Firms Report Improved Financial Performance Linked to Use of Embedded Finance

Why It Matters

Embedded finance is directly linked to improved financial performance and employee retention, making it a competitive differentiator across sectors. Companies that master implementation can secure stronger relationships and faster growth.

Key Takeaways

• 90% cite relationships over revenue as driver
• 75% plan upgrades within year, 37% within six months
• 61% of non‑payroll firms will add payroll features
• 93% face friction yet report high satisfaction
• 70% outsource delivery; trust drives provider selection

Pulse Analysis

Embedded finance has moved from a peripheral add‑on to a core strategic layer for businesses seeking deeper engagement with customers and employees. The PYMNTS Intelligence survey, which sampled 515 senior executives across banking, fintech, HR software, retail and technology, finds that almost nine out of ten firms now view financial services as a relationship‑building tool rather than a pure revenue generator. This mindset shift aligns with broader market data indicating that platforms offering seamless payments, lending or payroll experience higher user stickiness and cross‑sell opportunities, accelerating overall financial performance.

Implementation, however, remains a double‑edged sword. While 93 % of respondents acknowledge friction points such as platform transparency, technical integration and compliance, the same proportion rates their embedded finance capabilities as highly satisfactory. The paradox stems from the outsized payoff these services deliver, prompting 70 % of companies to outsource the heavy lifting to specialized providers. Trust and strategic alignment dominate partner selection, eclipsing cost considerations, which suggests that firms view the right ecosystem as a competitive moat rather than an expense line item.

Looking ahead, the momentum is unlikely to wane. With 61 % of firms lacking payroll functions planning to add them, employee financial wellness is emerging as a key talent retention lever. Retailers and tech firms are already accelerating upgrade cycles, signaling that speed to market will become a differentiator. Companies that invest early in robust, customizable embedded finance stacks and cultivate strong provider relationships can expect not only improved balance‑sheet metrics but also stronger brand loyalty, positioning themselves ahead of peers in an increasingly connected economy.