Top UK retailers report positive revenue impact from embedded finance

New research from leading retailers in the UK indicates that embedded finance could unlock significant incremental revenue between 4-7%, according to a report published today by NatWest Boxed and Boston Consulting Group (BCG).

Banking-as-a-Service (BaaS) allows retailers to partner with technology and/or banking providers to offer financial products and services to end customers. When retailers directly integrate financial products and services into the customer journey, this is referred to as embedded finance. Retailers have reported a 5-12% boost in conversion rates, a 15-30% increase in average order values, and a 4-7% incremental revenue growth overall from the use of embedded finance.

E-commerce has been a key driver of embedded finance growth, providing a widely adopted channel to reach customers. Research shows that segments with higher BaaS revenue tend to have higher e-commerce penetration of over 50%.

Technology platform capabilities and end-to-end customer support were identified as the top reasons for selecting a BaaS provider, more important than price.

Andrew Ellis, CEO, NatWest Boxed, said: “Embedded finance is reshaping the retail industry. With developments in cloud-native technology and product innovation converging, retailers are increasingly offering financial services and embedding them into customer journeys. But with an increasingly complex landscape of products, technology and suppliers to choose from, retail leaders need to ensure they focus on the right services with a trusted and secure BaaS partner to maximise the opportunity.”

Mark Dynes, managing director & partner, BCG: “BaaS and embedded finance is enabling all types of retailers to become a distributor of financial services. As our research shows, retail leaders can rely on embedded finance to meet a broader set of customer needs and maintain control of critical brand experiences. The results have been game changing, with a compelling impact on conversion, basket sizes and long-term engagement.”

The report explores:

  • The revenue potential for retailers is from the use of embedded finance, with a focus on fashion, home improvement, and marketplace sub-segments.
  • The key enablers driving the growth of embedded finance, including the correlation between e-commerce penetration and BaaS revenues across retail segments.
  • How embedded finance has enabled an evolving credit value chain, with credit cards at risk of cannibalisation vs POS financing, which shows growth potential.
  • How retailers can get started with their embedded finance journey, focusing on identifying customer needs, choosing the right products and services, and identifying a BaaS provider that clearly understands the business’s customers, products, technologies, operational context, and requirements.
  • The range of BaaS providers in the market today offering an array of capabilities. When selecting a BaaS provider, technology platform capabilities and end-to-end customer support were identified as the top selection criteria, which are more important than price.
  • In-house vs. capabilities provided by BaaS providers: Retailers interviewed chose to retain the front-end UI / UX, customer journeys, marketing, and branding in-house, leaving the provider responsible for the back-end technology, regulatory expertise, and operations.

To read the full research, download the white paper here.


Are you a member of The Payments Association?

Member benefits include free tickets, discounts to more tickets, elevated brand visibility and more. Sign in to book tickets and find out more.


Log in to access complimentary passes or discounts and access exclusive content as part of your membership. An auto-login link will be sent directly to your email.

Having trouble signing?

We use an auto-login link to ensure optimum security for your members hub. Simply enter your professional work e-mail address into the input area and you’ll receive a link to directly access your account.

First things first

Have you set up your Member account yet? If not, click here to do so.

Still not receiving your auto-login link?

Instead of using passwords, we e-mail you a link to log in to the site. This allows us to automatically verify you and apply member benefits based on your e-mail domain name.

Please click the button below which relates to the issue you’re having.

I didn't receive an e-mail

Tip: Check your spam

Sometimes our e-mails end up in spam. Make sure to check your spam folder for e-mails from The Payments Association

Tip: Check “other” tabs

Most modern e-mail clients now separate e-mails into different tabs. For example, Outlook has an “Other” tab, and Gmail has tabs for different types of e-mails, such as promotional.

Tip: Click the link within 60 minutes

For security reasons the link will expire after 60 minutes. Try submitting the login form again and wait a few seconds for the e-mail to arrive.

Tip: Only click once

The link will only work one time – once it’s been clicked, the link won’t log you in again. Instead, you’ll need to go back to the login screen and generate a new link.

Tip: Delete old login e-mails

Make sure you’re clicking the link on the most recent e-mail that’s been sent to you. We recommend deleting the e-mail once you’ve clicked the link.

Tip: Check your security policies

Some security systems will automatically click on links in e-mails to check for phishing, malware, viruses and other malicious threats. If these have been clicked, it won’t work when you try to click on the link.

Need to change your e-mail address?

For security reasons, e-mail address changes can only be complete by your Member Engagement Manager. Please contact the team directly for further help.

Still got a question?