by The embedded lending market provides a platform for customers to select and obtain customized loan products during checkout on e-commerce and other digital sales channels without leaving the platform. Embedded lending solutions integrate directly into a merchant or partner’s digital experience and allow the consumer to understand financing options and apply for a loan within minutes.
The Global Embedded Lending Market is estimated to be valued at US$ 6.35 Bn in 2024 and is expected to exhibit a CAGR of 20% over the forecast period 2024 To 2031.
Key Takeaways
Key players operating in the embedded lending market include Affirm, Afterpay, Alchemy, Banxware, Biz2X, Finastra, Hokodo, Jaris, Kanmon, Klarna , Lendflow, Liberis, Migo, Sivo, Stripe, Inc., Tapwater, Turnkey Lender, and Zopa Bank Limited. These players are focusing on developing innovative embedded lending solutions and expanding their customer base globally.
Growing demand: There is a growing demand for Embedded Lending Market Size solutions among e-commerce businesses, fintech companies, and digital merchants to enhance the customer shopping experience and drive sales. Embedded lending allows consumers to pay seamlessly in incremental installments directly at checkout.
Global expansion: Leading embedded lending providers are expanding their global footprint and entering into strategic partnerships with digital merchants, banks, and fintech enterprises across countries. The market is expected to witness significant growth in developing economies due to rising internet penetration and the increased adoption of digital payments and financing options.
Market key trends
Real-time underwriting is emerging as a key trend in the embedded lending market. Using APIs and complex algorithms, embedded lending platforms can analyze thousands of data points in real-time to instantly determine a customer’s creditworthiness and instantly approve loans at checkout. This removes lengthy application processes and allows customers to obtain customized financing on the spot. Real-time underwriting helps drive higher conversion rates for merchants while enhancing customer experience.
Porter’s Analysis
Threat of new entrants: Embedded lending providers have to comply with strict regulations which require high investment and make entry difficult.
Bargaining power of buyers: Buyers have significant bargaining power as they can choose from multiple Embedded Lending Market Size providers.
Bargaining power of suppliers: Providers of core banking systems and digital platforms enjoy bargaining power as few alternatives are available.
Threat of new substitutes: Alternatives like save now pay later or installment payment options pose threat as substitutes.
Competitive rivalry: Intense competition exists among leading players to capture more market share through technological innovation and partnerships.
Geographical Regions
North America currently holds the largest share of the embedded lending market in terms of value due to high demand for instant loans.
Asia Pacific is expected to witness the fastest growth during the forecast period owing to rising penetration of fintech companies and increasing adoption of digital lending platforms across developing economies like India and China.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
