Embedded Finance and Super Apps: The Next Frontier for Banking Innovation
The banking industry is at a pivotal moment. As digital transformation accelerates, two powerful trends—embedded finance and the rise of super apps—are redefining how financial services are delivered, consumed, and monetized. For banks, these trends represent both a challenge and an unprecedented opportunity: to create new revenue streams, reach underserved segments, and deliver seamless, contextual financial services that become part of customers’ daily digital lives.
What is Embedded Finance?
Embedded finance is the integration of financial services—such as payments, lending, insurance, and investment—directly into non-financial platforms and experiences. Rather than requiring customers to visit a bank or use a standalone app, embedded finance brings banking to where customers already are: e-commerce sites, ride-sharing apps, ERP systems, and more. This model is already familiar through services like Buy Now, Pay Later (BNPL), but its potential extends far beyond consumer payments.
The market opportunity is vast. As digital transformation lowers the cost and complexity of integration, businesses across industries are embedding financial services to enhance customer experience, drive engagement, and unlock new monetization models. For banks, this means the chance to serve new customer segments—including the underbanked—by partnering with platforms that have deep customer relationships and behavioral insights.
The Super App Revolution
Super apps—multi-functional platforms that combine messaging, payments, shopping, mobility, and more—have already transformed digital life in Asia, with platforms like WeChat and Alipay leading the way. Now, the concept is gaining traction globally. In financial services, super apps promise to consolidate a wide range of banking and non-banking services into a single, seamless experience.
For consumers, the appeal is clear: convenience, personalization, and the ability to manage all aspects of their financial lives in one place. For banks, super apps offer a new channel to engage customers, cross-sell products, and gather rich data to fuel innovation. They also present a strategic choice: should a bank embed its services within third-party super apps, or develop its own ecosystem to become a super app in its own right?
Strategic Choices: Embed or Develop?
Banks face a critical decision in the super app era:
- Embed: By integrating their services into third-party super apps, banks can quickly access new customer bases, bring products to market efficiently, and focus on being the infrastructure provider of choice (e.g., via Banking-as-a-Service or Payments-as-a-Service). This approach is ideal for banks seeking scale, speed, and access to untapped segments.
- Develop: Building a proprietary super app allows banks to own the customer relationship, monetize engagement and data, and differentiate through personalized experiences. This path requires significant investment in technology, partnerships, and regulatory compliance, but offers the potential for deeper loyalty and long-term growth.
The right strategy depends on a bank’s strengths, market position, and appetite for innovation. Some may choose a hybrid approach, embedding in select platforms while developing their own digital ecosystems.
Technology, Partnerships, and Regulatory Considerations
To succeed in embedded finance and super apps, banks must address several key enablers:
- Modern, Decoupled Architecture: Banks need flexible, API-driven platforms that can scale, integrate with partners, and support rapid innovation. Moving toward a coreless, cloud-based architecture is essential for agility and future-proofing.
- Data and Analytics: High-quality, accessible data is the foundation for personalized, contextual services. Banks must break down data silos, invest in analytics, and ensure robust data governance to unlock the full value of embedded finance.
- Partnership Ecosystems: Success in this new landscape requires strong partner management and the ability to co-create value propositions with non-financial platforms. Banks must develop operating models that support collaboration, shared data, and joint innovation.
- Regulatory Compliance: As banks expand into new channels and partnerships, navigating complex regulatory requirements—especially around data privacy, security, and consumer protection—becomes even more critical. Open banking initiatives and evolving regulations can be both enablers and challenges.
Unlocking New Value: Revenue, Reach, and Inclusion
The benefits of embedded finance and super apps are tangible:
- New Revenue Streams: By embedding services in high-traffic platforms or building their own super apps, banks can generate fees, commissions, and cross-sell opportunities beyond traditional banking products.
- Expanded Reach: Partnering with non-financial platforms allows banks to serve new customer segments, including SMEs and the underbanked, who may not engage with traditional channels.
- Seamless, Contextual Experiences: Embedded finance enables banks to deliver services at the point of need—whether it’s instant credit at checkout, insurance within a ride-hailing app, or working capital finance embedded in a business’s ERP system.
- Financial Inclusion: Super apps and embedded finance can bridge gaps for underserved populations, providing access to essential financial services through familiar digital platforms.
Global Trends and Case Studies
Across markets, leading banks are already embracing these models:
- In commercial banking, institutions are embedding payments, lending, and cash management directly into clients’ ERP and treasury systems, enabling real-time, frictionless finance.
- Partnerships between banks and fintechs are driving innovation in embedded payments, digital wallets, and B2B finance, with APIs and open banking as key enablers.
- In Asia, super apps have become the primary interface for millions of consumers, integrating banking, payments, and lifestyle services in a single platform.
Publicis Sapient’s Experience
Publicis Sapient has partnered with global banks to design and build scalable, customer-centric digital ecosystems. Our work spans:
- Developing embedded finance strategies and architectures that enable rapid integration with partners
- Building cloud-native, API-driven platforms for Banking-as-a-Service
- Orchestrating partnership models that unlock new revenue and reach
- Ensuring regulatory compliance and data security in complex, multi-party environments
- Leveraging data and AI to deliver hyper-personalized, contextual experiences within super apps and embedded channels
The Path Forward
The next frontier for banking innovation lies in moving beyond traditional digital transformation to embrace the broader ecosystem play. Banks that seize the embedded finance and super app opportunity will not only defend against fintech and big tech disruptors—they will redefine their role in customers’ lives, becoming trusted partners in the moments that matter.
To succeed, banks must:
- Make bold choices about where and how to play in the ecosystem
- Invest in modern technology and data foundations
- Build the right partnerships and operating models
- Prioritize customer-centricity and seamless experiences
The future of banking is embedded, intelligent, and ecosystem-driven. Now is the time to act.
Ready to explore your embedded finance or super app strategy? Publicis Sapient can help you design, build, and scale the digital ecosystems that will define the next era of banking. Learn more at publicissapient.com/fs.