In this podcast episode, Lars Markull interviews Dr. Manuel Thomet, Associate Partner at Synpulse, about the first comprehensive study on Embedded Finance and Banking as a Service in Switzerland. The discussion covers key findings, market trends, and future predictions for the Swiss financial landscape.
Key Findings from the Swiss Embedded Finance Study
Over 75% of Swiss consumers have used embedded finance offerings at least once
The tipping point has been reached in three out of five banking service areas: payments, pensions, and investments
Neobanks are the embedders with the greatest attraction for consumers, followed by digital platforms and SaaS providers
More than 35% of Swiss banks are expanding their business model portfolio with Banking as a Service (BaaS)
Challenges and Opportunities for Swiss Banks
Implementing BaaS requires changes in mindset, culture, organization, and technology
90% of banks see cultural challenges as significant in adopting BaaS
64% of banks perceive technological challenges in implementing BaaS
Swiss banks are generally more reluctant to adopt BaaS due to their heritage in private banking
Future Predictions for Embedded Finance in Switzerland
Short-term (1-3 years):
Increased understanding of embedded finance as a strategic opportunity
Shift in discussion from open finance to embedded finance
Growth in consumer adoption, especially in payments and SME lending
Long-term (5-10 years):
Adoption shift towards digital platforms and traditional firms
Embedding financial services will become the new normal
Increased competition among banks offering BaaS
Technology will become vital for scaling BaaS profitably
Conclusion
The Swiss embedded finance market is poised for growth, with opportunities and challenges for banks and non-financial brands. As adoption increases and technology evolves, embedded finance is set to reshape the financial services landscape in Switzerland.