Banks miss out on the growth of embedded finance
Non-bank lenders are offering growing volumes of embedded finance both wholesale to merchants selling on e-commerce marketplaces and to their retail customers.
On January 26, Santander announced the launch of Zinia, a new 'buy now, pay later' (BNPL) platform offering interest-free instalment loans to consumers buying both online and at physical points of sale.
The technology behind Zinia has been operating in Germany for the past year, and Santander says it has already acquired more than two million customers there, making it one of the leading bank players in BNPL in Europe by customer volumes.
It is a sign that a few banks are now fighting back to recapture ground conceded to specialist providers of embedded finance, a growth area in wholesale and retail lending.
Ezequiel Szafir, chief executive of Openbank and Santander consumer finance, says: “We are delighted with Zinia’s early expansion and aim to become a leader in the buy now, pay later market.”
There’s little wonder why. BNPL has enjoyed enormous success as online retail activity has grown. In June, Klarna, the leading European provider of such unsecured instalment loans to consumers, achieved a $46.5 billion valuation through a $639 million funding round led by SoftBank Vision Fund.