Adyen (ADYEN:AMS), the financial technology platform of choice for leading businesses, has today launched a new report with Boston Consulting Group (BCG) which reveals a game-changing $185 billion market opportunity for SaaS platforms, a substantial 25% increase since 2022.
BCG’s analysis reveals this market growth is driven by a “favorable” interest rate environment — due to higher bank revenues from accounts — as well as an overall “expansion of banking revenue pools.”
In parallel, the demand for embedded finance from small-and-medium-sized businesses (SMBs) — a sector underserved by traditional financial institutions — has broadened beyond payments.
This, coupled with the market’s expansion, opens a key opportunity for SaaS platforms to embed into their offerings financial products like business accounts, loans, and issued cards.
Given typical margins on these products, most platforms have an opportunity to multiply their “current revenues by up to three or four times.”
The market is primed with strong demand from SMBs with 50% of SMBs expressing a high likelihood of “utilizing a full suite of embedded finance products in the near future, reinforcing its growth potential.”
The report highlights that top platforms are now “generating more than 50% of their revenues from embedded payments and finance, and shines a light on embedded finance as the next critical growth lever for SaaS.”
To differentiate in an increasingly competitive market, platforms “must consider integrating financial products in their offering.”
Adyen and BCG’s report provides a playbook for SaaS platforms “looking to succeed in the embedded finance space.”
It outlines actionable insights on differentiating products from “traditional banks, optimizing go-to-market strategies, and forming effective partnerships to drive growth.”
Methodology
In partnership with Boston Consulting Group, to reassess the state of embedded finance for SaaS platforms in 2024, we conducted quantitative and qualitative research with ~30 leading platforms and ~2,000 SMBs across North America, Europe and Australia in eight industries — including F&B, Retail and Hospitality.
Adyen is the financial technology platform of choice for leading companies.
By providing payments capabilities, insights, and financial products in a single global solution, Adyen helps businesses achieve their objectives.
With offices across the globe, Adyen works with Meta, Uber, H&M, eBay, and Microsoft.
Boston Consulting Group partners with professionals in business and society to tackle their most “important challenges and capture their greatest opportunities.”
BCG was the first-mover in business strategy when it was founded in 1963. Today, we work closely with clients to embrace “a transformational approach aimed at benefiting all stakeholders—empowering organizations to grow, build sustainable competitive advantage, and drive positive societal impact.”
As noted in the update, 2,000 small-and-medium-sized businesses (SMBs) surveyed across eight industries – “including Food and Beverage (F&B), Hospitality and Retail – in Europe, North America and Australia.”
