Embedded Finance

CHAPTER THREEBIG TECH AND BEYOND

In Chapter 2, we explored the history of financial services, which have been intrinsic to society since its earliest days. As technology has advanced, more sophisticated financial systems have been developed to connect with customers. Money has grown increasingly abstract and the customer deals with it at a distance, even invisibly. Embedded finance plays a crucial role as part of this evolution, where financial products are offered in non-financial contexts.

In this chapter, we will explore how technology companies are implementing embedded finance to better serve their customers and the impact it has on the customer and on their business model.

A MATCH MADE IN HEAVEN

Oftentimes, whether it be on the news or through social media, we hear about the Big Tech companies, the companies like Facebook, Amazon, Google, Apple, and others. We call out these four in particular because the total market cap for these four tech giants as of mid-2020 was over $5 trillion and they continue to be four of the five most valuable American companies to trade on public markets.¹ How often do you engage with one of these four players? Our guess is that you engage with a few if not all of them multiple times a day. Big Tech companies have huge audiences and are as much part of our lives as waking up in the morning. It seems that Big Tech has dabbled in just about every market and financial services is no exception. Big Tech companies have been moving into financial ...