Embedded finance enables brands to offer financial services like payments, branded cards, flexible credentials, and dynamic rewards directly within their own platforms. This creates seamless, contextual experiences that keep customers engaged without redirecting them to traditional banks. Brands leverage customer data to personalize interactions, reinforce brand presence at every transaction, and deliver the flexible payment options customers now expect, driving both acquisition and long-term loyalty.
In today's competitive market, where customer loyalty is on the decline and customer acquisition costs are soaring, brands are being challenged even more to stand out and deliver exceptional value. Traditional strategies are no longer sufficient for retaining customers and maximizing their lifetime value, especially in dynamic sectors such as retail, travel, and technology. This is where embedded payment solutions can help, by harnessing customer data to transform how customers interact with your brand.
This is especially important today. According to recent research from Clevertap, acquiring a new customer is now 5x to 25x more expensive than retaining one. At the same time, customer loyalty has declined by 14% from 2022 to 2023, illustrated by the customer loyalty index from Emarsys.
What Is Embedded Finance?
Embedded finance is the integration of financial services, such as payments, lending, or insurance, into non-financial platforms and apps, allowing brands outside the banking sector to offer these services directly within their own customer experiences.
Through Banking as a Service (BaaS) platforms and partnerships with regulated banks (often via BIN sponsorship arrangements), non-financial brands can launch financial products without building full-stack banking infrastructure themselves.
Common embedded finance offerings include:
- Seamless digital payments
- Branded credit and debit cards
- Customized, dynamic rewards programs
- Flexible credentials: a single card that adapts to debit, credit, BNPL, and more
Incorporating these into your digital offerings can enable you to leverage embedded payments that increase customer loyalty, reinforce your brand, and extend customer value.
Embedded Finance Use Cases Across Industries
Consumer demand for embedded finance spans multiple verticals. According to Cornerstone Advisors research, interest is strong across diverse industries:
- Gaming:In-game deposit accounts for managing virtual and real-world purchases
- Fitness:Behavior-based insurance products tied to health and activity data
- Fashion:Luxury brand investment accounts linked to high-end retail experiences
- Automotive:Usage-based auto insurance integrated into connected vehicle platforms
- Home improvement:Savings accounts designed for renovation and project financing
This breadth of demand demonstrates that embedded finance opportunities extend far beyond traditional retail and fintech applications.
Why Retail Is Positioned to Win
Of all the verticals embracing embedded finance, retail may be the best positioned to capture value, and the data backs it up.
Retailers already hold the two things that make embedded finance work: an established brand relationship and rich transaction data. Marqeta's 2026 State of Credit Report found that 71% of SMBs are more likely to use a card from a vendor they already do business with if that vendor offers personalized rewards based on their spending habits. The relationship exists. The data exists. Embedded finance is what connects them into a product customers actively prefer.
Retail also leads the appetite for the next generation of payment products. Among industries surveyed, retail SMBs showed the highest interest in flexible credentials (cards that can switch between credit, debit, and BNPL at the point of purchase), ahead of both technology and financial services. And consumer trust in non-bank providers, the foundation embedded finance is built on, has reached a tipping point: 66% of SMBs are now comfortable using financial services from non-banks, rising to 83% among those planning to apply for a credit card in the next 12 months.
The takeaway for retail leaders is direct. A retailer with a strong brand and an engaged customer base now has a credible foundation to offer the kind of modern, flexible payment products customers once expected only from a bank. The question is which brands act on it first.
Customer Retention Strategies with Embedded Payments
Improving customer loyalty with embedded payment solutions isn't just about collecting points. It's about creating meaningful, personalized interactions. The key is harnessing customer data and coupling it with embedded finance to create dynamic and customized loyalty programs that customers prefer.
According to research led by FinTech magazine, 52% of 25–34-year-olds said using financial products and services from their favorite brands was their payment option of choice, and more convenient than using a conventional bank. Additionally, 56% of U.S. respondents said they would consider getting financial services from a non-financial provider, signaling broad consumer appetite for brand-delivered financial experiences.
That appetite is reshaping what loyalty products need to do. The traditional single-brand co-brand card is showing real strain: in the 2026 State of Credit Report, 64% of consumers aged 18–44 said they'd prefer co-brand rewards that work across multiple brands rather than being locked to one. The most effective retention play is no longer a card that only matters inside your store. It's a flexible, brand-anchored credential that carries the relationship wherever the customer goes.
Boost Customer Engagement Through Contextual Financial Services
Embedded finance transforms the customer value proposition by delivering financial services within the context of what customers are already doing. Instead of redirecting users to a traditional bank, embedded finance allows customers to access payments, credit, and rewards seamlessly within their journey, creating a more streamlined, convenient experience while helping businesses unlock new revenue streams and deepen customer relationships.
Nowhere is that context more valuable than at checkout. Customers today are already orchestrating their own payments: 59% of consumers used both debit and credit in the past 90 days, and 79% of BNPL users keep using BNPL even after they have credit card access. They're switching constantly, based on what they're buying and how their month is going. Embedded finance lets you meet that behavior head-on, putting the right payment options inside the moment of purchase rather than forcing customers to leave your experience to find them.
Reinforce Your Brand at Every Touchpoint
Enhancing the customer experience through embedded finance solutions enables you to put your brand front and center. Branded cards that integrate with your customer experience ensure that every financial interaction focuses the customer on your brand, rather than on a third-party payments provider.
In fact, according to that same FinTech Magazine research cited above, 62% of co-branded credit cardholders consider themselves a customer of the brand or store instead of the bank. This continuous exposure helps your brand remain top of mind for your customers (and your customers' customers), driving increased interactions and cross-selling opportunities.
There's room to extend that brand relationship even further. Interest in co-brand debit is notable and growing: 33% of consumers express interest in co-brand debit cards, rising to 41% among 18–44 year olds. For retailers whose customers want the brand relationship but aren't well served by traditional co-brand credit, a brand-anchored debit credential, with BNPL layered in for financing flexibility, extends your brand into a payment product without requiring customers to qualify for revolving credit.
Differentiate the Customer Experience with Flexible Credentials
What is a flexible credential? A flexible credential is a single payment card that can switch between debit, credit, BNPL, and other payment types at the point of purchase, letting customers choose how to pay in real time.
Expanding your brand's footprint with customers does more than remove barriers to future purchases. Employing modern payments technology helps you:
- Stay ahead of the competitionby adding customer value through advanced payment solutions tailored to customer needs
- Deliver an experience that delights loyal customersby providing a consistently seamless transaction for them, time and time again
- Expand beyond your core business modelby readily offering more banking services and capabilities within your app or website
The demand for flexible credentials is explicit: 48% of consumers aged 18–44 want a single card that can switch between payment types at checkout, and among customers already carrying multiple cards, that number climbs to 71%. They're already doing this work manually, by shuffling between cards and apps. A flexible credential does it for them, on one card.
The appetite to consolidate is striking. Among consumers interested in flexible credentials, 67% would replace their current debit card with one, 71% would replace their credit card, and 71% would stop using separate BNPL apps. For the customers who want it, the flexible credential isn't another card layered onto the wallet. It's the card that earns top-of-wallet status outright.
Marqeta's open API and cloud-native payments platform grant the flexibility to design and launch a personalized card program that reflects the unique needs of your audience. With over 370 APIs (including more than 100 dedicated to credit services) and prebuilt UX/UI templates, we empower you to create an engaging and interactive card experience. Our unique underwriting capabilities also allow you to use alternative data for customer history, expanding access to credit for a broader customer base. And as the first issuer processor in the U.S. certified to enable Flexible Credentials, Marqeta has already brought multiple programs to market at scale.
Case study: See how Klarna gave its consumers a better online shopping experience by offering simple and safe solutions that empowered consumers with more financial freedom, control, and the flexibility to purchase what they want, all by partnering with Marqeta, which powers the new Klarna debit card in the U.S. Read more here.
Improve Customer Acquisition Strategies with Instant Scalability and Flexibility
Imagine if you could offer rewards and incentives in real time, based on current customer data or market conditions, such as instantly issuing virtual cards, making decisions on credit applications, and adjusting your offerings either through an intuitive dashboard or directly via APIs. Marqeta's architecture delivers financial tools that are as agile as the rest of your business, accelerating product development and democratizing access to sophisticated card-issuing technology, making it available to businesses of all sizes.
Benefits of Embedded Finance to Drive Customer Loyalty and Acquisition
The benefits of embedded finance for customer acquisition are clear, and the near-term pipeline is real: 22% of consumers and 33% of SMBs plan to apply for a credit card in the next 12 months, according to Marqeta's 2026 State of Credit Report, and their preferences skew heavily toward exactly the flexible, brand-anchored products embedded finance makes possible. A branded card backed by compelling, adaptable rewards offers an opening into this high-intent, near-term audience.
Three core benefits of embedded finance for brands:
- Increased revenue through new financial product offerings
- Enhanced customer loyalty through seamless branded experiences
- Greater long-term customer relationship value through deeper engagement
With a partner like Marqeta, you can create a truly differentiated experience designed to attract and acquire new customers, setting your brand apart in a crowded market. Get in touch with our sales team today to get started.
What Can Embedded Finance Do for You?
Embedded finance presents a transformative opportunity for brands to differentiate themselves in a competitive marketplace. By integrating financial services such as branded cards, flexible credentials, and dynamic rewards programs directly into the user experience, you can increase new customer acquisition, enhance customer loyalty, strengthen brand engagement, and facilitate seamless transactions. Utilizing Marqeta's cutting-edge technologies and leveraging data-driven insights, you can create personalized rewards and meaningful interactions that not only meet customer needs but also exceed their evolving expectations.
For deeper insights into how credit behavior is changing and where the commercial opportunity sits, explore Marqeta's 2026 State of Credit Report. Ready to give your customers one card that does it all?
