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Revolutionizing Payments in India: The Rise of Banking-as-a-Service and Embedded Payments
December 04, 2023
In recent years, digital payment methods like Tap and Pay, Scan and Pay, QR Code, and Online Transfers have gained immense popularity even in India’s remote areas and small towns. This transformation is attributed to innovations in Financial Technology (FinTech), particularly Banking-as-a-Service (BaaS) and embedded payments.
BaaS, functioning as an end-to-end process, enables FinTech companies and third-party organizations to seamlessly connect with a bank’s infrastructure through Application Programming Interfaces (APIs). This connection forms the foundation of embedded payments, becoming the norm for various online platforms, including e-commerce, investments, and delivery apps.
Embedded payments simplify banking by allowing customers to make payments directly on the platform they are using, eliminating redirection to third-party payment providers. In 2022, the Indian BaaS market was valued at $14 billion, and it’s poised for further growth as the country shifts towards customer-centric financial models.
The growth of embedded finance, especially embedded payments, is remarkable, with the Indian industry projected to reach $21,127.5 million by 2029 at a Compound Annual Growth Rate (CAGR) of 30.4%. BaaS enables FinTechs and non-banking entities to offer advanced financial products without obtaining a banking license, fostering financial inclusion.
For consumers, BaaS and embedded payments translate into enhanced utility and convenience. These services are integrated into merchant apps or websites, eliminating the need to seek payment solutions elsewhere. As India focuses on customer-centric financial innovations, BaaS and embedded payments stand out as a revolutionary force, reshaping the financial landscape and promoting financial inclusion nationwide.
Important Links:
- Certificate Program in Banking, Financial Services & Insurance: https://ask.careers/courses/certificate-program-in-banking-financial-services-insurance/
- Certificate in Banking and Financial Services: https://ask.careers/courses/certificate-in-banking-and-financial-services/
- 4-IN-1 Professional Diploma in Banking, Financial Services & Insurance (PDBFSI): https://ask.careers/courses/4-in-1-professional-diploma-in-banking-financial-services-insurance-pdbfsi/
- Ahmedabad: https://ask.careers/cities/ahmedabad/
- Mumbai: https://ask.careers/cities/mumbai/
- TSCFM: https://ask.careers/institutes/tscfm/
