In 2008, Apple introduced the App Store and quietly created an entirely new business model. The iPhone was already a runaway success but opening it up to third party applications transformed a product into a platform with a growing ecosystem of services that could be integrated into something customers already used every day.
The same lesson applies to commerce today. Digital payments was focussed on enabling merchants to accept cards online, but that’s a challenge that has largely been solved. So now the opportunity lies in maximising what can happen the moment a payment takes place – whether that’s delivering extra value or stepping up convenience – the aim is to add new functionality and strengthen the relationship with customers.
Embedded finance has been around for years so the concept isn’t particularly new, but discussions persist as technology and expectations evolve. What was once a strategic ideal is now becoming reality.
Embedded payments are the starting point
Today’s customers simply expect their payment to work which is raising the bar for merchants – frictionless checkout therefore is critical. Payment flows that redirect customers to external banking pages or require manual steps are outdated, with studies showing that nearly 70% of online shopping carts are abandoned before purchase, typically because checkout was slow, confusing, or had hidden costs.
Speed and simplicity are expected, and payment choice is key. A recent survey found that 77% of UK shoppers expect payments to complete almost instantly, and 58% want one-click checkout – otherwise they’ll abandon their cart. Credit cards, digital wallets, account to account transfers and buy now pay later options all compete for attention, with another study reporting that 75% of buyers say having their preferred payment method turns a “would-be” buyer into a paying customer. Payment acceptance therefore isn’t a differentiator but the foundation on which the commerce experience is built.
Embedding financing at checkout
Embedded payments may have solved the acceptance problem, but the next challenge soon became clear – customers could pay but that didn’t always mean they could afford the purchase particularly for big ticket items.
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By GlobalDataIntegrating credit or buy now, pay later options directly into the purchase flow has shown to increase conversion rates and raise average order values. Multiple reports note that offering embedded financing at point-of-sale drives higher basket size and lower cart abandonment. A product that might have felt out of reach as a single payment can become manageable when divided into smaller instalments but what’s important is doing it responsibly.
BNPL has grown rapidly in the UK from virtually zero in 2017 to over £13 billion by 2024 – but this growth has understandably prompted greater regulatory scrutiny. New rules from the FCA, expected to come into force July 2026, will require clear upfront terms and affordability checks on all deferred-payment credit.
Embedded finance must work the way traditional banking does: offering flexible payment plans and transparent costs, without luring customers into unaffordable debt. When implemented correctly and responsibly, consumers should have flexibility while merchants can convert more sales.
Embedding subscriptions and recurring relationships
Not every innovation is about helping customers to spend more in one transaction, what’s also important is building long term relationships and repeat purchases. Subscription models are now ingrained into consumer habits, we are now able to sign up to anything from media streaming services to gym memberships to coffee deliveries on repeat. They’ve become a convenient way for customers to receive products and services but are a popular business model for a reason – steady customers are more valuable. Analysts note that subscription-based models foster customer stickiness and predictable revenue.
Embedding subscription management directly into apps or websites makes these models easier to maintain. Customers can sign up quickly, store their payment details securely and manage their plans through the same interface they used to purchase. Convenience plays a powerful role here. When billing and account management are integrated into an app or website, customers rarely need to think about the mechanics of payment.
Regulators are keeping a close eye here too, with new rules in the UK requiring that consumers be able to cancel a subscription as easily as they started them. Therefore, the most sustainable subscription businesses will be those that retain customers because they get value out of it, not because it’s simply too hard to leave. These new regulations are a positive move, ensuring that the relationship is maintained by choice.
Embedding currency conversion in global commerce
International ecommerce has become much easier for merchants but the checkout experience hasn’t always kept pace. Research shows nearly all international shoppers expect to pay in their own currency (94% in one study) and prefer payment methods that they recognise or are familiar with. Yet many encounter foreign currencies and conversion at checkout, often with unclear exchange rates and added fees. What often results is lost trust and abandoned carts.
Embedding currency conversion and multi-currency pricing directly into the checkout removes this barrier. Purchases can feel less risky and more familiar with clear local pricing and transparent exchange rates. As one global report notes, “57% of consumers choose where to buy based on available payment methods,” and virtually all expect local currency display. Merchants can effectively make a global storefront behave as though it was built locally by embedding currency tools as part of checkout.
Embedding value
For much of the past decade the fintech industry was defined by rapid experimentation. New startups launched payment models, lending services and digital wallets at remarkable speed. The environment today looks different. Venture funding has slowed, falling 42% in 2023, and regulators like the FCA and CMA are paying closer attention to consumer protection and market stability.
This shift is pushing the industry toward a more durable form of innovation – we are refining how existing services fit into everyday experiences rather than developing entirely new products. The companies that win won’t be the ones chasing the flashiest new payment gimmick that forces customers to adopt new systems, but those adding useful capabilities to the moments where transactions already occur.
By embedding value, whether that’s financing, loyalty programmes, real time FX, or data-driven personalisation, merchants can making the checkout experience richer and smoother, merchants can deepen loyalty, reduce friction, and strengthen long term customer relationships. Every payment touchpoint is an opportunity for more value.
Scott Dawson, CEO at DECTA UK
