Report: Demystifying Embedded Finance for Banks and Processors

The traditional banking model is not dead yet. But in the meantime, the payment ecosystem is opening up, and new business models based on embedded finance are taking shape.

Celent, a leading industry research and advisory firm focused on technology for financial institutions, recently has conducted research to find out what embedded finance means for banks and processors and how they can find their place in it. OpenWay, a top-ranked digital banking and payments software provider, believes the resulting report is highly relevant to our partners and aims to make it available to a larger audience.

This report addresses key points on the topic of embedded finance:

• What embedded finance is and what it is not

• Five leading strategies for banks to engage with embedded finance

• BaaS, marketplaces, open banking: new business models and how to enable them

• Opportunities and potential risks of opening your services via third parties

• Technology for embedded finance: how companies like OpenWay can help

Rob Manderson, Director of Partnerships at OpenWay, interviewed Zil Bareisis, one of the report authors, about the main report findings.

Licensed financial institutions mentioned in the report include:

Ant Financial, Banco Davivienda, Barclays, BBVA, BNP Paribas, CBW Bank, Citi, comdirect Bank AG, Cross River Bank, DBS Bank, Evolve Bank and Trust, Fidor Bank, Goldman Sachs, Green Dot Bank, Huntington National Bank, JB Financial Group, Lincoln Savings Bank, Monzo, NatWest, Paytm Payments Bank, PNC, Revolut, RBC, Seattle Bank, SFCU, Société Générale, Solarisbank, Standard Chartered, Starling Bank, Sutton Bank, TD Bank, The Bancorp Bank, WebBank, Wells Fargo, Westpac, Yes Bank

Fintechs, enterprises, and technology firms mentioned in the report include:

OpenWay, 10x, Affirm, Afterpay, Apple, Autobooks, Beam, BitStocks, Bond, Branch, Chime, Dave, Deserve, Doordash, Empower, Facebook, Finastra, Galileo, Google, i2c, Jack Henry & Associates, Klarna, LightningAid, Mambu, Marqeta, Modulr, MoneyLion, MuchBetter, Netflix, Nium, PayKey, PayPal, PelicanPay, Plaid, Plum, Railsbank, Raisin, Sage, Shopify, SocietyOne, SoFi, Stripe, Synapse, Telefonica Germany, Temenos, Tesco, Thought Machine, Treezor, TrueLayer, Uber, Xero

Sample figure from the report:

Embedded finance is one of four new major models of how banks can participate in an increasingly open financial services ecosystem.

OpenWay, the top-ranked provider of digital payment software, helps banks and processors develop and launch their own embedded finance offering for fintechs, PSPs, retailers, or neobanks. The report is produced by Celent, the leading research and advisory firm focused on technology for financial institutions globally.