2021 has also been the year that brands have started to embrace embedded finance as a potential tool to solve the issues. Smaller-scale companies have been leading the charge, offering innovative products built around embedded finance, from crypto rewards to interest rates linked to physical health. As they have provided these proofs of concept, bigger and bigger fish have started to explore the possibilities available to them.

In 2022 we expect to see an explosion of new embedded finance use cases - from consumer, sports and healthcare brands. Our research shows that young people, or 51% of 18 - 24-year-olds, are open to accessing financial services from brands they love and trust and 42% are interested in a credit card from their favourite sports team. To date, we have mainly seen embedded finance delivered as a standalone product, but by building experiences. there are also possibilities to create enhanced customer experiences with financial services built seamlessly in.

The potential here is enormous and largely untapped, with different opportunities available to different sectors. For example, football teams have a really passionate fan base who regularly buy tickets and merchandise from their favourite club. Through embedded finance experiences clubs could expand their offerings, going beyond the current tickets and merchandise paradigm to also connect fans to hotel and travel deals for away matches. All of this can be handled in one app with seamlessly integrated payment and the opportunity for fans to accrue loyalty points redeemable against exclusive experiences. This both removes any friction points around access to financial services and payment while improving the loyalty strategy.

We know that loyalty is an important consumer consideration. Some 38% of consumers feel more loyal to a brand if they receive rewards, for example. However, there is also widespread dissatisfaction with loyalty schemes. It isn’t difficult to see the issue - most loyalty schemes only reward customers when they spend with a specific brand, which limits how often consumers can engage with the scheme.

With a loyalty scheme built around an embedded finance experience, brands can expand their loyalty schemes to encompass any purchase their customer makes, which means they can be part of their daily lives in a positive way while building a stronger relationship. For example, we are working with McLaren and QNTMPAY on creating a debit card with unique F1 based rewards, up to and including pit lane access on a race weekend.

What is particularly exciting about embedded finance experiences is that we are just starting to scratch the surface of what is possible. As customers become more familiar with the seamless journeys they can take, the demand for these experiences will increase and brands will be able to innovate further and push the envelope for what is possible. We can’t wait to see how these experiences are going to evolve over the next twelve months!