What is embedded finance?

Embedded finance is when a non-financial organisation adds financial services - such as payments, financing and lending - into their existing product ecosystem, e.g. their website or app. These third party ‘plug and play’ services seamlessly integrate so that the user carries out their actions via one simple user journey.

Uber is one of the best examples of embedded finance in action. Users are able to book and pay for a taxi all on one app, without needing to migrate to another app to make payment. At the same time, drivers can receive payments, receipts, and even access loans and discounts all via the Uber app.

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Why is embedded finance becoming so popular?

The rise of embedded finance has been described as a revolution within the FinTech world.

Over the last few years, the growth has increased at a fast rate, especially as a result of the COVID-19 pandemic. Many services and businesses transitioned to online ways of working and created digital customer experiences, thus creating a great need to embed financial services within many non financial products.

But why has embedded finance become so popular?

As we’ve shifted towards a more digitally-focused world, our demand for better service has also increased. By integrating financial services into one user journey, businesses can better meet and satisfy their customers’ expectations.

Put simply, bringing together services that may have previously taken time and effort to access makes the whole purchase experience easier. No more switching between platforms and no more taking the time to access payment solutions that the user may not be familiar with.

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Embedded finance at work

Embedded finance services typically fall into one of the following categories:

• Embedded payments, where customers can use credit or debit cards or even digital wallets (such as our Banqup Business Wallet) to make digital purchases
• Embedded lending/financing, providing users access to different financing options such as ‘Buy Now, Pay Later’ during the online payment process

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Benefiting customers and companies

Embedded finance offers many benefits, both for consumers and businesses alike. For customers, embedded finance helps to make digital purchases quicker, simpler and more seamless.

For businesses, this helps to increase brand loyalty and eagerness to buy. In turn, this drives increased revenue while at the same time giving retailers a deeper insight into their customers’ spending habits, needs and behaviours.

Furthermore, embedded finance can help companies to automate their bookkeeping processes, potentially leading to further time and cost savings.

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Introducing embedded finance within your organisation

At Unifiedpost Group, we provide embedded finance capabilities within our digital solutions.

Billtobox provides SMEs the opportunity to pay for their invoices and bills all within their Billtobox platform. Our Billtobox embedded finance solution also goes one step further by offering small businesses the chance to finance their invoices using our embedded financing solution.

Find out more about embedded finance with Billtobox and discover how our digital invoicing, payments and admin tool can transform SME’s business processes.