December 2022 Summaries

Embedded finance integrates services such as payments, accounts, cards, lending, and insurance into non-financial products, allowing businesses to create smoother customer experiences and potentially develop new revenue streams. Its growth has been accelerated by fintech innovation, digital consumer expectations, and open-banking regulations such as Europe’s PSD2, which requires banks to provide authorized third parties access to customer data through APIs with consent. Businesses can use fintech partners to add capabilities like multi-currency payments, foreign exchange, card issuing, payouts, and connected accounts without building complex financial infrastructure themselves. Airwallex positions its API-based products as tools for businesses ranging from e-commerce firms to investment platforms, citing its partnership with Plum as an example of using embedded foreign-exchange functionality to support international investing. As economic uncertainty and competition from digital-native brands increase, the company argues that embedded finance can help organizations scale, improve user experience, and expand globally, while noting that the material is informational rather than legal, tax, regulatory, or investment advice.