A research conducted by Temenos showed that over the past 12 months, three in five Britons have used integrated financial services as part of the checkout process when shopping online.
Over the years, the popularity of online financial offers provided by non-financial companies has grown, becoming increasingly available. These include e-wallets (which have been used by 42% of UK adults in the past 12 months), Buy Now, Pay Later (BNPL) solutions (which have been used by 17% of people).
Part of a particularly new and ever-changing market, integrated financial services are popular with younger generations. The study conducted by Temenos shows that four people in the 18-34 age group have used one of these services at least once in the past year.
According to Temenos, brands are beginning to integrate financial services into their online and mobile offerings to increase revenue, build customer loyalty and gain deeper insights into their customers. This represents new opportunities for incumbent banks and even for relatively new entrants such as banking-as-a-service (BaaS) providers.
Defining integrated finance and BaaS
Currently, the bank is beginning to be integrated into cross-industry digital ecosystems through BaaS models. BaaS offers a different approach to financial services, accelerating the democratization of banking and its transformation into a platform economy.
The model helps the end customer benefit from the provision of banking and financial services in an end-to-end personalized customer journey designed to meet their unmet needs, delivered to the right point of contact with real-time, intelligent and contextual experiences. .
As found in research conducted by Temenos, 76% of respondents say they are more likely to use BaaS as a route to market since COVID-19. Additionally, 80% of respondents say BaaS is a way to expand reach to new geographies and a majority of 92% of respondents say BaaS is a faster way to bring products to market than to sell them. build in-house.
E-wallets and BNPL
The concept of consumer credit and installment loans, BNPL, is integrating into the user’s shopping experience, changing the economics of traditional loans, from loan spreads levied on customers to merchant commissions .
Research by Temenos shows that of those who have paid with an e-wallet, 72% do so at least once a month, with speed (66%) and security (40%) being rated by users as the most attractive factors.
According to the Temenos survey, which involved 2,000 people, 54% of UK BNPL users say the fast-paced nature of BNPL draws them to the service, the most often cited benefit, followed by its user-friendliness (31 %), and that they recognize and trust the brand they interact with (30%).
However, with inflation and the rising cost of living, affordability and responsible lending are growing concerns, and legislation is imminent in the UK.
