Lecture series
Embedded finance for non-bank companies
Retailers, platforms, distributors and software companies increasingly offer payments, credit, insurance and savings inside their own products, often with a licensed financial institution behind them. This course explains the delivery models, who carries which responsibility, the main products and their economics, and the questions a company and its financial partner should settle before launch. Eight lessons.
8 of 8 lessons published. Lesson 1 is free to read.
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- 01What embedded finance is: financial services inside a non-financial businessEmbedded finance puts a financial service, such as a payment, a loan or an insurance policy, inside the product or purchase journey of a company whose main business is not finance. The company brings customers and data; a financial institution, or the company itself, provides the service. This lesson defines the term, describes the two delivery models, explains why non-financial companies take it up and sets out the first risks.
- 02Who does what: the brand, the licensed provider and the technology in betweenAn embedded financial service usually involves at least three parties: the company whose brand the customer sees, the licensed institution that provides the service, and often a technology firm that connects the two. This lesson sets out the tasks each may carry, where the money and the records sit, how responsibility stays with the licensed provider, and what the customer needs to be told.
- 03Licences and partnership models: referral, agency, banking-as-a-service and an own licenceA non-financial company can reach financial services in four main ways: by referring its customers to a provider, by acting as the provider's agent, by offering the provider's product under its own brand, or by obtaining a licence itself. This lesson describes each model, what the company does and does not do in it, and what changes in control, obligations and cost as it moves from one to the next.
- 04Embedded payments and wallets: collecting, paying and holding moneyFor large technology firms, payments were the first financial service they offered. Collecting money at checkout and paying it out to sellers can be left to a licensed provider, but holding customers' money in a wallet creates a debt to those customers that must be protected. This lesson explains the three payment functions, the money held in between, how customers' funds are safeguarded and what happens if a party fails.
- 05Embedded credit: paying later, merchant finance and supplier creditCredit embedded in a purchase or a platform takes three common forms: instalments for a consumer at checkout, working capital for a seller on a platform, and stock on credit for a shop supplied by a distributor. This lesson explains how each works, who pays for it, how repayment is collected, what the evidence says about the risks and what a company should settle before offering credit.
- 06Embedded insurance and savings: cover and balances sold with a purchaseInsurance and savings are often offered at the moment of a purchase, a loan or a payment: cover for a loan or a device, protection given away as a loyalty benefit, or a wallet balance placed in a fund. This lesson explains the common forms, what supervisors have found about value for money and customer awareness, how the design of the journey shapes what customers end up with, and what a company should settle before offering cover or savings.
- 07Protecting customers: disclosure, consent, data and complaints in a shared journeyIn embedded finance the customer sees one brand, while the product, the data and the duty to the customer are shared between a company and a licensed provider. This lesson sets out what the international principles say about responsibility for intermediaries, disclosure, the use of personal data and complaints, and how a company and its provider can divide that work without leaving a gap for the customer.
- 08The business case: revenue, losses, partner risk and moving from pilot to scaleAn embedded financial service pays only if what it brings in exceeds what it costs, including the losses someone must carry and the risk that the partner relationship fails. This lesson sets out where the revenue comes from, how to add up a simple contribution, who carries credit losses, how a licensed provider manages the risk of its partner, and what changes when a pilot is scaled up.
Quiz and certificate 10 questions; those on lesson 1 are free to try. Read every published lesson and score 80% or more for a certificate of completion.
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