FMI Report: embedded finance market to reach US$ 248.4 bn by 2032



According to the market report by Future Market Insights (FMI), the embedded finance market is forecasted to reach a net value of US$ 248.4 Bn in 2032, going up from US$ 43 Bn in 2021. It is estimated that the market can register a robust CAGR of 16.4% over these forecast years.
Incorporating banking software directly into the online websites of retailers or any company has surfaced in the form of embedded financial services in the global market. Many online retailing websites of various products and services or e-commerce platforms are incorporating this solution for the convenience of their customers.
Application technological development or API solutions have replaced the previously deployed online purchases that were time consuming and required a higher amount of investment.
The easiness of doing business through embedded banking systems has resulted in greater customer retention and higher profit-making. Embedded finance as an attractive option in the global market.
Improving economic condition and level of digital literacy among the general mass of particularly developing countries has increased the number of internet connections and traffic over e-commerce websites. This surge in demand for online purchases is anticipated to drive the global embedded finance market over the coming years indirectly.
“The volume of online money transactions has increased exponentially in the past years. Many enterprises are deploying online stores and e-commerce websites for vending their products and services over online channels. This shift in business model has necessitated the use of embedded services, making it an attractive market for many embedded finance fintech companies.”
Innovations in banking technology such as unified payment systems (UPI) and mobile payment apps are expected to have a major impact on the embedded finance market forecast. Also, the security challenges and data privacy issues are anticipated to hamper the growth rate of the global market for some more years ahead.
Key Takeaways
  • The global embedded finance market size is estimated to be not worth US$ 54.3 Bn in 2022 and can witness a growth of US$ 194.1 Bn in absolute dollars until the end of this forecast time period.
  • Among the different types of services provided by the global embedded finance market, the embedded banking services sector is poised to be the highest growing segment, with an estimated CAGR of 16.2% during the forecast timeframe.
  • Investment banks and investment companies are the top revenue-generating segments for the embedded finance fintech. This segment is predicted to witness a robust CAGR of 16.2% over the forecast years.
  • North America is the dominating region for embedded financial services, with the USA contributing more than 35% of the total revenue generated. The total net worth of the USA embedded finance market is predicted to be valued at about US$ 89 Bn in the year 2032.
  • The Asia Pacific follows North America in terms of growth rate in embedded financial services that have some emerging economies contributing significantly to the global market. China is the top-performing country with an overall valuation of US$ 17 Bn by the end of 2032.
Competitive Landscape
The major players operating in the global embedded finance market include Bankable, Banxware, Cross River, Finix, Flywire, Marqeta, RailsBank, Openpayd, Plaid, and Q2.
Almost all financial institutions have started providing embedded services along with the dedicated embedded finance fintech companies that have made the global embedded financial market highly competitive than ever before.
Some of the major strategies adopted by the top players in the market include the provision of innovative services such as embedded lending at the point of sale (PoS) for attracting retail customers.
In recent years inclusion of embedded insurance premiums has created great opportunities for the market growth of embedded finance service providers. The estimated value of insurance premiums contributed to the market through embedded financial services was around US$ 3.8 Bn in the year 2021. Integration of such new services is expected to boost the global embedded finance market.

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