Embedded finance will be worth $3.5 trillion to the global retail sector, according to new research from cloud banking platform Mambu.
The study also revealed that the retail sector could account for 49 per cent of the embedded finance market within the next ten years.
Retail lending represents almost a third – 29 per cent – of the embedded finance market.
Mambu said that the digitalisation of retail services set to drive increased adoption of digital wallets and flexible finance options, such as point of sale lending and ‘Buy Now Pay Later’ services.
“We’re moving towards a ‘fourth industrial revolution’ where financial institutions need to take strategic decisions to fully capture the opportunities offered by embedded finance,” said Eugene Danilkis, chief executive, Mambu. “The report illustrates the size of the opportunity within grasp, but it means financial institutions like banks must think, act and be tech-empowered like FinTechs. For banks to compete effectively, they must also invest in technology to build and enhance their own digital offerings.”
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