Embedded finance
Embedded finance is the layer that lets non-financial software companies and brands offer banking, cards, lending and insurance inside their own products. The category covers banking-as-a-service platforms, card issuing, embedded lending, payment facilitation and embedded insurance. The market reset hard in 2023-24 after a wave of BaaS bank consent orders (Synapse collapsed in April 2024, Blue Ridge, Choice and Evolve all hit enforcement actions), but the underlying volumes through Stripe Issuing, Marqeta, Unit and Treasury Prime kept growing on the back of vertical-SaaS and platform issuers.
It spans banking-as-a-service platforms, card issuing and processing, embedded lending and BNPL infrastructure, payment facilitation and PayFac-as-a-service, embedded insurance, treasury and FX-as-a-service, KYC and compliance-as-a-service, and sponsor banks providing the regulated chassis.
Revenue comes from interchange share split between the platform and the brand, monthly platform and per-card fees, take-rate on processed payment volume, revenue share on originated loan volume, and platform subscriptions for compliance and treasury tooling.
Embedded finance is part of Fintech.
$116B
Global market size
43
Public companies
Key VC investors
Key strategic buyers
How embedded finance companies monetize?
Embedded finance companies monetize through interchange share, payment processing take-rate and platform and per-card fees.
Interchange share
Per-transaction interchange split between issuer, processor (Marqeta, Stripe Issuing) and the platform brand. The dominant card-program revenue line and highly sensitive to debit-vs-credit mix.
Platform & per-card fees
Monthly platform fees plus per-active-card and per-transaction unit pricing. Used by Unit, Treasury Prime and Synctera to anchor revenue independent of interchange volatility.
Payment processing take-rate
Percentage of payment volume processed through the PayFac. Stripe Connect, Adyen for Platforms and Finix all monetise this line.
Embedded lending revenue share
Share of interest income or origination fees on loans originated through the platform. Used by Pipe, Parafin and Klarna for Platforms.
Embedded insurance commissions
Commission earned on policies sold through the embedded API. Cover Genius, Bolt and Sure cover the standard model.
Sponsor-bank revenue
Net interest margin and treasury earnings on customer deposits at the sponsor bank. The bank-side P&L behind the BaaS stack - Cross River, Column and Lead Bank.
Embedded finance valuations in May 2026
Public embedded finance comps trade at 2.2x EV/Revenue. Median revenue multiple across embedded finance M&A deals was 0.4x in the last 12 months. Median revenue multiple across embedded finance VC rounds was 8.8x in the last 12 months.
2.2x
Median EV/Revenue as of May 2026 for public embedded finance companies
1.5x
Block is the highest valued public embedded finance company based on EV/Revenue (excluding outliers)
0.4x
Median EV/Revenue across embedded finance M&A deals in the last 12 months
8.8x
Median EV/Revenue across embedded finance VC rounds in the last 12 months
Embedded finance market segments
Embedded finance spans banking-as-a-service platforms, card issuing and processing and payment facilitation.
Banking-as-a-service platforms
Middleware between sponsor banks and platforms. Unit, Treasury Prime and Synctera are the venture-backed names; Bond shut down in 2023; Column operates as a vertically integrated bank-and-software company.
Card issuing & processing
Issuer processors powering branded debit and credit programs. Marqeta is the public reference (NASDAQ: MQ); Stripe Issuing serves the platform side at scale; Galileo (SoFi) and Adyen Issuing compete.
Embedded lending infrastructure
API-first lending rails for vertical SaaS and marketplace platforms. Parafin, Pipe and Liberis are the venture-backed names; Klarna for Platforms and Affirm for Business power consumer-side embedded credit.
Payment facilitation & PayFac-as-a-service
Infrastructure for software platforms to onboard sub-merchants and process payments. Stripe Connect dominates the platform layer; Adyen for Platforms, Finix and Payrix cover vertical SaaS at scale.
Embedded insurance
APIs and platforms letting brands sell insurance at checkout. Cover Genius, Bolt and Sure anchor the category; Hippo and Lemonade embed property and renters via API.
Treasury & FX-as-a-service
Cross-border payouts, multi-currency accounts and treasury infrastructure for platforms. Modern Treasury, Wise Platform, Airwallex and Currencycloud (Visa) compete on different geographies.
Compliance-as-a-service
AML, transaction monitoring and BSA support sold to BaaS platforms and sponsor banks. Alloy, Hummingbird and Lithic's compliance modules cover the modern stack.
Sponsor banks
Chartered banks providing the regulated chassis for BaaS programs. Cross River and Column lead; Evolve, Pathward and Sutton remain active despite enforcement pressure since 2023.
Fractional CFO, financial modelling and deal advice for embedded finance companies
See how Flow helps embedded finance founders.
We speak founders' language and have great operational understanding of embedded finance businesses.
Book an intro call - we'll look under the hood and recommend concrete next steps.
Fractional CFO
For founders who want to improve their FP&A functions, build an investor-ready financial model, and prepare for the next VC round.
Capital raising
For bootstrapped and already-VC-backed entrepreneurs who are looking to raise late stage venture or growth capital.
M&A
For category-leading technology companies who are exploring exit alternatives with either financial or strategic acquirers.
Key embedded finance KPIs to track
Total payment volume, take rate, active cards and net revenue retention are the metrics investors track in embedded finance.
| KPI | Definition |
|---|---|
| Total payment volume (TPV) | Gross dollar volume processed through the platform. The headline scale metric for PayFacs and card issuers. |
| Take rate | Net revenue divided by TPV. Card-issuing take rates sit at 50-100bps net; PayFac take rates run 150-300bps gross. |
| Active cards | Cards issued and used in the period. The unit metric for Marqeta, Stripe Issuing and Galileo; correlates directly with interchange revenue. |
| ARR | Recurring platform and per-card fees. Sits beneath the volume-based revenue at Unit, Treasury Prime and Synctera. |
| Net revenue retention | Existing-customer revenue 12 months later. Healthy embedded-finance NRR sits at 115%+, driven by program expansion and volume growth. |
| Customer concentration | Percentage of revenue from top platform customer. Marqeta has historically run 60%+ from Block/Cash App; the public disclosure is read every quarter. |
| Gross margin | Card-issuing platforms run 40-55% (interchange pass-through dilutes margin); BaaS middleware platforms run 55-70%. |
| Programs live | Number of distinct branded programs operating on the platform. Reads platform extensibility for Unit, Treasury Prime and Marqeta. |
Main embedded finance players globally
The most active embedded finance companies and category leaders globally.
| Company | HQ | Overview |
|---|---|---|
Stripe stripe.com |  South San Francisco | Largest private payments and embedded-finance platform. Reported $1.4T in 2024 payment volume; tender offer in February 2025 priced the company at $91.5B. Connect, Issuing and Capital anchor the embedded-finance suite. |
Marqeta marqeta.com | Oakland | Largest standalone card-issuing platform (NASDAQ: MQ). Block/Cash App remains the anchor customer; Klarna, DoorDash, Uber and Affirm all run major programs on the platform. |
Adyen adyen.com |  Amsterdam | Public listed payments and embedded-finance platform (Euronext: ADYEN). Adyen for Platforms and Adyen Issuing serve large platform customers including Microsoft, eBay and Etsy. |
Unit unit.co | New York | Banking-as-a-service platform. Powers SMB-vertical fintechs and platform programs; raised $100M Series C in 2022 at a $1.2B valuation; subsequently downsized and refocused on enterprise customers. |
Treasury Prime treasuryprime.com | San Francisco | BaaS platform connecting fintechs directly to a network of sponsor banks. Raised $40M Series C in 2023; pivoted from intermediary to bank-direct model after the BaaS enforcement wave. |
Synctera synctera.com | Palo Alto | BaaS platform serving smaller community-bank-anchored programs. Raised $33M Series A extension in 2024; emphasises compliance ownership as a differentiator. |
Column column.com | San Francisco | Vertically integrated developer-facing bank founded by Plaid co-founder William Hockey. Sits between BaaS middleware and a chartered bank; powers programs for Brex, Stripe and Mercury. |
Cross River Bank crossriver.com | Fort Lee | Largest BaaS sponsor bank in the US. Powers card and lending programs for Affirm, Coinbase and Rocket; settled a 2023 FDIC consent order in 2025. |
Galileo Financial Technologies galileo-ft.com | Salt Lake City | Card issuing and processing platform; subsidiary of SoFi (NASDAQ: SOFI) after the $1.2B acquisition in 2020. Powers programs for Chime, Robinhood and Dave. |
Modern Treasury moderntreasury.com | San Francisco | Payment operations and embedded payments platform. Last valued at $2.2B in 2022; counts BlockFi, Pipe and Marqeta among customers. |
CFO-as-a-service without the overhead
Fractional CFO services priced for startups - senior operator, no permanent headcount.
Key embedded finance market trends
The BaaS enforcement wave, vertical SaaS embedded payments and FedNow embedded are reshaping embedded finance right now.
BaaS enforcement wave
Synapse collapsed in April 2024, leaving 100,000+ end users locked out of $96M of deposits. Blue Ridge, Choice and Evolve all hit FDIC and OCC consent orders through 2023-24; the wave forced BaaS platforms to take direct compliance ownership.
Stripe tender at $91.5B
Stripe's February 2025 tender offer cleared at a $91.5B valuation, up from $50B at the 2023 down round. Connect, Issuing and Treasury revenue all materially outgrew core payments; embedded-finance ARR is now a primary disclosure to investors.
Marqeta diversifies off Block
Marqeta secured renewed multi-year agreements with Klarna, DoorDash and Uber through 2024-25 to reduce Block customer concentration. Quarterly disclosures show Block share dropping from 70% in 2022 to roughly 45% by Q1 2026.
Visa Flexible Credential and platform issuing
Visa Flexible Credential and Mastercard One Credential launched in 2024-25 to let cards toggle between debit, credit and instalments. Marqeta, Stripe Issuing and Adyen are the early platform partners.
Vertical SaaS embedded payments
Toast, ServiceTitan and Shopify generate the majority of revenue from embedded payments. The model has spread to vertical SaaS leaders in healthcare, legal and field services through Stripe Connect and Adyen for Platforms partnerships.
FedNow and instant payments embedded
FedNow crossed 1,000 participating banks in early 2025 and instant payment volumes scaled. Modern Treasury, Lithic and Stripe rolled out FedNow APIs through 2024-25, broadening embedded-finance use cases into payouts and disbursements.
Similar verticals to embedded finance
Explore niches like Blockchain, crypto & web3, financial data & analytics, financial services software and InsurTech.
Explore other sectors
We know tech inside & out.
We live and breath tech - true understanding of how startups operate is fundamental at what we do.
Recent insights across embedded finance and beyond
Talk to us
Schedule a call to get a health check on your business and see how we could help.
Fractional CFO
- Fractional CFO for Software
- Fractional CFO for AI & ML
- Fractional CFO for Fintech
- Fractional CFO for Consumer internet
- Fractional CFO for Digital media
- Fractional CFO for E-commerce & marketplaces
- Fractional CFO for Consumer products
- Fractional CFO for Mobility
- Fractional CFO for Digital health
- Fractional CFO for Industrial technology
- Fractional CFO for Digital infrastructure
- Fractional CFO for IT services
Stages
Countries
- UK Fractional CFO
- Ireland Fractional CFO
- France Fractional CFO
- Germany Fractional CFO
- Spain Fractional CFO
- Portugal Fractional CFO
- Italy Fractional CFO
- Netherlands Fractional CFO
- Belgium Fractional CFO
- Switzerland Fractional CFO
- Austria Fractional CFO
- Denmark Fractional CFO
- Sweden Fractional CFO
- Norway Fractional CFO
- Finland Fractional CFO
- Poland Fractional CFO
- Estonia Fractional CFO
- US Fractional CFO
- Canada Fractional CFO
- Mexico Fractional CFO
- Brazil Fractional CFO
- UAE Fractional CFO
- Australia Fractional CFO
Cities
- London Fractional CFO
- Dublin Fractional CFO
- Paris Fractional CFO
- Berlin Fractional CFO
- Madrid Fractional CFO
- Lisbon Fractional CFO
- Milan Fractional CFO
- Amsterdam Fractional CFO
- Brussels Fractional CFO
- Zurich Fractional CFO
- Vienna Fractional CFO
- Copenhagen Fractional CFO
- Stockholm Fractional CFO
- Oslo Fractional CFO
- Helsinki Fractional CFO
- Warsaw Fractional CFO
- Tallinn Fractional CFO
- New York Fractional CFO
- Toronto Fractional CFO
- Mexico City Fractional CFO
- São Paulo Fractional CFO
- Dubai Fractional CFO
- Sydney Fractional CFO