At its core, embedded finance—the integration of financial services into non-financial websites, mobile applications, and business processes—is a distribution strategy. Instead of offering financial services directly to consumers and small businesses, a bank offers services through a company that already has relationships with them. Why should a bank pursue this strategy? 1) Efficiency. Lower cost of customer acquisition ($5 to $35 vs. $100 to $200, according to Oliver, Wyman). 2) Returns. Banks executing embedded finance strategies produce superior ROA and ROE than other banks. Read the full article by Ron Shevlin through the link in the comments below?? #banking #digitalbanking #challengerbank #digitalbank #neobank #bankingapp #mobilebanking #bankingindustry #banks #neobanks #neobanking #bankingandfinance #baas #bankingasaservice #bankingtechnology #futureofbanking
Well said
Fintech Leader | CEO & Founder at Agora | Empowering Community Banks, Credit Unions & Fintech with our Next-Gen Modular Banking Platform
2 年Thanks for sharing Marcel van Oost, and good insights as always from Ron Shevlin. Not every baas bank sponsor are equal and will make it long term. Baas is an opportunity for banks to leverage their bank charter, but it won't fly for lot of newcomers especially with this (overweight b2c) fintech meltdown... Interesting to see one of of the oldest baas bank sponsor in the industry leading the wave CBW Bank, congrats Suresh Ramamurthi, Suchitra Padmanabhan and team.