The Fintech Brief Newsletter | Embedded Finance Is Going Mainstream—Here’s the Data

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Editor’s Pick 📌

Per Dahlqvist on the Real Shifts Happening in Payments Right Now

Fresh from the floor at TRANSACT, Liberis’ Per Dahlqvist shares five trends shaping the future of payments and embedded finance. From FedNow’s momentum to AI-powered underwriting, here’s what caught our attention:

• Embedded finance is going mainstream

• Real-time payments are gaining serious ground

• AI is powering real outcomes

• Fraud prevention is evolving fast

• Acquirers are stepping into lending territory

👉 Read the full breakdown →

Expert Opinion ✍️

Harnessing Embedded Finance Amidst Tariff Turbulence

🌍 Navigating Tariff-Induced Market Volatility: Opportunities in Embedded Finance

In today's ever-evolving global trade landscape, shifts in tariff policies are more than just numbers on a spreadsheet—they're the winds of change rippling through global supply chains. As businesses grapple with these changes, the demand for agile financial solutions, particularly embedded finance, is on the rise. Let's dive into how these shifts are reshaping the market and the opportunities they present.

📈 The Impact of Tariff Shifts on Global Supply Chains

Tariffs, once seen as temporary measures, have become a staple in the economic toolkit of many nations. The recent imposition of tariffs by the US on countries like China, Canada, and Mexico has sent shockwaves through industries, affecting cost structures and supply chain dynamics. For instance, the apparel and electronics sectors, heavily reliant on imports, are feeling the pinch as costs rise and supply chains become more complex.

💡 Embedded Finance: A Beacon of Hope

In this turbulent environment, embedded finance emerges as a game-changer. By integrating financial services directly into business operations, companies can mitigate risks associated with international trade disruptions. Take the example of Walmart and JPMorgan Chase's partnership, which allows marketplace sellers to manage payments and cash flow seamlessly. This integration not only enhances operational efficiency but also provides a cushion against financial uncertainties.

🔍 Real-World Data and Case Studies

Examining real-world data, we see that tariff fluctuations have led to an 18% decrease in profitability for some businesses, as noted in a Gartner survey. However, companies that have embraced embedded finance solutions have managed to offset these impacts. For instance, a retailer leveraging embedded finance to streamline its payment processes reported a 6% improvement in operational performance, showcasing the tangible benefits of this approach.

🚀 Next Steps for Businesses

So, what can businesses do to navigate this new normal? Here are some actionable steps:

• Diversify Supply Chains: Reduce dependency on a single region by exploring alternative sourcing options.

• Leverage Embedded Finance: Integrate financial solutions to enhance cash flow management and reduce transaction costs.

• Stay Informed: Regularly update risk management strategies to align with current business objectives and market conditions.

Industry Trends & Innovation 💡

FINANCIAL INNOVATION

Embedded Finance Moves Beyond Fintech—and into the Mainstream

Embedded finance is increasingly being integrated into non-financial platforms, with forecasts projecting a £7.2 trillion global market by 2030. From digital payments to flexible credit, this shift is driving greater financial inclusion—particularly in markets like the UAE, where digital adoption is accelerating. For acquirers and PSPs, the message is clear: the infrastructure they build today must support the embedded services of tomorrow.

PAYMENT OPTIMIZATION STRATEGIES

Optimise ISV Growth Through Embedded Finance And Enhanced Revenue Streams

Independent Software Vendors (ISVs) should incorporate embedded finance to optimise revenue and strengthen customer loyalty. By integrating flexible banking and payment solutions, ISVs can meet diverse market needs, such as offering lending options or streamlining insurance disbursements. This approach promises significant revenue growth, projected to hit £320 billion globally by 2030.

PAYMENT SOLUTIONS EXPANSION

Sipay Secures £78M Series B At £875M Valuation For Global Expansion

Sipay has secured $78 million in Series B funding, bringing its valuation to $875 million, led by Elephant VC. This investment supports Sipay's expansion into emerging markets, leveraging its proven success in Turkey, where it boasts 6.3 million wallet users and partnerships with key financial entities like Visa and Mastercard. By enhancing its embedded finance solutions, Sipay aims to optimise cross-border payments and foster international business growth.

FINTECH FUNDING

Plaid Secures £575 Million Funding Amid Fintech Sector Growth

Plaid has secured $575 million in funding, underscoring its critical role in fintech, as consumers increasingly adopt digital banking and open finance solutions. This funding will bolster Plaid's data networks, enhance security, and expand its international reach, making it a cornerstone for investors eyeing growth in financial technology infrastructure.

OPEN BANKING EXPANSION

Yavrio Integrates Major U.S. Banks To Enhance Payments For Businesses

Yavrio's connection with the five largest US banks—Wells Fargo, J.P. Morgan, Citi Bank, Bank of America, and U.S. Bank—brings enhanced embedded payment solutions. This advancement streamlines financial operations for businesses, offering secure, real-time data integration into ERP systems for improved efficiency. As Open Banking gains traction in the US, Yavrio's solution addresses inefficiencies in traditional finance systems, empowering businesses to manage transactions with heightened control and visibility.