Embedded Finance : A Revolution You Can’t Afford to Ignore

Embedded finance refers to the integration of financial services such as payments, loans, insurance, or savings accounts directly into non-financial platforms, whether e-commerce applications, marketplaces, or mobility services.

This approach transforms the customer experience by making financial services simpler, smoother, and more accessible. For non-financial companies, it also represents a way to broaden or complement their offering by providing high-value-added services directly embedded in their customer journey. For financial institutions and SMEs, it is a major opportunity to expand their reach, innovate through models such as Banking-as-a-Service (BaaS), and address new customer needs through an API-first and collaborative approach.

In a fast-growing market, embedded finance is redefining relationships between financial players, technology partners, and end-users, ushering in a new era of more integrated, agile, and customer-centric services.

Why is embedded finance a revolution?

Embedded finance is profoundly transforming the way financial services are consumed. Historically, accessing a bank account, taking out a loan, or purchasing insurance required going through dedicated channels: physical branches, banking apps, or specialized websites. With embedded finance, these services now seamlessly integrate into users’ daily lives, at the moment and place where they are needed.

A leading example of embedded finance in accounting, Pennylane is reshaping how businesses manage money first in France and expanding across Europe. Through its platform, users can handle payments, track cash flow, and access financial services effortlessly. The fintech now collaborates with 4,500+ accounting firms, supports 350,000+ businesses, and was valued at €2 billion after a €75 million funding round in 2025.

Another French example of embedded finance in accounting is Tiime, which integrates payments, invoicing, and expense management directly into its platform for small businesses and accountants. Fully self-funded, the company now serves over 300,000 users and generated €32 million in revenue in 2023, growing by nearly 50 % year over year. Tiime exemplifies how embedded financial tools can simplify day-to-day operations for SMEs while strengthening collaboration with accounting partners.

For financial institutions, this represents a true revolution in both role and positioning. They are no longer merely providers of financial products but also technology partners of the platforms hosting their services and innovation enablers for an entire ecosystem. Finance thus shifts from the center (the bank) to the point of use (the customer and their preferred platform), creating a new paradigm where value is distributed more broadly and intelligently.

A fast-growing market

The embedded finance market is experiencing exceptional growth, with projections ranging from several hundred billion to over one trillion dollars by the end of the decade. According to Grand View Research, it is expected to grow from USD 83.3 billion in 2023 to USD 588.5 billion in 2030 worldwide.

According to a study by Adyen and Boston Consulting Group, the embedded finance market has a total addressable size of US $185 billion, of which only US $32 billion has been captured so far, while for Europe the estimated TAM stands at roughly US $72 billion.

A. Growth driven by payments, accounts and consumer credit

While embedded finance is expanding across many sectors, three segments are particularly driving the growth:

Integrated payments: They currently account for the largest share of the market. Whether through digital wallets or solutions embedded in e-commerce, these services address the immediate and widespread demand of consumers.

Accounts: Embedded accounts are emerging as a key growth driver in embedded finance. By allowing businesses and consumers to hold and manage funds directly within a platform, they enable integrated services such as SEPA Credit Transfers (SCT) and SEPA Direct Debits (SDD). These embedded accounts simplify money-in and money-out flows from salary payments to recurring bills while offering platforms new revenue streams through deposit-related services and transaction fees.

Consumer credit: Directly integrated into the purchasing journey (e.g., financing an e-commerce basket or point-of-sale credit), it attracts customers thanks to its simplicity and speed. For both retailers and banks, it is an effective way to build loyalty and acquire new clients.

B. Huge potential in savings, insurance, and investment

While payments and credit currently dominate the embedded finance market, other segments are set to experience major growth in the coming years:

Savings: Directly integrated into payment or budgeting apps, savings features allow users to automatically set aside part of their transactions or income. This simplicity encourages adoption and fosters new financial habits.

Insurance: Already visible in areas such as mobility and travel, embedded insurance is expected to grow rapidly. Offering contextual and immediate coverage at the time of purchasing a product or service simplifies the process and enhances the perceived value for the customer.

Investment: Through commerce or payment apps, users can access investment services (stocks, ETFs, crypto, retirement savings) without going through a dedicated platform. This integration democratizes access to financial products that were previously reserved for more sophisticated investors.

3. Keys to Success for Financial Institutions

In the face of the rise of embedded finance, financial institutions must rethink their models to remain competitive. Rather than competing directly with fintechs or platforms, banks can position themselves as product providers within this new ecosystem, offering regulated financial products and infrastructure, while non-financial companies act as distributors, embedding these products directly into their user journeys.

This new model requires a shift from a closed, product-centric approach to an open, collaborative, and API-driven ecosystem. Success relies on several strategic levers:

Adopt an API-first approach and modular architecture

Open APIs and modularity enable the rapid integration of new services. To achieve this effectively, institutions can rely on specialized fintech partners such as Skaleet, whose core banking solution offers a cloud-native and interoperable architecture.

Develop customer-centric products

The success of embedded finance depends on a deep understanding of user behaviors. Services must be designed to integrate seamlessly into the customer journey, without friction, in order to deliver a smooth and intuitive experience.

Example: Cdiscount & Oney

On the e-commerce site Cdiscount, customers can choose to pay for their purchases in installments thanks to Oney’s embedded credit solution. This option is offered directly at checkout, in just a few clicks, without the need to open a new interface or contact a bank.

With Cdiscount generating over €4 billion in revenue and Oney serving nearly 7 million customers in France, this partnership exemplifies the rapid expansion of the embedded finance market.

Foster agile innovation and a culture of collaboration

Financial institutions must be able to test, adjust, and deploy new solutions quickly. Collaboration with fintechs, retail players, or digital platforms is becoming a key factor in accelerating innovation and generating shared value.

Explore emerging models such as Banking-as-a-Service (BaaS)

BaaS paves the way for new business models, where non-financial players can offer integrated banking services.

💡Skaleet is not a BaaS, but its SaaS platform provides the technological building blocks that enable banks and fintechs to build such models, in partnership with vertical SaaS platforms. 

Preparing for AI integration

According to BCG, artificial intelligence will play a decisive role in the future of embedded finance. By leveraging real-time transaction data, institutions will be able to deliver proactive and contextualized financial services, such as offering cash-flow credit at the right moment, insurance tailored to a specific transaction, or even generating automated investment recommendations. Looking ahead, embedded finance providers must prepare for a world where AI agents mediate search, discovery, and even purchasing decisions. This means integrating agentic AI within their own platforms and customer journeys, ensuring that financial services remain accessible and adaptive within AI-assisted digital ecosystems. 

4. The Importance of Collaboration

The rise of embedded finance is built on a fundamental principle: no player can succeed alone. Value is created through the ability to build strong partnerships between banks, fintechs, and digital platforms.

Banks bring regulatory expertise, financial strength, and credibility with customers. Fintechs and technology providers, such as Skaleet, deliver agile and modular infrastructures that enable rapid innovation. Finally, platforms (e-commerce, mobility, vertical SaaS, etc.) act as distribution channels by embedding these services directly into the daily journeys of consumers and businesses.

This collaboration generates tangible benefits:

• Cost reduction: through shared infrastructures and pooled expertise.

Example: By using Klarna’s BNPL infrastructure and expertise, merchants are able to grow their business without having to develop those competencies on their own.

• Accelerated innovation: by combining the creativity of fintechs with the scale and strength of financial institutions.
• Greater agility: by deploying new offerings faster and more efficiently.
• New revenue streams: for SaaS platforms and financial institutions, integrated financial services are becoming a major driver of growth. According to Matt Brown, partner at Matrix Partners and a leading voice on embedded finance, some platforms already derive around half of their revenues from embedded financial products.

But this collaborative dynamic also comes with challenges that must be addressed:

• Clear governance to define responsibilities.
  
  
• Strict management of security and sensitive data.
  
  
• Strategic alignment between players with different cultures and objectives.

Skaleet, Powering the Future of Embedded Finance 🚀

Skaleet: Enabling Every Embedded Finance Operating Model

Embedded finance opens up multiple paths for innovation, and Skaleet is designed to empower those looking to launch and scale. Depending on their strategy, partners, and regulatory ambitions, institutions can choose different operating models to bring embedded finance to life.

1. All-in-One BaaS Model: Quick to Launch, Limited Control
   At the early stage of their journey, some companies start with an All-in-One BaaS approach. This model provides an integrated, ready-to-use financial stack that can allow fast market entry. However, margins and operational control are often limited since financial and technical components, from KYC/KYB onboarding and pricing to “ownership” of the end customer, are shared with the BaaS provider. Skaleet offers a path for institutions to easily evolve beyond this stage when they are ready to scale and gain autonomy.
   
   
2. Unbundled License-as-a-Service: Growing Control and Differentiation
   As organizations mature, they can transition toward an Unbundled License-as-a-Service model, where a licensed entity combines a core banking platform (like Skaleet’s) with a curated ecosystem of best-of-breed partners, for example, card processors, AML/KYC providers, or SEPA rail integrators. This hybrid model enables greater flexibility, better cost efficiency, and improved customer ownership, while maintaining regulatory simplicity through shared licenses. Skaleet’s API-first architecture is built precisely to orchestrate these modular ecosystems with agility and interoperability.
   
   
3. Regulatory License + Best-of-Breed Ecosystem: Full Control and Scalability
   At full maturity, institutions may pursue their own regulatory license, leveraging Skaleet’s SaaS core banking platform to integrate an ecosystem of specialized fintech and compliance partners. This model delivers maximum control, full ownership of the customer relationship, and optimized margins, essential for scaling financial services sustainably. Skaleet’s composable technology stack supports this evolution by allowing institutions to progressively add functionalities, partners, and geographies without disrupting operations.

The Skaleet Advantage

With its cloud-native, API-first, and modular core banking solutions, Skaleet enables banks, fintechs and corporates to choose their ideal operating model, from rapid market entry to full regulatory independence. By combining technological agility, ecosystem interoperability, and regulatory adaptability, Skaleet empowers players to shape the embedded finance revolution on their own terms enabling innovation today and scalability tomorrow. 

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