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As embedded services take on added importance in payments and banking, financial institutions are adding the products at a faster clip, presenting payments processors with new business opportunities. On Thursday, the processor FIS launched FIS Embedded Banking Platform, which it says is its first embedded-finance platform designed for banks.
With the new platform, financial institutions can offer a range of services to corporate customers, using the software the banks have already adopted and routinely use, according to FIS. This is an expectation clients have expressed, as they prefer not to switch to separate platforms for a range of services, FIS says. With the new service, bank customers can open accounts and transfer funds within software they already use, the processor adds.
“Banks’ customers want banking built into the software they use to run their business every day,” says Jon Briggs, global head of embedded solutions and money movement at Jacksonville, Fla.-based FIS, in a statement.
Banks have similar expectations. The general trend toward embedded services in finance creates convenience for businesses but has led some observers to wonder whether financial institutions can maintain control of services they have traditionally offered, such as payments. FIS says its new service can allay that apprehension.
“Embedded Banking Platform lets banks meet … expectations and stay at the center of the relationship, while maintaining the regulatory control and customer ownership that define traditional banking,” notes Briggs, in a statement.
To leverage the new service, banks work with a vertical software company or fintech, weaving their own accounts and services into the partner’s product, FIS says. With this arrangement, the company notes in a summation of the service, “Corporate customers get an integrated banking experience without leaving the software they use daily. The bank keeps the customer relationship. The software partner owns the user experience. FIS powers the infrastructure.”
FIS recorded $2.48 billion in second-quarter revenue, up 6.1% from the same period last year. The company’s payments unit, the larger of two divisions at FIS, grew at 6.4%, to $1.48 billion in revenue.
