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Premium Report Details
Base Year: 2024
Companies covered: 20
Tables & Figures: 200
Countries covered: 21
Pages: 180
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Embedded Finance Market
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Embedded Finance Market Size
The global embedded finance market size was valued at USD 104.8 billion in 2024 and is projected to grow at a CAGR of 23.3% between 2025 and 2034. The rapid adoption of digital payments across consumer and business segments is driving the growth of embedded finance. Consumers now expect integrated payment solutions in everyday activities, prompting businesses to embed financial services into their platforms.
For instance, according to Federal Reserve, in 2023, general-purpose (GP) card payments recorded 153.3 billion transactions, amounting to USD 9.76 trillion across the U.S. From 2021 to 2022, transaction volumes grew by 6%, while value increased by 10.5%, sustaining consistent growth. The widespread use of mobile wallets, contactless payments, and increasing digital transaction adoption across demographics has created a conducive environment for embedded finance.
Advancements in Banking-as-a-Service (BaaS) platforms have lowered entry barriers for non-financial companies to offer financial services. These platforms provide ready-to-use infrastructure, compliance frameworks, and APIs, enabling businesses to integrate financial services without building infrastructure from scratch. This accessibility has made embedded finance a viable option for companies of all sizes.
Embedded Finance Market Trends
Buy Now, Pay Later (BNPL) services are transitioning from basic point-of-sale financing to more advanced financial solutions and applications. The adoption of BNPL is accelerating across industries such as healthcare, education, and B2B transactions. Leveraging advanced analytics and artificial intelligence, providers are enhancing credit assessment accuracy and offering personalized payment terms. This growth is driven by evolving consumer preferences and the increasing demand for flexible payment options.
For instance, in September 2024, Mondu's integration with Stripe enables B2B merchants and marketplaces to offer buy now, pay later (BNPL) options within their existing Stripe setup. This solution provides sellers with risk-free upfront payments while offering buyers flexible payment terms, driving higher sales and order values.
The increasing integration and distribution of financial services have expanded the potential attack surface for security breaches and fraud. Organizations must allocate substantial resources to implement advanced security measures, deploy fraud detection systems, and conduct regular security audits. The involvement of multiple partners and services introduces additional vulnerabilities that require proactive management. The escalating complexity of cyber threats and fraud attempts underscores the need for continuous monitoring and timely updates to security protocols.
Embedded Finance Market Analysis
Based on the service, the market is segmented into payments, insurance, investment, lending, and banking. In 2024, the embedded payment segment accounted for over 45% of the market share and is expected to exceed USD 400 billion by 2034. Embedded finance is undergoing significant transformation with the integration of DeFi (decentralized finance) solutions, enabling platforms to deliver blockchain-based financial services such as cryptocurrency payments, lending, and staking. This innovation eliminates reliance on traditional banking intermediaries, appealing to tech-savvy consumers while driving financial inclusion in underserved markets.
Moreover, advanced AI technologies are facilitating hyper-personalized payment offerings across platforms. By leveraging user data, AI delivers tailored solutions, including insurance, credit products, and savings plans. Key industries such as agriculture, real estate, and logistics are adopting customized embedded finance solutions. For instance, AgriTech platforms provide embedded credit lines for farmers, while PropTech platforms integrate mortgage solutions. This targeted approach not only unlocks new market opportunities but also addresses the specific requirements of individual sectors.
Based on the end use, the embedded finance market is divided into retail, healthcare, logistics, manufacturing, travel & entertainment, and others. By 2034, the retail segment is expected to exceed USD 270 billion due to several key factors. Embedded finance is transforming loyalty programs by integrating financial products with customer rewards. Retailers are adopting digital wallets and co-branded credit cards that offer redeemable points for discounts or cashback, enhancing customer engagement and providing insights into spending patterns.
For instance, Starbucks links its rewards program with a prepaid card through its app, creating a unified spending and rewards system. This approach drives repeat purchases and strengthens brand loyalty.
Retailers are also embedding insurance options at checkout for products like electronics, furniture, and travel bookings. This simplifies the insurance process, improves customer experience, and generates additional revenue. Companies like Cover Genius partner with e-commerce platforms to offer product-specific policies, meeting consumer demand for convenience and enabling cross-selling opportunities. The resulting data helps retailers optimize product offerings and pricing strategies.
The U.S. embedded finance market accounted for over 85% of the revenue share in 2024. Traditional banks are transforming digital platforms into financial ecosystems by integrating non-financial services. Partnerships with retailers, travel companies, and lifestyle providers enable features like shopping, booking, and entertainment within banking apps. This strategy enhances customer retention and generates revenue through commissions and data monetization. Large national banks, leveraging robust infrastructure and customer bases, report significant growth in engagement from these services.
European merchants are utilizing open banking to embed advanced Buy-Now-Pay-Later (BNPL) solutions into purchase journeys. Real-time banking data improves credit assessments and customizes payment plans. This trend is prominent in the UK and Nordic regions, where regulatory frameworks and standardized APIs streamline collaboration among merchants, banks, and BNPL providers.
Social media and messaging platforms are integrating financial services into commerce features, including payment processing, merchant financing, and consumer credit for social commerce. This trend is significant in markets like Thailand, Vietnam, and the Philippines, where social commerce drives online retail. Platforms report higher transaction rates and increased order values with these integrations.
Embedded Finance Market Share
PayPal, Stripe, and Shopify collectively held a substantial market share of over 18% in the embedded finance industry in 2024. PayPal is building a robust ecosystem through acquisitions, partnerships, and product innovation. By acquiring Honey and Venmo, it integrates payments with shopping and peer-to-peer transfers. Investments in cryptocurrency services and global partnerships with e-commerce platforms enhance its market presence. The company prioritizes trust, security, and adaptability to trends like embedded finance to maintain its leadership in digital payments.
Stripe focuses on developer-friendly APIs and tools to simplify payment integration for businesses of all sizes. Its infrastructure supports over 135 currencies and localized payment methods, driving global expansion and cross-border commerce. Strategic investments in fraud detection (Radar), billing, and financing strengthen its service portfolio.
Shopify integrates financial services into its e-commerce platform, offering tools like Shopify Payments, Capital, and Balance to streamline payments, funding, and financial management for merchants. Its vertical integration strategy, supported by data insights and partnerships with Stripe and PayPal, enhances customer experience and drives growth. A subscription-based revenue model ensures long-term profitability.
Embedded Finance Market Companies
Major players operating in the embedded finance industry are:
Embedded Finance Industry News
The embedded finance market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue ($ Mn/Bn) from 2021 to 2034, for the following segments:
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Market, By Service
Market, By Business Model
Market, By End Use
The above information is provided for the following regions and countries: