. Instead of visiting a bank or fintech, customers can access financial services where they already are and receive credit while purchasing an item.

Embedded financing applies this concept within a business model, offering financing or credit embedded in another service.

Learn more about the benefits of embedded finance in this video featuring Mike Kresse, SVP and division executive at FIS®.

How is embedded financing evolving in the current landscape?

The embedded financing market is accelerating, with global revenue projected to reach hundreds of billions by the end of 2025, up sharply from 2023. Momentum is driven by embedded lending, subscription-based models and deeper cross-industry partnerships.

What embedded finance technologies are driving change now?

The rise of embedded finance is fueled by technologies that simplify access to financial services.

APIs and microservices connect financial institutions with nonfinancial platforms, enabling smoother transactions. Real-time analytics enhance decision-making and personalization, while modular finance stacks let businesses add new capabilities without major overhauls.

Embedded wallets bring payments and account management directly into digital experiences, and regtech tools help ensure every interaction remains compliance and secure.

Together, these technologies are redefining how and where financial services live, moving them from standalone products to integrated experiences that meet customers where they already are.

Which industries are leading with embedded finance solutions?

Industries including retail, e-commerce, mobility, software-as-a-service, healthcare and utilities are integrating financial services directly into their user experiences. Marketplaces are following suit by integrating payments, lending and insurance services for both buyers and sellers.

What are the strategic benefits of embedded finance for brands, banks and fintechs?

Bringing financial capabilities directly to the point of need is reshaping the strategies of brands, banks and fintechs.

For brands, embedding financial services such as payments, lending or insurance directly into their customer experience increases engagement, loyalty and conversion while enabling data-driven personalization.

Banks benefit from extended reach through digital partnerships that bring their services to new audiences without building costly front-end channels.

Fintechs gain scale and speed to market by powering these embedded experiences with modular APIs and compliant infrastructure.

By meeting customers where they already are within digital marketplaces, apps and service applications, embedded finance transforms routine transactions into opportunities for value creation – driving sustained growth and more integrated financial experiences.

Which regulatory and risk factors are critical for embedded finance?

Successfully implementing embedded finance requires careful attention to regulatory and risk considerations . Organizations must comply with know your customer, anti-money laundering and licensing requirements, which often differ across regions.

Data privacy and protection are crucial, as integrating financial services into nonfinancial platforms increases exposure to sensitive customer information.

Effective fraud prevention and transaction monitoring help mitigate financial and reputational risks. Transparency in fees, terms and responsibilities also fosters trust among partners and end-users.

Equally important are sound governance structures and clear liability frameworks, which ensure accountability when financial and nonfinancial entities collaborate.

By proactively addressing these areas, organizations can deliver more seamless, secure embedded finance experiences that protect customers, satisfy regulators and build long-term trust across stakeholders.

What strategies help organizations implement embedded finance for long-term success?

Organizations can implement embedded finance in a future-ready way by designing offerings around customer needs, selecting the right partner models and applying modular technologies.

Early attention to governance, data strategies and personalization helps ensure compliance and engaging experiences. Continuous performance measurement also allows organizations to optimize outcomes and adapt as markets evolve.

What do the next 3-5 years hold for embedded finance and embedded finance technologies?

Over the next three to five years, widespread adoption of banking-as-a-service platforms will make it easier for companies to integrate financial functionality directly into their offerings.

Customers will increasingly experience personalized finance at the point of need with solutions tailored to specific industries and verticals. Ecosystems of partners, platforms and fintechs will expand, creating more interconnected and seamless experiences.

Regulatory frameworks will continue to evolve, guiding safer innovation while encouraging transparency and compliance.

Embedded finance will also play a growing role in advancing sustainability and financial inclusion , enabling businesses to deliver socially responsible products and reach underserved communities.

What are the takeaways for businesses adopting embedded finance?

Embedded finance is no longer optional: It’s foundational for modern business models.

By embedding financial services into everyday platforms, brands and financial institutions can unlock new value and meet evolving consumer expectations.

Success depends on seamlessly integrating embedded finance with leading-edge technologies, sound governance and a strong focus on user experience.