With its ability to drive additional revenue for businesses, more and more players are integrating customized banking and credit solution into their core product offering. Over the last 12 months, the trend has accelerated significantly, and therefore, many firms are betting on the embedded finance sector. The growing number of acquisition and fund-raising deals proves that the embedded finance sector is hotter than ever before.
The credit card issuance program, the first product for Power Finance, has been designed to provide banks and brands the ability to offer embedded financial experiences to their customers. With the acquisition of Power Finance, the first goal for Marqeta is to expand the capabilities of the credit product. Furthermore, the acquisition will also enable Marqeta’s customers to launch credit products embedded into their own offerings.
Along with acquisitions, the multi-million-dollar deals secured by embedded finance provider also shows the growth potential of the sector from the short to medium-term perspective. Globally, many of the leading and emerging embedded finance firms have raised venture capital and private equity rounds.
Along with the United States and European markets, the embedded finance sector is also gaining strong momentum in the Asia Pacific region. In India, RATNAAFIN, the non-banking institution, partnered with Singapore-headquartered actyv.ai to provide embedded lending services to MSMEs in the country. In January 2023, actyv.ai, the B2B embedded BNPL provider, also raised US$7 million to fund its global expansion.
With the sector projected to record strong growth in the Southeast Asian market, global firms are also expanding their presence in Singapore. Weavr, for instance, announced that the firm is launching operations in Singapore to bring its services to digital platform businesses in the country. The Plug-and-Play Finance solution offered by the firm will further drive the competitive landscape in the Singaporean embedded finance industry.
As embedded finance continues to pick up steam among banks and non-banks, who are looking at it as a way to broaden their relationship with consumers, PayNXT360 expects the trend of acquisitions and fund-raising to further accelerate in the global embedded finance market from the short to medium-term perspective. This will keep driving the growth of the overall market over the next three to four years.
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