5 Industries Using Embedded Financial services in 2023

Embedded financial services, commonly referred to as "banking-as-a-service," is a business model where financial services are integrated into the products and services of non-financial companies. As we are now in 2023, we can expect this model to become even more prevalent as companies are consistently seeking ways to add value for their customers in addition to streamlining their operations. 

That’s a lot to take in from the jump but it covers the basic idea of how BaaS fits into the generic landscape of businesses. This is yet another versatile piece of technology that can transform an organization's operations from the ground up.

2 Leading Factors Behind the Adoption

Demand for convenience: The first key driver behind the growth of embedded financial services is the increasing demand for convenience. Customers today expect to be able to access financial services on their own terms. To accommodate this, companies must offer flexible, high-performance experiences that allow users to manage their finances from anywhere, at any time. By integrating financial services directly into their products/services, companies can provide a one-stop-shop experience.

Data privacy and security: As data breaches become more common and customers become more concerned about the handling of their personal information, companies that can ensure and offer secure financial services are likely to be more attractive to consumers. By embedding financial services into their products and systems, companies can better control and protect their customers' data, which can give them greater confidence in using their services.

How Companies Are Capitalizing

There are several different ways that companies can use embedded financial services to benefit their customers as well as their operations. Every industry is searching for the best way to apply this. With that said, here are 5 that have found some success in doing so: 

1. E-commerce: Many e-commerce companies, such as Shopify and Amazon, offer embedded financial services like financing options and payment processing. This allows customers to make purchases and pay for them over time, rather than having to pay upfront, which can increase sales and customer satisfaction (BNPL).

2. Travel: Companies in the travel industry, such as Expedia and Airbnb, often use embedded financial services to offer a range of payment options, one of which includes the ability to pay in different currencies. This can be especially useful for travellers who are visiting a country for the first time and aren’t familiar with the local currency.

3. Retail: Retail companies, such as Target and Walmart, are using embedded financial services to offer customers more convenient ways to pay for their purchases. For example, Walmart allows for payment through its mobile app, Walmart Pay, which allows customers to simply make purchases using their smartphone.

4. Technology companies: This one may not come as a surprise, but tech companies, such as Apple and Google, are using embedded financial services to offer financial products, such as credit cards and mobile banking apps. This allows them to expand their customer base and generate even more streams of revenue.

5. Telecommunications companies: Telecommunications companies, such as AT&T and Verizon, are using embedded financial services to provide direct access to financial services such as mobile banking and payment. This is great for increasing customer loyalty and retention.

The Takeaway

As we can see, it’s clear that embedded financial services will continue to play an important role in the economy during 2023 and in the years to come. As companies try to provide more value for their customers and streamline their operations, the integration of financial services into their products and services will continue to prevail. 

The hardest thing to do as a company with long-standing operating methods is to implement change. However, in this day and age, change is inevitable for those who plan to capitalize on the modern market. 

Written By Ben Brown

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ISU Corp is an award-winning software development company, with over 17 years of experience in multiple industries, providing cost-effective custom software development, technology management, and IT outsourcing.

Our unique owners’ mindset reduces development costs and fast-tracks timelines. We help craft the specifications of your project based on your company's needs, to produce the best ROI. Find out why startups, all the way to fortune 500 companies like General Electric, Heinz, and many others have trusted us with their projects. Contact us here.

Super Apps: What are they? How can you use them?

We talk a lot about adapting to change and how change is an inevitable factor when running a business. One of the biggest changes to ever hit businesses and the world as a whole is the integration of technology which we have to remember has not been around for that long in retrospect. People are still finding new ways to utilize technology at its maximum potential which does not come without its unique demands. 

Applications are a great example when considering the changes technology makes in people's lives on a day-to-day basis. A good user experience is the focal point of any application or website which means variety in your product or service has to be a staple. When it comes to customer retention in the digital market, having a platform that is multi-function is a huge bonus. These are known as Super Apps, which essentially act as a hub for companies to interconnect various applications in one spot.

The term “Super App” was originally coined by the founder of Blackberry Mike Lazaridis. Lazaridis saw this as a way to enhance the user experience of applications and it has since become a viable option for many businesses globally.

A Few Reasons Companies Might Use a Super App Include:  

• Branding: When organizations have a wide variety of products and services that are delivered through one app, their credibility and recognition grow among consumers. 

• Access to a bigger audience: When using a Super App, the types of offers a business provides can easily be catered to a variety of consumer niches. In contrast to a singular focused application, this provides more of an opportunity to have a diverse audience.

• Revenue streams: Thanks to APIs and savvy software engineering, the amount of services a business can offer is seemingly endless in a Super App. In addition, the cost of customer acquisition is next to nothing. 

• Increased engagement: Super Apps provide touch points and lots of them. This helps the interactive aspect of your application and will increase the duration of user visits.

• Low costs: Taking one solution and using it as an umbrella to add more services are going to save companies in the long run. This is because one app is more inexpensive and easy to manage than multiple applications (which would become pits to throw money into and a headache for software developers).

Software innovation and engineering are always centered around the consumer. For brands to make a name for themselves today, they understand application programming and functionality are crucial to creating a great user experience. 

How it Works:

So what kind of services would a Super App help a business deliver in one singular application? Financial services are the best place to look if you want a glimpse of Super App technology in action. A financial Super App will let users view account balances, make transactions, make investments, track/manage subscriptions, and much more. All of these functions in a Super App are now in one place as opposed to users having to go to different websites or platforms for different services. 

Developing a Super App

Since a system like this is highly complex, there’s a variety of components you’ll want to ensure go into the application:

Service interaction: Since there are numerous channels of service and users bouncing from one to another, their effectiveness and operating speed have to be consistent. What this means for software developers of the Super App is that performance should be high even with spotty internet, screen transition must be seamless, and no errors should impact users from accessing multiple services at a time.

Promote data sharing: Unlike your typical mobile app, the user's data such as delivery address and ID should be easily accessible to them across all in-app services. Additionally, prior actions and sessions should carry over from service to service to have consistent performance.

Exceptional UI/UX: This is a focal point for Super App development. The visual landscape and experience of using the Super App have to be consistent regardless of how many actions it’s performing.

Security: The convenience aspect of having access to multiple services in one spot is great, but it puts Super Apps in a position of major liability since they are now in possession of sensitive information on their users.

This becomes tricky for Super Apps since there is no margin for error in this area. In comparison to traditional mobile applications, this process is far more complicated. However, this merely puts more of an emphasis on security for software developers which means it’s a good starting point to sort out logistics during the planning process.

The Market for Super Apps 

The amount of internet users has grown to over 5 billion people and last year around 230 billion mobile apps were downloaded. The demand for technology that enhances the efficiency and experience of using applications is growing with these numbers and boosting revenues for companies making it work. 

Think about your day-to-day; there’s likely less than a handful of apps you use regularly. How do these apps help you? How do you think they help others? Would it be easier to have all of them in one application?

Of course, Super Apps aren’t going to put TikTok, Instagram, FaceTime, and your mobile banking apps in one, but you get the idea.

The Takeaway

Super Apps still have a ways to go before they can dominate North American markets. Right now, they are dominating markets, particularly in South America and Asia where the market size for mobile service is still hundreds of billions of dollars. Soon enough, we can expect this technology to enter the western markets, and when that time comes, businesses will be preparing to dominate with it.

Written By Ben Brown

—

ISU Corp is an award-winning software development company, with over 17 years of experience in multiple industries, providing cost-effective custom software development, technology management, and IT outsourcing.

Our unique owners’ mindset reduces development costs and fast-tracks timelines. We help craft the specifications of your project based on your company's needs, to produce the best ROI. Find out why startups, all the way to fortune 500 companies like General Electric, Heinz, and many others have trusted us with their projects. Contact us here.

The Benefits of API Development for Businesses

How has the internet supported your life? Is it how you can run your business? Stay in touch with friends and family? Maybe you use the internet in your leisure time. No matter what the case may be, the internet you know today doesn’t exist without Application Programming Interfaces (APIs). This term may seem intimidating if you are unfamiliar with the concept, so we’re going to have to break it down.

In simple terms, imagine trying to talk to someone in another country without any method for transmitting messages (video calls, phone calls, instant messaging, pen and paper, etc). You’d just be talking to yourself. The API would, in this case, be the devices that make this communication possible. It is software that lets applications communicate. You ask the API for it, and the API goes and gets it for you. 

How do APIs help businesses?

Imagine you want a website for your business that’s going to provide an amazing and unique experience for your users, lightyears from what your competitors are using. You’ll need software that can materialize the concepts through various features in your website and allow it to perform at a high level. For this reason, you’ll look for a web developer who can create an API for your website.

You’re likely seeing the pattern here. APIs expand the potential that businesses can tap into when it comes to scaling the business. Disparate systems are holding back the worthwhile investment for businesses that are currently spending nearly $600 billion annually trying to crack the code. 

Create and Innovate 

So with the idea of innovation in mind, let’s consider the ways that API technology makes expansion possible. When it comes to change in an organization, especially digital transformation, APIs allow people to contribute more and more to the success of the organization by breaking the barriers instilled by traditional methods. As well, monetization is far easier to implement by allowing companies to own real estate on multiple platforms (where more ad space can be sold). 

For services that are driven by advertising or that are “transactional”, having various interfaces will continue to enhance that exposure. With that in mind, have your APIs directed towards a variety of platforms such as browser extensions, Meta, iPhone, and more. 

How can you prepare?

What kind of API is your business developing? Is it meant for developers? Or is this something that’s going to help the third party? Like any software implementation, you need to identify the important aspects that will cover logistics. In the case of APIs, these areas include: 

• The functionalities you want your API to perform and how many. Is there anything you can automate to assist with maintenance and use? 

• How will the API be accessed and who will access it? Are you going to integrate it through an already-established platform? Will it only be available to partners or the public?

• Is your API going to offer support? If so, how much? (This will dictate some of the decisions you make with development so ensure it is taken care of beforehand).

What to do during execution

There’s an abundance of tools to assist in your API development journey, but before you search for them, you need to know your app. The type of data and information you plan to use in the API is fundamental, which means the developer will need to know it or else they’ll be overwhelmed by the app's requirements upon release.

How APIs have helped businesses you know

APIs give businesses the chance to expand into new markets. There are strategic partnership opportunities and technology changes that can bring businesses to the next level. Take Uber for example. Rather than going through the process of creating their own communication, navigation, and transaction methods, they took the top programs for all those aspects and used APIs to link them. 

Also, if you recall the start of Twitter, you’ll remember that it wasn’t perfect. Specifically, their user interface (UI) was not up to standard which required attention. TweetDeck came in and created a far better UI than Twitter's original engine which led to a much more smooth user experience.

What to expect in the next decade

You’ve heard it over and over again: “technology is the future”. This article has certainly spoken plenty of its potential in overtaking traditional methods. Businesses need to be pragmatic when it comes to changes like API technology. Traditional methods involve paperwork, a big sales staff, and many other outlets where companies will invest time and money while seeing little to no reciprocity from today.

The Takeaway

Software solutions is a broad term, but APIs are a very good example to consider when evaluating what it will mean for your business. There’s a variety of opinions on how to “future-proof'' your company, but the fact of the matter is that every business is different. 

At this point, there is almost no business that operates without digital solutions and everyone would’ve had to evaluate and identify their own needs and logistics. This is important, but you’ll need to consult with professionals at some point to get ahead of the competition.

Written By Ben Brown

—

ISU Corp is an award-winning software development company, with over 17 years of experience in multiple industries, providing cost-effective custom software development, technology management, and IT outsourcing.

Our unique owners’ mindset reduces development costs and fast-tracks timelines. We help craft the specifications of your project based on your company's needs, to produce the best ROI. Find out why startups, all the way to fortune 500 companies like General Electric, Heinz, and many others have trusted us with their projects. Contact us here.