The impact of Banking as a Service (BaaS) on fintechs and banks is profound.
BaaS serves as the bedrock for a new era of financial services that are agile, accessible, and customer-centric. It allows fintechs and other third-party services to connect with the bank’s system through seamless API integrations, and build intuitive products on the bank’s regulated infrastructure.
On a global level, BaaS is poised to grow at a robust CAGR of 15.6% and is projected to reach an impressive USD 51.2 billion by 2028.
What does this mean for the fintechs and banks?
Let’s get into the details!
BaaS’s plug-and-play infrastructure empowers fintechs to focus on developing innovative products and services without the burden of building a full-scale banking infrastructure from scratch. Its ability to facilitate seamless expansion of services through rapid and effortless integration of banking services helps accelerate the pace of innovation in the fintech sector.
In tandem, BaaS opens new avenues for traditional banks by improving market relevance, enhancing customer acquisition and retention, and increasing customer base by tapping into previously unexplored customer segments. Banks can extend their reach beyond physical branches and offer services to a wider array of customers, including those in remote or underserved areas, by collaborating with fintech partners.
The BaaS-enabled collaboration with banks and non-banking entities has not only deepened financial inclusion but also created a win-win scenario for all stakeholders involved.
As we look ahead, it is evident that BaaS will foster a more inclusive and technologically advanced financial ecosystem.
It costs nothing to stay on top of all things fintech.