Europe Embedded Banking Market

With BaaS Becoming a Megatrend within the Financial Sector, find out with FMI What Makes Europe a Hotbed for Embedded Banking Companies!

Europe Embedded Banking Market by Solution, Organization Size, End User & Region | Forecast 2023 to 2033

Europe Embedded Banking Market Outlook (2023 to 2033)

In 2023, the Europe embedded banking market generated total revenue of US$ 4,395.3 million. Over the next decade (2023 to 2033), Europe embedded banking demand is likely to rise at 23.5% CAGR. By 2033, Europe embedded banking market size is expected to reach around US$ 36,377.9 million.

Europe embedded banking industry currently holds around 23% of the global embedded banking market. This figure is likely to further increase amid rising adoption of embed banking solutions by end users.

Key Factors Shaping Europe Market:

Rising popularity of embedded banking platform application programming interfaces (APIs) will boost the Europe market
Rapid penetration of digitalization is set to create a conducive environment for the development of embedded banking industry in Europe
Growing focus on improving customer experience is expected to fuel embedded banking demand
Integrating embedded banking solutions with advanced technologies such as artificial intelligence, internet of things and machine learning will positively influence the market
Robust growth of e-commerce will create lucrative opportunities for embedded banking service providers
Favorable government policies and initiatives to stimulate market expansion.
Innovations in technology and changes in regulations such as PSD2 (payment service directive) will open new opportunities for embedded baking solution providers
Increasing acceptance of UPI payments and rising popularity of concepts such as SME lending, consumer lending, and insurance will boost the market
Surging demand for new finance technologies is expected to boost sales through 2033

Integration of financial solutions, software and services with business platforms or apps through APIs is known as embedded banking. It serves as an all-encompassing word for various financial services, such as lending, bank transfers, contactless payments, and card issuance.

In embedded banking model, banks can provide purpose-built digital services to their customers, including small and mid-sized businesses. It (embedded banking) places banks at the heart of businesses’ operations.

Banking partners are necessary to give access to bank accounts, payments, and financing to the numerous fintechs that are founded every year. Even while they can develop and provide financial services, large technology companies and other nonbanking entities are unable to become banks in many other markets where the regulatory threshold is high.

Thus, the only way for fintechs to provide customers with embedded financing is through banking as a service. To serve their huge client bases, these players need end-to-end BaaS (Banking as a Service) infrastructure solutions, together with regulatory assistance, balance sheet liquidity, and other financial sources.

The increasing demand for new finance technologies is supporting the growth of embedded banking industry and the trend is likely to continue during the assessment period.

Easy availability of open banking APIs from financial service vendors and non-financial service vendors will boost the market.

Embedded banking for payments offers various benefits that are encouraging its adoption among end users. This includes increased client stickiness, lower costs and faster time to market, and access to new jurisdictions.

It also reduces regulatory burden and risks linked with introducing new financial services products. Thanks to various benefits of embedded banking solutions, they are gaining wider popularity across Europe. This in turn is creating growth opportunities for companies.

Adoption of new banking technologies including digital banking and digital payment is expected to create a plethora of opportunities for the market. Further, advancements in Insurtech and popularity of open banking will support market expansion.

With more and more retailers planning to launch new embedded finance offerings, Europe embedding banking market is set to witness impressive growth. To gain profits, leading embedded banking companies are using various strategies.

For instance, to facilitate adoption of banking as a service (BaaS) in Europe, Vodeno, Temenos, and Aion Bank collaborated in September 2021.

Similarly, in September 2022 to power eToro Money accounts across Europe, eToro partnered with OpenPayd, a leading banking-as-a-service infrastructure provider.

Attributes	Key Insights
Estimated Europe Embedded Banking Market Value (2023)	US$ 4,395.3 million
Projected Market Value (2033)	US$ 36,377.9 million
Expected CAGR (2023 to 2033)	23.5%
Top 5 Vendor Market Share	35%

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2018 to 2022 Europe Embedded Banking Sales Outlook Compared to Demand Forecast from 2023 to 2033

Europe embedded banking sales revenue increased at 21.4% CAGR from 2018 to 2022. For the forecast period, Future Market Insights (FMI) predicts demand for embedded banking solutions across Europe to rise at 23.5% CAGR.

The Europe embedded banking industry is expected to progress due to the rapid adoption of Banking as a Service (BaaS) Solutions.

"Banking as a Service" concept enables non-banks or virtual banks to provide access to common banking products or functionalities. Instead of creating their own banking operation with a full physical infrastructure or referring customers to a third-party financier, it is simpler for a range of businesses to offer finance through licensed access.

Similarly, the potential of application programming interface (API) in embedded banking will boost the market.

API (application programming interface) serves as the channel for communication between the front-end financial solution and the back-end system. It can make the interaction easier so that the system and the application can communicate with one another.

Simply, embedded finance is the use of new, creative API usage methods. This makes it possible for users to interact with the front-end financial application and send the desired signals to the banking infrastructure.

Because of the API, non-bank providers' embedded solutions do not require a separate banking system.

Comparative View of the Adjacent Markets

Embedded Lending Market:

Attribute	Embedded Lending Market
CAGR (2023 to 2033)	19.4%
Market Value (2023)	US$ 6567 million
Growth Factor	Rise of digitalization will spur growth in the embedded lending market.
Key Trend	Growing customer demand for easy and quick access to credit will boost sales in the market.

Embedded Finance Market:

Attribute	Embedded Finance Market
CAGR (2023 to 2033)	16.4%
Market Value (2023)	~US$ 63205 million
Growth Factor	High penetration of digitalization along with acceptance of UPI payments is likely to drive the embedded finance industry.
Key Trend	Growing popularity of SME lending and rising number of fintech companies will boost the market.

Sudip Saha

Principal Consultant

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Country-wise Insights

Why is Germany Becoming a Lucrative Market for Embedded Banking Service Providers?

Strong Banking Industry & Digitalization Fueling Embedded Banking Services Demand in Germany

Germany is known for having a strong banking industry and a high level of digitalization. The country is home to various leading banks in Europe, such as Deutsche Bank and Commerzbank, and has a well-established fintech ecosystem.

The country has a high level of digitalization, which makes it a favorable market for embedded banking services. German banks have been increasingly investing in digital technologies and partnerships with fintech startups to offer embedded banking services to customers.

As per the latest report, Germany is expected to hold a share of 25.6% in the Europe embedded banking industry in 2023.

What is Driving Demand for Embedded Banking in France?

Growing FinTech Startups in France Propelling Embedded Banking Demand

France has a well-developed banking industry and is also one of the leading markets for fintech startups in Europe. The country has been actively embracing embedded banking as a way to offer customers more convenient and personalized financial services.

French banks have been investing in digital technologies and partnerships with fintech startups to offer embedded banking services to customers. For instance, the French bank BNP Paribas has partnered with several fintech startups to offer integrated financial services to its customers. This includes the ability to make payments through messaging apps or social media platforms.

With rising number of startups and increasing adoption of digital technologies, France embedded banking market is projected to expand at 19.8% CAGR through 2033.

Category-wise Insights

Which Embedded Banking Solution Can Generate Most Revenues for Companies?

Embedded Banking Platform API to Create Lucrative Revenue-generation Opportunities

Embedded banking platform APIs provide high security, ease of use, and cost-effectiveness for businesses that integrate them into their applications or platforms. They use secure encryption protocols and other advanced security measures to protect user data and transactions.

Embedded banking platform APIs can provide a more seamless and user-friendly experience for customers. They can also save time and money on infrastructure development.

By integrating these APIs into their applications or platforms, businesses can provide their customers with a more comprehensive banking experience, while also saving time and money on infrastructure development.

Embedded banking platform APIs can provide high security, ease of use, and cost-effectiveness for several businesses. Therefore, this segment is expected to witness a growth rate of 25.2% CAGR through 2033.

Who is the Leading End User of Embedded Banking Solutions?

Fintech Corporations to Remain Leading End Users for Embedded Banking Solutions

FinTech corporations will play a significant role in driving demand for embedded banking solutions. As per Future Market Insights, fintech corporations segment is likely to thrive at 25.6% CAGR through 2033.

Embedded banking refers to the integration of financial services into non-financial platforms or applications, such as e-commerce websites or mobile apps. This integration enables seamless and convenient access to financial services for users, while also creating new revenue streams for the platform providers.

FinTech corporations often have established partnerships with non-financial platforms, such as e-commerce websites or social media platforms. This can facilitate the integration of embedded banking services into these platforms.

These partnerships can help drive adoption of embedded banking services among users, particularly as the trend towards digitalization and the need for remote access to financial services continues to grow.

Why is the Popularity of Embedded Banking Solutions Rising Among Small and Mid-size Organizations?

Various Benefits Offered by Embedded Banking Solutions to Small & Mid-sized Organizations Making Them Popular

As per Future Market Insights (FMI), large organizations segment currently dominates the Europe market. On the other hand, small and mid-size organizations segment is likely to expand at a higher CAGR.

Small and mid-sized organizations, which may not have the resources or infrastructure to build their own financial services from scratch, may be particularly interested in adopting embedded banking solutions.

By partnering with financial institutions or fintech companies, these organizations can offer financial services to their customers without the need for significant investment in technology or regulatory compliance.

The Europe embedded banking market is likely to be driven by a variety of factors, including changing consumer preferences, advances in technology, and evolving regulatory frameworks.

Small and mid-sized organizations may be one segment of the market that sees significant growth as embedded banking solutions become more widely adopted. Hence, the target segment is expected to progress at a CAGR of 25.1% over the forecast period.

Competitive Landscape

The Europe embedded banking market is highly competitive and is dominated by several key players. These companies are actively engaged in new product launches, mergers and acquisitions, and collaborations to gain market share.

Recent Developments:

In September 2021, FIS (Fidelity National Information Services) acquired Paymentology, a United Kingdom-based embedded payments technology provider, for US$ 265 million.
In March 2021, Bankable, a United Kingdom-based embedded banking platform provider, launched a new platform called "Bankable Engage", which allows businesses to offer banking services to their customers without needing a banking license.

Scope of Report

Attribute	Details
Estimated Market Value (2023)	US$ 4,395.3 million
Projected Market Value (2033)	US$ 36,377.9 million
Anticipated Growth Rate (2023 to 2033)	23.5%
Share of top 5 players	35%
Forecast Period	2023 to 2033
Historical Data Available for	2018 to 2022
Market Analysis	US$ Million for Value
Key Countries Covered	Germany, Italy, France, United Kingdom, Spain, BENELUX, Russia, Rest of Europe.
Key Segments Covered	Solution, Organization Size, End User, and Country.
Key Companies Profiled	Bankable Banxware GmbH Boss Insights Sdk.finance Finix Flywire Marqeta MX OpenPayd Plaid Q2 Railsbank Synapse Tink UNIPaaS Payments Technologies
Report Coverage	Market Forecast, Company Share Analysis, Competition Intelligence, DROT Analysis, Market Dynamics and Challenges, and Strategic Growth Initiatives

Europe Embedded Banking Market Segmentation

By Solution:

Embedded Banking Platform API
Services
- Payment Processing
- Lending
- Contactless Payment
- Card Issuing
- Bank Transfer
- Others

By Organization Size:

Small and Mid-Sized Organizations
Large Organizations

By End User:

Banks
FinTech Corporations
Investment Firms
Others

By Countries:

Germany
Italy
France
United Kingdom
Spain
BENELUX
Russia
Rest of Europe

Frequently Asked Questions

How big is the market for embedded banking in Europe?

Europe embedded banking market size is estimated to reach US$ 4,395.3 million in 2023.

What is the projected valuation for the Europe embedded banking industry?

The Europe embedded banking industry is projected to reach a valuation of US$ 36,377.9 million.

At what rate will Europe embedded banking demand rise from 2023 to 2033?

Embedded banking in Europe is expected to increase at a CAGR of 23.5% through 2033.

What was the historical CAGR for the market?

Historically, during 2018 to 2022, the market for embedded banking in Europe expanded at 21.4% CAGR.

How much of the total market share is occupied by the top players?

The top 5 players combined command a share of 35% in the Europe embedded banking market.

Which end user segment dominates the Europe market for embedded banking?

FinTech corporations segment dominates the market with a share of around 30.1%

Table of Content

1. Executive Summary | Europe Embedded Banking Market

1.1. Global Market Outlook

1.2. Demand Side Trends

1.3. Supply Side Trends

1.4. Analysis and Recommendations

2. Market Overview

2.1. Market Coverage / Taxonomy

2.2. Market Definition / Scope / Limitations

3. Key Market Trends

3.1. Key Trends Impacting the Market

3.2. Product Innovation / Development Trends

4. Pricing Analysis

4.1. Pricing Analysis, By Pricing Model

4.1.1. Subscription Pricing Model

4.1.2. Perpetual Licensing

4.2. Average Pricing Analysis Benchmark

5. Market Demand (Value in US$ million) Analysis 2018 to 2022 and Forecast, 2023 to 2033

5.1. Historical Market Value (US$ million) Analysis, 2018 to 2022

5.2. Current and Future Market Value (US$ million) Projections, 2023 to 2033

5.2.1. Y-o-Y Growth Trend Analysis

5.2.2. Absolute $ Opportunity Analysis

6. Market Background

6.1. Macro-Economic Factors

6.2. Forecast Factors - Relevance & Impact

6.3. Value Chain

6.4. COVID-19 Crisis – Impact Assessment

6.4.1. Current Statistics

6.4.2. Short-Mid-Long Term Outlook

6.4.3. Likely Rebound

6.5. Market Dynamics

6.5.1. Drivers

6.5.2. Restraints

6.5.3. Opportunities

7. Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Solution

7.1. Introduction / Key Findings

7.2. Historical Market Size (US$ million) Analysis By Solution, 2018 to 2022

7.3. Current and Future Market Size (US$ million) Analysis and Forecast By Solution, 2023 to 2033

7.3.1. Embedded Banking Platform API

7.3.2. Services

7.3.2.1. Payment Processing

7.3.2.2. Lending

7.3.2.3. Contactless Payment

7.3.2.4. Card Issuing

7.3.2.5. Bank Transfer

7.3.2.6. Others

7.4. Market Attractiveness Analysis By Solution

8. Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Organization Size

8.1. Introduction / Key Findings

8.2. Historical Market Size (US$ million) Analysis By Organization Size, 2018 to 2022

8.3. Current and Future Market Size (US$ million) Analysis and Forecast By Organization Size, 2023 to 2033

8.3.1. Small and Mid-Sized Organizations

8.3.2. Large Organizations

8.4. Market Attractiveness Analysis By Organization Size

9. Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By End User

9.1. Introduction / Key Findings

9.2. Historical Market Size (US$ million) Analysis By End User, 2018 to 2022

9.3. Current and Future Market Size (US$ million) Analysis and Forecast By End User, 2023 to 2033

9.3.1. Banks

9.3.2. FinTech Corporations

9.3.3. Investment Firms

9.3.4. Others

9.4. Market Attractiveness Analysis By End User

10. Market Analysis 2018 to 2022 and Forecast 2023 to 2033, by Countries

10.1. Introduction / Key Findings

10.2. Historical Market Size (US$ million) Analysis By Countries, 2018 to 2022

10.3. Current and Future Market Size (US$ million) Analysis and Forecast By Countries, 2023 to 2033

10.3.1. Germany

10.3.2. Italy

10.3.3. France

10.3.4. United Kingdom

10.3.5. Spain

10.3.6. BENELUX

10.3.7. Russia

10.3.8. Rest of Europe

10.4. Market Attractiveness Analysis By Countries

11. Key Countries Analysis- Market

11.1. Germany Embedded Banking Market Analysis

11.1.1. By Solution

11.1.2. By Organization Size

11.1.3. By End User

11.2. Italy Market Analysis

11.2.1. By Solution

11.2.2. By Organization Size

11.2.3. By End User

11.3. France Market Analysis

11.3.1. By Solution

11.3.2. By Organization Size

11.3.3. By End User

11.4. United Kingdom Market Analysis

11.4.1. By Solution

11.4.2. By Organization Size

11.4.3. By End User

11.5. Spain Market Analysis

11.5.1. By Solution

11.5.2. By Organization Size

11.5.3. By End User

11.6. BENELUX Market Analysis

11.6.1. By Solution

11.6.2. By Organization Size

11.6.3. By End User

11.7. Russia Market Analysis

11.7.1. By Solution

11.7.2. By Organization Size

11.7.3. By End User

11.8. Rest of Market Analysis

11.8.1. By Solution

11.8.2. By Organization Size

11.8.3. By End User

12. Market Structure Analysis

12.1. Market Analysis by Tier of Companies

12.2. Market Share Analysis of Top Players

12.3. Market Presence Analysis

13. Competition Analysis

13.1. Competition Dashboard

13.2. Competition Benchmarking

13.3. Competition Deep Dive

13.3.1. Bankable

13.3.1.1. Business Overview

13.3.1.2. Solution Portfolio

13.3.1.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.1.4. Key Strategy & Developments

13.3.2. Banxware GmbH

13.3.2.1. Business Overview

13.3.2.2. Solution Portfolio

13.3.2.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.2.4. Key Strategy & Developments

13.3.3. Boss Insights

13.3.3.1. Business Overview

13.3.3.2. Solution Portfolio

13.3.3.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.3.4. Key Strategy & Developments

13.3.4. Sdk.finance

13.3.4.1. Business Overview

13.3.4.2. Solution Portfolio

13.3.4.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.4.4. Key Strategy & Developments

13.3.5. Finix

13.3.5.1. Business Overview

13.3.5.2. Solution Portfolio

13.3.5.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.5.4. Key Strategy & Developments

13.3.6. Flywire

13.3.6.1. Business Overview

13.3.6.2. Solution Portfolio

13.3.6.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.6.4. Key Strategy & Developments

13.3.7. Marqeta

13.3.7.1. Business Overview

13.3.7.2. Solution Portfolio

13.3.7.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.7.4. Key Strategy & Developments

13.3.8. MX

13.3.8.1. Business Overview

13.3.8.2. Solution Portfolio

13.3.8.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.8.4. Key Strategy & Developments

13.3.9. OpenPayd

13.3.9.1. Business Overview

13.3.9.2. Solution Portfolio

13.3.9.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.9.4. Key Strategy & Developments

13.3.10. Plaid

13.3.10.1. Business Overview

13.3.10.2. Solution Portfolio

13.3.10.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.10.4. Key Strategy & Developments

13.3.11. Q2

13.3.11.1. Business Overview

13.3.11.2. Solution Portfolio

13.3.11.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.11.4. Key Strategy & Developments

13.3.12. Railsbank

13.3.12.1. Business Overview

13.3.12.2. Solution Portfolio

13.3.12.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.12.4. Key Strategy & Developments

13.3.13. Synapse

13.3.13.1. Business Overview

13.3.13.2. Solution Portfolio

13.3.13.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.13.4. Key Strategy & Developments

13.3.14. Tink

13.3.14.1. Business Overview

13.3.14.2. Solution Portfolio

13.3.14.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.14.4. Key Strategy & Developments

13.3.15. UNIPaaS Payments Technologies

13.3.15.1. Business Overview

13.3.15.2. Solution Portfolio

13.3.15.3. Profitability by Market Segments (Solution/Organization Size/End Users/Country)

13.3.15.4. Key Strategy & Developments

14. Assumptions and Acronyms Used

15. Research Methodology

List of Tables

Table 1: Market Value (US$ million) Analysis (2018 to 2033) By Solution

Table 2: Market Value (US$ million) Forecast (2023 to 2033) By Solution

Table 3: Market Value (US$ million) Analysis (2018 to 2033) By Organization Size

Table 4: Market Value (US$ million) Forecast (2023 to 2033) By Organization Size

Table 5: Market Value (US$ million) Analysis (2018 to 2033) By End User

Table 6: Market Value (US$ million) Forecast (2023 to 2033) By End User

Table 7: Market Value (US$ million) Analysis (2018 to 2033) by Country

Table 8: Market Value (US$ million) Forecast (2023 to 2033) by Country

Sudip Saha

Principal Consultant

Talk to Analyst

Find your sweet spots for generating winning opportunities in this market.

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List of Charts

Figure 1: Market Value (US$ million), 2018 to 2022

Figure 2: Market Value (US$ million), 2023 to 2033

Figure 3: Market Value Share Analysis (2023 to 2033) By Solution

Figure 4: Market Value Y-o-Y Growth Trend Analysis (2018 to 2033) By Solution

Figure 5: Market Attractiveness by Solution

Figure 6: Market Value Share Analysis (2023 to 2033) By Organization Size

Figure 7: Market Value Y-o-Y Growth Trend Analysis (2018 to 2033) By Organization Size

Figure 8: Market Attractiveness by Organization Size

Figure 9: Market Value Share Analysis (2023 to 2033) By End User

Figure 10: Market Value Y-o-Y Growth Trend Analysis (2018 to 2033) By End User

Figure 11: Market Attractiveness by End User

Figure 12: Market Value Share Analysis (2023 to 2033) by Country

Figure 13: Market Value Y-o-Y Growth Trend Analysis (2018 to 2033) by Country

Figure 14: Market Attractiveness by Country

Figure 15: Germany Market Absolute $ Opportunity (US$ million), 2018 to 2033

Figure 16: Italy Market Absolute $ Opportunity (US$ million), 2018 to 2033

Figure 17: France Market Absolute $ Opportunity (US$ million), 2018 to 2033

Figure 18: United Kingdom Market Absolute $ Opportunity (US$ million), 2018 to 2033

Figure 19: Spain Market Absolute $ Opportunity (US$ million), 2018 to 2033

Figure 20: BENELUX Market Absolute $ Opportunity (US$ million), 2018 to 2033

Figure 21: Russia Market Absolute $ Opportunity (US$ million), 2018 to 2033

Figure 22: Rest of Market Absolute $ Opportunity (US$ million), 2018 to 2033