Seamless Spending: Embedded Payments Elevating Customer Experience & Growing Revenue

In today's digital-first world, the way we pay for goods and services is undergoing a fundamental restructuring. Embedded payments, seamlessly integrated into various platforms and apps, are not just a technological advancement – they're reshaping the entire customer journey, boosting engagement, and driving business growth.

According to research by EY, payments account for the majority of revenue and growth opportunities for merchants in the embedded finance sphere with the volume of payments through embedded channels reaching US$2.5tn in 2021.

At its core, embedded payments allow customers to complete transactions without leaving the app or website they're using. This frictionless experience is proving to be fruitful for both businesses and consumers.

Here is its impact on customers online experience:?

1. Streamlined Checkout Process:

A study by Baymard Institute found that 17% of checkout abandonments occur due to a "too long/complicated checkout process." Embedded payments directly address this pain point by eliminating the need for multiple redirects or external interfaces.

2. Personalised Experiences:

With payment data integrated into the platform, businesses can offer more tailored recommendations and loyalty programs. McKinsey reports that personalisation can deliver 5 to 8 times the ROI on marketing spend and boost sales by 10% or more.

3. Expanded Payment Options:

Embedded payments allow for easy integration of various payment methods, including buy-now-pay-later options. Juniper Research predicts that by 2026, 24% of global e-commerce transactions will involve BNPL.

The impact on businesses is also substantial with companies implementing embedded payment solutions reporting:

• A 35% increase in conversion rates (Decta)
• A 40% reduction in operational costs associated with payment processing (McKinsey)
• Increased sales through higher conversions, increased basket sizes, and enhanced customer lifetime value. According to an RBC Capital Markets research report, embedded payment solutions contribute to a 20 to 30 percent increase in checkout conversion and even greater improvements in basket size (McKinsey)

However, the journey towards fully embedded payments is not without challenges. Security remains a top concern, with 69% of consumers citing it as their primary worry when using new payment technologies; our white paper published in 2024 underscores these findings with almost 20% of respondents citing the safety of their financial details as their primary concern with super-apps. Businesses must prioritise robust security measures and clear communication about data protection to build trust.

Looking ahead, the embedded payments market is set for explosive growth. Juniper Research forecasts that the total value of embedded payments is expected to grow from $32 billion in 2023 to $59 billion by 2027.?

For businesses, the message is clear: embracing embedded payments is no longer optional – it's a critical strategy for enhancing customer experience, driving engagement, and staying competitive in the digital economy.