Global Embedded Finance Business and Investment Opportunities Databook – 75+ KPIs on Embedded Lending, Insurance, Payment, and Wealth Segments - Q2 2024 Update

Global Embedded Finance Business and Investment Opportunities Databook – 75+ KPIs on Embedded Lending, Insurance, Payment, and Wealth Segments - Q2 2024 Update

According to PayNXT360, Global embedded finance industry is expected to grow by 12.5% annually to reach US$164,361.2 million in 2024.

The embedded finance industry is expected to grow steadily over the forecast period, recording a CAGR of 26.6% from 2024 to 2029. The global embedded finance revenues will increase from US$164,361.2 million in 2024 to reach US$533,960.4 million by 2029.

The embedded finance sector has experienced significant growth globally, driven by product innovations, strategic partnerships, and mergers and acquisitions. Regulatory changes have also shaped the industry, emphasizing consumer protection and compliance. As the sector evolves, further advancements in embedded insurance, investment services, and cross-border expansion are expected, transforming how businesses and consumers interact with financial services.

Growth in the Embedded Finance Sector Global

Embedded finance has seen significant growth over the past few months, driven by the increasing integration of financial services into various sectors such as retail, healthcare, and e-commerce. Key sub-segments like embedded payments and lending are expanding rapidly, with businesses leveraging API technology to enhance customer experiences and streamline transactions.

In the coming few months, this trend is expected to continue, with further innovations and partnerships emerging, particularly in areas like embedded insurance and investment services, as companies seek to provide seamless financial solutions within their platforms.

Key Developments in the Embedded Finance Sector

Product Launches and Innovations

Plaid's Enhanced API Offerings: Plaid has expanded its API suite to facilitate the integration of financial services into non-financial platforms, enabling companies to offer a wider range of financial products directly within their applications.

Shopify's Payment Solutions: Shopify introduced new features that streamline payment processes for merchants, including enhanced ""buy now, pay later"" options, which have significantly improved conversion rates and average order values.

Nium's Global Expansion: Nium launched embedded finance solutions that allow businesses to integrate services like digital wallets and payment processing, catering to the demand for seamless financial transactions.

Liberis Embedded Finance Platform: Liberis launched a platform aimed at small businesses, providing personalized financing solutions powered by machine learning and AI analytics, integrating with various business applications.

RBC's Digital Banking Solutions: The Royal Bank of Canada introduced new embedded banking features within its digital platforms, allowing users to access loans and payment solutions directly through e-commerce sites and mobile applications.

Wealthsimple's Integrated Investment Tools: Wealthsimple expanded its offerings by launching embedded investment tools that enable users to manage investments directly within partner platforms, enhancing accessibility to investment services.

Strategic Partnerships

Visa and Fintech Collaborations: Visa has been actively engaging with various fintech companies to enhance embedded finance solutions, particularly in payment processing and lending services. These partnerships aim to leverage Visa's extensive network to provide seamless financial services across different platforms.

Stripe and E-commerce Platforms: Stripe has strengthened its collaborations with e-commerce platforms, enabling merchants to integrate payment solutions directly into their checkout processes. This integration enhances user experience and facilitates smoother transactions for online shoppers.

RBC and Non-Banking Platforms: The Royal Bank of Canada (RBC) has partnered with non-banking platforms to embed banking services directly into their ecosystems, allowing users to access loans and payment solutions seamlessly through various digital channels.

Nium and Global Businesses: Nium has formed partnerships with businesses across different sectors to provide embedded finance solutions, including digital wallets and payment processing capabilities, catering to the growing demand for integrated financial services.

Mergers and Acquisitions

Mitgo Group Acquires Embedded - In March 2024, Mitgo Group, a German marketing technology provider, announced the acquisition of the UAE-based embedded finance platform, Embedded. This acquisition aims to enhance Mitgo's capabilities in providing embedded finance solutions to its affiliate customers, allowing the company to enter the fintech market effectively.

Moniepoint Acquires Kopo Kopo - In late 2023, Nigerian fintech giant Moniepoint acquired Kopo Kopo, a Kenyan payment solutions provider. This acquisition aims to diversify Moniepoint's portfolio and expand its regional presence, enhancing its capabilities in providing embedded finance solutions across Africa.

Regulatory Changes

1. Increased Federal Guidance and Oversight: Regulators have issued landmark guidance, such as the Novel Activities Supervision Program and Interagency Guidance on Third-Party Relationships, leading to a more cautious approach in the embedded finance and Banking-as-a-Service (BaaS) sectors. Banks are now required to manage fintechs with the same rigor as bank vendors, and the costs of governance are expected to increase for tech firms.
2. Consumer Duty Regulations: New regulations, such as consumer duty, require companies to ensure that their products and services are clearly understood by consumers. This involves transparent communication about pricing, product features, and potential risks. While this may slow down the innovation process, it ultimately leads to better consumer protection and trust.
3. Collaboration with Regulators: Companies are working closely with regulators to navigate the complexities of compliance. Understanding regulatory requirements and finding innovative ways to meet them without stifling growth is essential. Leveraging advanced technologies for identity verification and risk assessment can help bridge the gap between innovation and regulation.
4. Cross-Border Regulatory Challenges: For companies expanding globally, operating across different regulatory environments poses challenges. Knowing which regulatory requirements apply in each region is crucial. Collaboration with tech providers and distributors is essential to ensure compliance without stifling innovation.

This report offers a comprehensive, data-centric analysis of the embedded finance industry. It covers lending, insurance, payment, wealth and asset-based finance sectors and provides a detailed breakdown of market opportunities and risks across various sectors. With over 75+ KPIs at the country level, this report ensures a thorough understanding of embedded finance market dynamics, market size, and forecast.

It breaks down market opportunities by type of business model, consumer segment, and distribution model. In addition, it provides detailed information across various segments in each sector of embedded finance. KPI revenue helps in getting an in-depth understanding of end market dynamics.

PayNXT360's research methodology is based on industry best practices. Its unbiased analysis leverages a proprietary analytics platform to offer a detailed view of emerging business and investment market opportunities.

Scope

This report provides regional insights, along with an in-depth data centric analysis of the Embedded Finance industry in the Asia Pacific, covering 50+ KPIs for each region and country (650+ charts and 500+ tables in all). Below is a summary of key market segments:

Embedded Finance Market Size and Forecast

• Embedded Finance by Key Sectors
Retail
Logistics
Telecommunications
Manufacturing
Consumer Health
Others

• Embedded Finance by Business Model
Platforms
Enabler
Regulatory Entity

• Embedded Finance by Distribution Model
Own Platforms
Third Party Platforms


Embedded Insurance Market Size and Forecast

• Embedded Insurance by Industry
Embedded Insurance in Consumer Products
Embedded Insurance in Travel & Hospitality
Embedded Insurance in Automotive
Embedded Insurance in Healthcare
Embedded Insurance in Real Estate
Embedded Insurance in Transport & Logistics
Embedded Insurance in Others

• Embedded Insurance by Consumer Segments
B2B
B2C

• Embedded Insurance by Type of Offering
Embedded Insurance in Product Segment
Embedded Insurance in Service Segment

Embedded Insurance by Business Model
Platforms
Enabler
Regulatory Entity

• Embedded Insurance by Distribution Model
Own Platforms
Third Party Platforms

• Embedded Insurance by Distribution Channel
Embedded Sales
Bancassurance
Broker’s/IFA’s
Tied Agents

• Embedded Insurance by Insurance Type
Embedded Insurance in Life Segment
Embedded Insurance in Non-Life Segment

• Embedded Insurance in Non-Life Segment
Motor Vehicle
Fire and Property
Accident and Health
General Liability
Marine, Aviation and other Transport
Other

Embedded Lending Market Size and Forecast

• Embedded Lending by Consumer Segments
Business Lending
Retail Lending

• Embedded Lending by B2B Sectors
Embedded Lending in Retail & Consumer Goods
Embedded Lending in IT & Software Services
Embedded Lending in Media, Entertainment & Leisure
Embedded Lending in Manufacturing & Distribution
Embedded Lending in Real Estate
Embedded Lending in Other

• Embedded Lending by B2C Sectors
Embedded Lending in Retail Shopping
Embedded Lending in Home Improvement
Embedded Lending in Leisure & Entertainment
Embedded Lending in Healthcare and Wellness
Embedded Lending in Other

• Embedded Lending by Type
BNPL Lending
POS Lending
Personal Loans

• Embedded Lending by Business Model
Platforms
Enabler
Regulatory Entity

• Embedded Lending by Distribution Model
Own Platforms
Third Party Platforms

Embedded Payment Market Size and Forecast

• Embedded Payment by Consumer Segments
B2B
B2C

• Embedded Payment by End-Use Sector
Embedded Payment in Retail & Consumer Goods
Embedded Payment in Digital Products & Services
Embedded Payment in Utility Bill Payment
Embedded Payment in Travel & Hospitality
Embedded Payment in Leisure & Entertainment
Embedded Payment in Health & Wellness
Embedded Payment in Office Supplies & Equipment
Embedded Payment in Other

• Embedded Payment by Business Model
Platforms
Enabler
Regulatory Entity

• Embedded Payment by Distribution Model
Own Platforms
Third Party Platforms


Embedded Wealth Management Market Size and Forecast

Asset Based Finance Management Industry Market Size and Forecast
• Asset Based Finance by Type of Asset
Hard Assets
Soft Assets

• Asset Based Finance by End Users
SME’s
Large Enterprises

Reasons to buy

• In-depth Understanding of Embedded Finance Market Dynamics: Understand market opportunities and key trends along with forecast (2019-2028).

• Insights into Opportunity by end-use sectors – Get market dynamics by end-use sectors to assess emerging opportunity across various end-use sectors.

• Develop Market Specific Strategies: Identify growth segments and target specific opportunities to formulate embedded finance strategy; assess market specific key trends, drivers, and risks in the industry.

• Get Sector Insights: Drawing from proprietary survey results, this report identifies opportunities across embedded lending, embedded insurance, embedded finance, and embedded wealth sectors.

•Get insights at segment level, by the distribution model and by business model in key embedded finance segments

•Insights into the asset based finance market size and by type of assets, by end users.