DIGITAL PAYMENTS
“When financial offerings are integrated into apps and websites people use daily , lenders can use more data to understand a person ’ s creditworthiness , beyond just traditional credit scores ”
MIKE SMITH BANKING AND FINANCE EXPERT
The authors of PwC research – which itself predicts that embedded finance applications will increase five-fold between now and 2032 – believe that “ embedded lending is showing great appeal ” for non-financial institutions entering the marketplace for the first time .
“ Software providers , in particular , are offering embedded finance services by leveraging external customer data , nextgeneration decisioning models and API-enabled technology ,” they say . “ For example , financial software provider Intuit has expanded from providing accounting tools to offering small business loans through a subsidiary with a commercial banking licence , using financial information and credit histories inputted into the accounting software .”
The growth of embedded lending should cause incumbent institutions to worry , PwC says . “ Incumbent banks risk losing market share in the credit space to new entrants , particularly as lending becomes more
fintechmagazine . com 75