Finance

The Growth of Embedded Finance: Transforming Traditional Financial Models

Direct-to-consumer offerings have long been a cornerstone of the financial sector. However, embedded finance is transforming how banks, businesses, and FinTechs engage with customers in real time, driving new revenue streams while providing users with a wide range of payment options tailored to their needs.

In its broadest sense, embedded finance integrates banking, payments, and lending into non-financial environments, where apps and digital interactions with businesses now seamlessly include features like buy now, pay later (BNPL) and other point-of-sale alternatives.

Smartphones, tablets, and the platforms of businesses themselves have become gateways to expansive commerce ecosystems, fostering consumer engagement and transactions. At the same time, these systems enhance the cash flow of the businesses (and indirectly, the banks and FinTechs) they partner with.

The Appeal of Personalized Lending
Embedded lending, a significant part of embedded finance, is particularly attractive to lenders because it enables them to reach new customers, promote financial inclusion, and use data to create customized offers that increase conversion rates.

According to the report “Embedded Lending: From the Lender’s Perspective,” a collaboration between Visa and PYMNTS Intelligence, embedded lending options are increasingly seen as valuable. The study reveals that 47% of lenders worldwide offer only embedded lending, with an additional 31% providing a mix of embedded and traditional lending types. Only 12% of firms are not offering embedded lending options.

There’s a noticeable difference between consumer and SMB (small and medium-sized business) lending. 83% of lenders targeting consumers offer at least one embedded lending product, whereas only 55% of SMB lenders do the same. Interestingly, 37% of SMBs express strong interest in switching to providers that offer embedded lending solutions, a trend that could grow as inflation and concerns over access to capital continue to affect SMBs navigating trade uncertainties and striving to maintain solid supplier relationships.

On the consumer side, research from PYMNTS Intelligence in partnership with Carat from Fiserv, “Platform Business Survey: The Rise of Embedded Payments,” highlights how adding payment features to services has allowed independent software vendors (ISVs) and marketplaces to generate revenue by embedding payments into the core of their commerce experience. The data shows that 65% of ISVs and marketplaces that currently don’t offer payment capabilities plan to incorporate embedded financial products for payment processing. This includes everything from digital wallets and branded cards to BNPL options. In marketplace ecosystems, consumers can now access multiple lending offers in one central location within the platform.

TECH

Xi's Bold Vision: China Must Lead the Global Tech Race

During China’s annual legislative meeting, Xi Jinping made it clear that nothing will stand in the way of his plans for China to surpass its competitors and become a technological powerhouse—not the economic slowdown, local government debt, or even the ongoing trade war with the United States.

The National People’s Congress, held in Beijing, was once a venue for Communist Party leaders to put on a show of public consultation. While the delegates, carefully chosen by the party, occasionally voiced concerns about issues like pollution, there were rare moments of disagreement among senior officials.

However, under Xi’s leadership, the meeting has transformed into a highly coordinated, weeklong tribute to himself and his vision. This time, he called for China to push forward in cutting-edge technologies like artificial intelligence, biotechnology, and advanced weaponry.

“Xi has observed how decades of U.S. government investment in science after World War II led to immense success, and now he wants to replicate that,” said Jimmy Goodrich, a senior adviser at RAND Corporation who specializes in China’s science policies.

CRYPTO

BlackRock CEO Warns of Risks as Bitcoin and Crypto Market Faces $1 Trillion Sell-Off

Bitcoin and crypto prices have sharply declined, following a similar trend in the stock markets, amid growing concerns that Bitcoin may be on the brink of a significant crash.

The price of Bitcoin has fallen below $80,000, dragging the broader crypto market down, which has lost $1 trillion in value in just one month—even as optimistic traders hope for a “game-changer” from U.S. President Donald Trump.

In the midst of this, Elon Musk has issued an unexpected warning about crypto prices, while BlackRock’s CEO, the head of the world’s largest asset manager, has cautioned that Trump’s trade policies could fuel inflation—dampening hopes that the Federal Reserve might cut interest rates through 2025.