Surge in B2B embedded finance demand

Most US B2B businesses are familiar with embedded finance and already offer a solution.

Key takeaway: The top three critical business pain points being solved by embedded finance today are: customer retention, cash flow management and revenue growth.

So says Juniper Research in collaboration with Galileo Financial Technologies.

Take note: Galileo Financial Technologies is a financial technology company owned and operated independently by SoFi Technologies (NASDAQ quoted), so has an interest in the findings. The company is based in Hampshire, UK, and Salt Lake City, US.

Highlights:

85% of B2B businesses are familiar with the concept;
65% of those not currently offering a solution are now considering it;
68% would prefer to offer such services from a non-bank provider;
payments, employee/employer services and credit and lending solutions are the top three use cases in market today.

“The dramatic rise in the adoption of digital payments among both consumers and businesses, has enabled people and businesses to do more with technology than ever before—paving the way for enormous growth for embedded financial services,” said Seth McGuire, CRO of Galileo Financial Technologies. “The market has evolved at lighting speed and this new research confirms that forward-thinking B2B executives are embracing embedded finance solutions as a key part of their growth strategies.”

The survey of 450 C-level executives in B2B businesses across the US asked business leaders about their attitudes towards it, what types of financial services they currently or want to offer, how many providers they use, who they prefer as their embedded finance partner and what value embedded finance solutions provide to their clients.

Further findings:

inherent need for US businesses to offer such solutions;
these will better enable payments, payroll, credit and lending, insurance, banking and other financial services across the B2B industry;
63% of businesses who use it today, the majority (78%) work with two or more providers to enable their solution fintechs are the top preferred provider.

“Customer retention, a major pain point for businesses, can be significantly enhanced through embedded finance tools. This is a critical differentiator that businesses must leverage, or they will be left behind,” said Nick Maynard, study author and Head of Research at Juniper Research. “As the demand for digital services continues to grow rapidly, there is significant market opportunity for businesses who go to market in an efficient, scalable manner.”

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