Banking-as-a-Service Market Thumbnail Image


Banking-as-a-Service Market

Banking-as-a-Service Market Size, Share, Competitive Landscape and Trend Analysis Report by Component, by Type, by End User : Global Opportunity Analysis and Industry Forecast, 2023-2032

BI : Financial Services

Select an option
Author's: Ravi Raj | Onkar Sumant
Publish Date:

Get Sample to Email

Banking-as-a-Service Market Research, 2032

The global banking-as-a-service market was valued at $4 billion in 2022, and is projected to reach $22.6 billion by 2032, growing at a CAGR of 19.3% from 2023 to 2032.

Banking-as-a-service (BaaS) is an end-to-end process that enables banks to execute all financial services through an API or cloud platform. In addition, the banking-as-a-service platform is responsible for managing, deploying, and delivering critical financial services to end users. Furthermore, the banking-as-a-service market is a business model wherein conventional banking services are provided as digital, scalable, and modular products that are easily integrated into non-banking platforms and apps.

Banking-as-a-Service Market Insights

Banking-as-a-service industry spares businesses, including fintech companies, from developing and managing a comprehensive banking infrastructure by enabling them to leverage and access a range of financial services using Application Programming Interfaces (APIs). Moreover, one of the main features of banking-as-a-service industry is the development of software applications using APIs, a set of protocols and tools. APIs allow businesses to access basic banking activities programmatically in the context of BaaS by facilitating the smooth integration of financial services into third-party apps.

Increase in use of digital transformation technology in banks is a significant driver of the growth of the banking-as-a-service market size. Banks can minimize manual processes, save operating expenses, and streamline their operations with the use of digital transformation tools. BaaS reduces the requirement for internal development and maintenance by enabling banks to employ outside providers for particular banking activities, as banks save money as a consequence of strategy. Furthermore, streamlining financial services has driven the demand for the banking-as-a-service market growth.

However, the increase in cyber-attacks has hampered the growth of the banking-as-a-service market outlook as banks and other financial organizations manage private and sensitive data. The security of data and transactions in a BaaS environment is a problem due to the growing frequency and sophistication of cyber-attacks. Banks may be reluctant to implement BaaS solutions if they believe such solutions could provide security risks due to concerns about data breaches, illegal access, and financial fraud. Moreover, high cost of adoption are major factors that hamper the growth of the banking-as-a-service market share.

The report focuses on growth prospects, restraints, and trends of the banking-as-a-service market forecast. The study provides Porter’s five forces analysis to understand the impact of numerous factors, such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers, on the banking-as-a-service market.

Segment Review

The banking-as-a-service market is segmented on the basis of component, type, enterprise size, end user, and region. On the basis of component, the market is divided into platform and service. By type, it is bifurcated into API-based Bank-as-a-service and cloud-based bank-as-a-service. By end user, it is categorized into banks, fintech corporation/NBFC, and others. On the basis of region, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.

Banking-as-a-Service Market by Component

On the basis of component, the platform segment attained the highest market share in 2022 in the banking-as-a-service market. This is attributed to the fact that a variety of banking services are provided by banking-as-a-service (BaaS) service providers, enabling enterprises and financial institutions to contract out non-core banking tasks. Services including account administration, payments, compliance, and risk management are included in this. Businesses are able to concentrate on their core capabilities by outsourcing such functions. Meanwhile, the service segment is projected to be the fastest-growing segment during the forecast period. This is attributed to the fact that the scalability of BaaS platforms, enterprises, and financial institutions modify their banking offerings in response to changing market demands. BaaS solutions are appealing to a variety of companies due to their scalability and flexibility, particularly those that are growing or have fluctuating transaction volumes.

Banking-as-a-Service Market by Region

On the basis of region, Europe attained the highest market share in 2022 and emerged as the leading region in the banking-as-a-service market. This is attributed to the fact that the consumers in Europe have typically been among the first to use financial innovations such as digital banking. BaaS providers can serve both new, digitally native businesses and established financial institutions have grown as a result of this need. On the other hand, Asia-Pacific is projected to be the fastest-growing region in the banking-as-a-service market during the forecast period. This growth is attributed to the fact that a considerable proportion of people in Asia-Pacific primarily use smartphones to access financial services, making them a mobile-first society. Consumer tastes in this region are well aligned with BaaS, which places a strong premium on digital and mobile capabilities.

The report analyzes the profiles of key players operating in the banking-as-a-service market such as Banco Bilbao Vizcaya Argentaria, Block, Inc, Bnkbl Ltd, ClearBank Ltd, Green Dot, MatchMove Pay Pte Ltd, Solaris SE., Starling Bank, Stripe, Inc., and Treasury Prime. These players have adopted various strategies to increase their market penetration and strengthen their position in the banking-as-a-service market.

Competitive Analysis

Recent Partnership in the Banking-as-a-service Market

In November 2023, Zile Money partnered with Sunrise Bank to offer banking-as-a-service. The partnership has the potential to completely transform the fintech industry by delivering unmatched efficiency to real-time monitoring and customer onboarding, all the while maintaining Sunrise Bank's gold standard for risk and compliance. Furthermore, this collaboration offers unprecedented integration prospects, with Zil Money's strong infrastructure, up-and-coming fintechs may now easily provide a full range of financial services, from card issuance to banking and payments, all under Sunrise Bank's strict compliance guidelines.

Recent Partnership in the Banking-as-a-service Market

In October 2022, Treasury Prime partnership with First Internet Bank to offer banking-as-a-service. With this partnership, Treasury Prime will continue to expand its network of 15 financial institutions across the country, which is already the largest in the business. Furthermore, the Tech-forward clients will be able to grow their services and reach a wider audience by utilizing Treasury Prime's state-of-the-art API connections and BaaS capabilities in conjunction with First Internet Bank's strong infrastructure and compliance systems. Treasury Prime presently collaborates with two of the top neobanks in the market: Zeta, which provides a joint account to support modern families, and Challenger, which offers an employer-sponsored savings program to assist employees in saving with every paycheck automatically.

Top Impacting Factors

Increase in use of Digital Transformation Technology in Banks

Digitization is the process of converting data or information into a digital format with the adoption of advanced technology. It plays a critical role in the banking sector, owing to the increasing need among banks to provide enhanced customer services and to improve the security of the customer. Furthermore, banking-as-a-service helps banks to offer digital payment service to their customers and saves time on the debt collection process, thus propelling the growth of the market. In addition, the rise in demand for digital transformation technology in the banking and financial institutions and increase in dependency of various banks on banking-as-a-service solutions drive the growth of the market. In addition, market players across the globe are adopting various advanced technologies such as blockchain technology, big data, and artificial intelligence to increase productivity with minimal resource utilized, which drive the growth of the market. Furthermore, digital transformation encourages online banking to have an innovative culture.

Banks may create and implement new services more quickly by utilizing cutting-edge technologies like microservices, cloud computing, and Application Programming Interfaces (APIs). Through APIs, BaaS providers provide pre-built, modular banking services, saving banks time and money by avoiding the need to develop new features from the ground up. Therefore, the increase in use of digital transformation technology in banks has driven the demand for banking-as-a-service market.

Streamlining Financial Services

The banking-as-a-service platform allows financial service access to third-party organization through API. In addition, the platform helps banks and FinTech to streamline their financial services as well as to improve their services and enhances customer experience, which drives the growth of the market. In addition, it helps financial institutions to offer customer-embedded financial service and improve funding sources to serve their massive customer bases, which fosters the growth of the market across the globe. Moreover, the surge in need among banks to meet customer requirement and to provide high security to customers in critical transactions accelerate the growth of the market. In addition to this, various banks are facing issues in streamlining their money transaction process, owing to which banks are shifting their focus toward banking-as-a-service platform, which notably contributes toward the growth of the global market.

Banking-as-a-service industry allows companies and financial institutions to contract with specialist service providers to handle certain banking tasks. They can attain operational efficiency and concentrate on their main skills by doing this. Compared to internal operations, BaaS suppliers frequently possess the infrastructure and knowledge necessary to manage these tasks more effectively. Therefore, streamlining financial services is driving the demand of the banking-as-a-service market.

Increase in Cyber-attacks

Increase in cyber-attacks in the financial sectors to collect the customer’s information is restricting the growth of the market across the globe. Although the demand for banking-as-a-service is increasing continuously, the rise in the threat of cyber-attacks hampers the growth of the market. In addition, lack of server security, insecure or ineffective data storage, and inadequate authentication & authorization while using banking services are limiting the growth of the market. Furthermore, the increase in the volume of customers financial information in banks and lack of cyber security solutions hinder the growth of the market.

Moreover, financial institutions and end consumers may lose trust as a result of successful cyberattacks. Customers and companies may be reluctant to adopt or use BaaS platforms if they believe they are subject to security breaches. This could have an adverse effect on the market's growth for BaaS. In addition, cyberattacks may cause downtime, operational problems, and monetary losses. Financial institutions can reconsider their dependency on outside providers if security incidents cause service interruptions on BaaS platforms, which could hinder the expansion of the BaaS market. Therefore, increase in cyber-attacks are hampering the growth of the banking-as-a-service market opportunity.

Increase in demand for banking-as-a-service infrastructure to improve the business value

Developing economies offer significant opportunities for banking-as-a-service to expand their business by offering easier access to capital and financial services. In addition, banking-as-a-service helps a business to monitor the financial health of business and carry out advanced financial services for business & customers, within platform without moving outside, which accelerate the adoption of banking-as-a-service platform among the business. Moreover, monitoring all transaction in the business account at single platform, transferring the fund easily & instantly anytime, and streamlining the payouts for business even bulk fund transfers are some of the factors that will boost the growth of the market in the near future.

Furthermore, several leading banking platform providers across Asia-Pacific have integrated API platform in the banking product to streamline the customer’s payment service and to increase the security of transaction process. Moreover, businesses can concentrate on their core skills and strategic goals by utilizing BaaS infrastructure. By contracting with specialized suppliers to handle financial activities, businesses may focus on areas that directly add to their value and allocate resources more effectively. Therefore, the increase in demand for banking-as-a-service infrastructure to improve business value is a lucrative opportunity for the banking-as-a-service market.

Key Benefits for Stakeholders

  • This report provides a quantitative analysis of the market segments, current trends, estimations, and dynamics of the banking-as-a-service market analysis from 2022 to 2032 to identify the prevailing banking-as-a-service market opportunities.
  • Market research is offered along with information related to key drivers, restraints, and opportunities.
  • Porter's five forces analysis highlights the potency of buyers and suppliers to enable stakeholders to make profit-oriented business decisions and strengthen their supplier-buyer network.
  • In-depth analysis of the banking-as-a-service market segmentation assists to determine the prevailing market opportunities.
  • Major countries in each region are mapped according to their revenue contribution to the global market.
  • Market player positioning facilitates benchmarking and provides a clear understanding of the present position of the market players.
  • The report includes the analysis of the regional as well as global banking-as-a-service market trends, key players, market segments, application areas, and market growth strategies.

Banking-as-a-Service Market Report Highlights

Aspects Details
Market Size By 2032

USD 22.6 billion

Growth Rate

CAGR of 19.3%

Forecast period

2022 - 2032

Report Pages


By Component
  • Platform
  • Service
By Type
  • API-based Bank-as-a-service
  • Cloud-based Bank-as-a-service
By End User
  • Banks
  • FinTech Corporations/NBFC
  • Others
By Region
  • North America  (U.S., Canada)
  • Europe  (UK, Germany, France, Italy, Spain, Rest of Europe)
  • Asia-Pacific  (China, Japan, India, Australia, South Korea, Rest of Asia-Pacific)
  • LAMEA  (Latin America, Middle East, Africa)
Key Market Players

Stripe, Inc., Block, Inc., Treasury Prime, Bnkbl Ltd, Banco Bilbao Vizcaya Argentaria, S.A., Green Dot Corporation, Starling Bank, MatchMove Pay Pte Ltd, Solaris SE, ClearBank Ltd

Analyst Review

The adoption of banking-as-a-service (Baas) platform has increased over the years, owing to surge in adoption of digital banking solutions among end users due to rising adoption of smart phones and ease of transactions as compared to traditional banks. In addition, banking-as-a-service protects the confidentiality of digital data stored on mobile devices or transmitted over the internet, which is increasing its popularity among end users. Furthermore, technological advancements and an increase in awareness among consumers can lead to rapid growth during the forecast period. It offers individuals an end-to-end approach to facilitate FinTech companies and other third-party organizations. It provides advantages to start-ups and SMEs to leverage effective and smooth business banking solution. Moreover, financial institutions have become more distinctive and competitive in the market by using BaaS that helps them innovate and create new financial products and services that are focused on the needs of the client. Furthermore, banking institutions take advantage of BaaS to reach new customer and geographical areas while expanding their services internationally without having to establish a physical presence in every market. In addition, through the use of BaaS, traditional banks and fintech startups work together to co-create creative solutions that combine the advantages of both rapid fintech businesses and well-established institutions. Moreover, banking-as-a-service enables financial institutions to fulfill the rising expectations of digitally savvy consumers by providing seamless, personalized, and technologically sophisticated financial services, hence improving the customer experience.

Furthermore, market players have adopted various strategies for enhancing their services in the market and improving customer satisfaction. For instance, in July 2021, Square Inc. introduced banking services for small businesses, and offer saving and checking account service. The company's market share is expected to grow, and the banking-as-a-service product is anticipated to improve customer experience. Furthermore, Square Banking is the first step in the company's plan to offer more banking options to small businesses and is a significant turning point in Square's ongoing efforts to increase the underbanked populations' access to financial instruments. Moreover, in July 2023, Bankable, a pioneer in the banking-as-a-service industry, acquired Arex Markets. Investors fund a range of commercial papers to easily accelerate payment flows and lessen the working cash burden due to Arex Markets' patented technology. Furthermore, the B2B finance sector is still having difficulty finding rapid and flexible ways to access liquidity solutions, and investors are still looking for the ideal ratio of yield to risk as BaaS and embedded finance solutions that continue to proliferate. These strategies by the market players operating at a global and regional level are expected to help the market to grow significantly during the forecast period.

Some of the key players profiled in the report include Banco Bilbao Vizcaya Argentaria, Block Inc, Bnkbl Ltd, ClearBank Ltd, Green Dot, MatchMove Pay Pte Ltd, Solaris SE., Starling Bank, Stripe, Inc., and Treasury Prime. These players have adopted various strategies to increase their market penetration and strengthen their position in banking-as-a-service.









Author Name(s) : Ravi Raj | Onkar Sumant
Frequently Asked Questions?

One major trend in Banking-as-a-Service (BaaS) is the increasing emphasis on embedded finance. As financial services become seamlessly integrated into non-financial platforms, businesses from various industries can offer banking and payment services directly to their customers. This trend is driven by the growing demand for more convenient and personalized financial experiences.

API-based Bank-as-a-service is the leading application of Banking-as-a-Service Market

Europe is the largest regional market for Banking-as-a-Service

22575.76 million is the estimated industry size of Banking-as-a-Service

Banco Bilbao Vizcaya Argentaria, Block, Inc, Bnkbl Ltd, ClearBank Ltd, Green Dot, MatchMove Pay Pte Ltd, Solaris SE., Starling Bank, Stripe, Inc., and Treasury Prime. are the top companies to hold the market share in Banking-as-a-Service

Loading Table Of Content...

Loading Research Methodology...

Individual sections of the reports are available for purchase.
Would you like to see a breakdown of prices by section?

Banking-as-a-Service Market

Global Opportunity Analysis and Industry Forecast, 2023-2032