Finance
Embedded finance: the next big thing in commerce?
Published by Jessica Weisman-Pitts
Posted on November 8, 2021
4 min readLast updated: January 28, 2026
Global Banking & Finance Review®
Company
Published by Jessica Weisman-Pitts
Posted on November 8, 2021
4 min readLast updated: January 28, 2026
Embedded finance is reshaping commerce, with UK firms leading adoption. Talent shortages and partnerships are key challenges.
By Iana Dimitrova, CEO, OpenPayd
Ask anyone in fintech what’s on their list of the next big disruptors in finance and they’ll probably say embedded finance. Ever since Angela Strange proclaimed “every company will be a fintech company” back in 2019, companies have been on a mission to find new ways to offer payments, banking, lending and insurance services through fintech. The most prominent examples being the ‘buy now, pay later’ options offered at checkouts in ecommerce stores or embedded banking services such as Shopify Balance.
But is embedded finance really a big deal to those outside the hype-laden fintech bubble? And what are C-suite decision makers across the UK and Europe really looking for in an embedded finance offering? To answer those questions, OpenPayd recently commissioned the largest ever independent study of attitudes towards embedded finance, surveying 150 decision makers from companies across Europe for a much-needed perspective from outside the fintech bubble. What we uncovered is an overlooked perspective on the future of embedded finance in Europe.
Excitement doesn’t equate to preparedness
One of the more striking insights from the research is that the buzz surrounding embedded finance is no longer confined to the fintech universe: it’s mainstream. Every company we surveyed said they are aware of the term ‘embedded finance’. It is on the agenda of boardroom discussions across Europe, as senior leaders look to build smoother customer journeys and new ways to add value to the customer experience.
The driving force of this interest in embedded finance is the eagerness to capitalise on changing consumer habits. Customer demand was a top reason driving companies to roll out embedded finance services, reflecting a post-pandemic appetite for seamless, digital-first user journeys.
UK firms are among the continent’s early adopters. Over 10% of companies have launched embedded finance propositions and more than a third expect to launch embedded financial services in the next year, more than any other European country. In total UK companies expect to generate £230.48 billion from embedded financial services, 37% of the £619 billion (€720 billion) total for European brands.
What’s holding them back?
Fintech talent has already been hard to come by over the last few years. The expertise shortage will get even tighter with two thirds (67%) of all companies planning to build internal fintech teams to develop their embedded finance offerings.
There are a few ways companies can address the issue. At the heart of any solution will be diversity and inclusion. When you’re trying to build new software solutions for a diverse group of end customers, it helps to be diverse by design. Partnering with educational institutions to deliver training, running apprenticeships and offering mentoring in the workplace are all good ways for companies to get started with identifying and developing underrepresented talent to start building an internal fintech team.
Another challenge facing companies is finding the right operational support to build and scale a fintech proposition. There’s a lot for companies to wrap their heads around as they build new teams and partner with third-party embedded finance providers. Business leaders are now looking carefully at the technology, scale, licences and talent that their infrastructure partners can bring to the table to support their embedded finance projects. Industry expertise, the ability to grow revenue and implementation speed are the top reasons companies are choosing to partner with third-party infrastructure providers.
Blazing the embedded finance trail
The UK has long been a world leader in financial services. Now it’s leading the charge into embedded financial services. Cashless payments already outpace cash and soon conventional banking players too will be overtaken by white-label banking, lending and insurance services.
No matter what companies are planning, brands will need help accessing the fintech skill they require to put embedded finance propositions in place and navigate increasingly complex regulations. We’ve only scratched the surface of the huge, unmet demand for embedded finance across Europe – the next two years will be transformative.
The full report Embedded finance surge to net €720bn for European brands by 2026 can be downloaded here.
The article discusses the rise of embedded finance in commerce and its impact on the financial industry.
Embedded finance offers seamless, digital-first user journeys, meeting changing consumer demands post-pandemic.
Companies face a fintech talent shortage and need operational support to build and scale their offerings.
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