Embedded finance is fast-growing and is being used by many top companies stated Bahaa Abdul Hussein. Even non-financial companies can embed financial services and offer it to their customers. Embedded finance has become a disruptor and has created a powerful impact in the market. The market size for embedded finance is 83 billion dollars and is expected to increase to 588 billion dollars by 2030. Multiple opportunities are available for embedded finance, including in emerging markets.

Embedded finance in emerging markets

Apart from the developed countries, developing countries are using embedded finance extensively. The emerging markets in countries like India and China have a lot of potential to offer.

The growth of mobile internet has made internet more accessible for people living even in remote corners. This is true even in emerging markets. Young people are increasingly using financial services. Improved financial education has made people realize the importance of financial services. Businesses are tying up with digital platforms to embed financial services and offer them along with their other services.

The opportunities include in areas like:

  1. Super apps: These are one-stop apps that offer a host of services to its customers on one platform. Such a super app would offer embedded finance services to its customers.
  2. BNPL: Buy Now Pay Later has become a popular trend. This market is expected to reach 995 billion dollars by 2025. BNPL services are an integral part of embedded services.
  3. Insurance: Non-finance companies are offering insurance as one of the services for the convenience of their customers. For example, travel companies are embedding travel insurance along with their regular offerings.
  4. Investment: Embedded wealth management is a part of embedded finance and helps people with their investments. Investment platforms are tying up with various companies to offer embedded wealth services.
  5. Digital wallets: This is a classic example of embedded finance with wallets being integrated with non-financial services.

Embedded finance can have a strong impact on emerging markets. This is why such markets welcome embedded finance firms. The impact is on areas like:

  • It helps improve financial inclusion allowing financial services to be provided to people who are far off or could not afford these services.
  • Ensuring financial inclusion has a positive effect on economic growth of the country.
  • Embedded finance is an innovation that can disrupt the market. It improves market competitiveness, which benefits customers and the economy.

Embedded finance can offer low-cost and value-adding services in emerging markets. It can help the economy of these emerging markets, which is why there it has a huge potential for growth. Thank you for your interest in Bahaa Abdul Hussein blogs. For more information, please visit www.bahaaabdulhussein.com.