Delivering financial services at the point of need

Have you ever been asked if you want to split an online purchase into four easy payments? Skipped the line at a coffee shop because you ordered and paid through an app? Been offered an extended warranty at check out, a credit card mid-flight or a chance to auto-invest spare change? 

These are all examples of embedded finance. 

Put simply, embedded finance is the delivery of financial services – literally any kind of financial service – at the point of need.
 

Anytime, anywhere financial services – built on a banking foundation

Most embedded finance experiences look simple on the surface – tap a button, get a card, move money, borrow funds, cash out. But many of those features rely on banking products like debit or credit cards, digital wallets, deposit accounts or lending that rest on a banking foundation.

In addition, embedded experiences often benefit from banking as a service solutions. That can include ledger capabilities to track balances, postings, reversals, fees, settlements and disputes provided through a cloud-native system of record. Sponsor banks are also needed whenever regulated banking services are provided by a non-financial institution. Support for compliance, such as KYC or fraud prevention, is delivered via APIs.

With the right foundation in place, here are a few ways merchants, fintechs, large enterprises, platforms and others are building embedded finance into their customer journeys:

Branded cards: Branded cards integrate credit and debit options directly into a company's app or platform. That can be anything from a retailer’s credit card – think of a well-known red one – to the prepaid card a food delivery company offers its drivers to pay for grocery orders upfront. APIs enable customized card experiences, like card management, replacement, loyalty and rewards. 

Embedded payments: Embedded payments let customers pay directly inside a company’s app or platform. A coffee behemoth, a burger joint, a grocery delivery, a cable company. Whenever a customer adds a card or taps “Pay Now” within the experience, they’ve used an embedded payment. APIs enable these embedded payments features, such as saving a card on file, accessing one-click checkout, splitting a bill or getting instant refunds. 

Embedded investments: People can buy, sell and save within the apps they already use. Think the “Invest” button in a banking app, a feature that automatically allocates spare change to a retirement plan, or a gig platform that gives workers a chance to auto-invest a portion of their earnings. 

Embedded payouts: Embedded payouts are another type of payment, where people and businesses can be paid in near-real time. That could be tips sent right after a shift or same-day refunds that show up before the customer closes the app. Or it could be paying gig workers instantly. For example, DoorDash wanted to make it easier for “Dashers” to access and manage their earnings. In collaboration with Starion, Fiserv and Central Payments, they launched Crimson, a full-featured deposit account that is embedded directly within the Dasher app. It provides fast, flexible access to earnings along with financial tools like direct deposit, money movement capabilities and cash access.
 

Seamless experiences for users driven by behind-the-scenes expertise

Embedded finance experiences are designed to be seamless for the end user. For example, a delivery driver might start their day with a coffee purchase in-app (embedded payments), use a prepaid company card to pay for a customer order (branded cards), access a small working-capital advance to cover fuel for the week (embedded lending), request wages for the day’s work through their driver app (embedded payouts), and receive payment via a bespoke employee debit card program (branded cards).

These are as-needed, on-demand financial services options that are designed to be low-friction, easy to access and easy to use, so people can get what they need without ever leaving the platform they’re on.

Behind the scenes, it’s a complex business. 

With embedded payments, merchants need an acquiring bank to accept card transactions. A processor is needed to move the transaction across card networks, such as Visa or Mastercard, while a gateway encrypts and routes the payment. Branded cards – whether debit, prepaid or credit – must be issued by a sponsor bank, then move through card production and program management for processing, risk and settlement. Embedded investments require licensed broker-dealer partnerships and a regulated custodian to open accounts, execute orders and hold assets. 

All of this happens in the background, facilitated by partners like Fiserv who connect financial institutions, fintechs, merchants and others to the technology, services and operational support needed to design and deliver. 

 

Why meeting the moment is within reach

The market for embedded finance solutions is growing rapidly, largely because the key ingredients are firmly in place:

• APIs to build on. Modern APIs make it simple to customize offerings and add features like payments, card issuing, branded cards, payouts, loyalty options and stablecoins without rebuilding the stack.
• A proliferation of cloud-native solutions. Cloud tools scale up and down, update quickly and support real-time services like instant payouts and programmable wallets. They’re the backbone of any embedded finance offering, providing the infrastructure that makes innovation possible.
• Supportive policy signals. The GENIUS Act and related digital-asset guidance are creating clearer rules and encouraging pilots with banks, merchants and the public sector.
• Elevated user expectations. People expect money to move 24/7 according to the rules they set inside the apps they already use and trust.

With the right infrastructure, the right partners and the right know-how in place, the only thing left is the next big idea.

 

The next wave of embedded finance will be powered by imagination

Every day, banks, merchants and fintechs are finding ways to seamlessly embed financial products and services into everyday digital experiences. This is only the beginning of their story. The real power of embedded finance doesn’t lie in what others have already done. It exists in the new ideas yet to come.

Maybe it’s a fitness app that turns streaks into investable rewards or a contractor platform that releases partial payment when contract milestones are met. It could be using geolocation to precisely determine when to offer a pre-approved auto loan, or an algorithm that recognizes when a small business needs a line of credit. 

At its best, embedded finance goes beyond convenient options and inventive experiences. Ultimately, it offers an opportunity to improve people’s financial lives. An easier path to budgeting, better ways to invest, peace of mind. 

Imagine a platform that embeds stablecoin as a payout method for its creators. It’s a secure, convenient, real-time form of money movement. It’s also a way for a global community of entrepreneurs to guard against currency volatility and protect their hard-earned income. It’s a game-changer for people working to build better lives. That’s the power of embedded finance, and it’s just waiting for the next big idea.