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Banking As-A-Service (BaaS) Market Research Report - Size, Share, Growth, Trends, COVID-19 Impact Analysis - Industry Forecast (2022 to 2027)

Banking As-A-Service (BaaS) Market Size (2022-2027)

The Banking-As-A-Service (BaaS) market at the global level is estimated to grow from USD 2.44 billion in 2022 and is expected to reach USD 11.43 billion by 2027 recording a CAGR of 17.5% CAGR during the forecasted period.

Banking-as-a-Service is revamping the financial services area by opening banks to the marketplace. Banking-as-a-service is an end-to-end process that allows banks to implement all financial services through a cloud or an API platform. Furthermore, BaaS is precisely reliable for managing, employing, and delivery of critical financial services to end-users. 

Baas aids in diminishing the time to build and ship apps and also accumulate their products. BaaS is an end-to-end model enabling digital banks and other third parties to link with bank systems through API. 

To change the economic shape, BaaS has decided to bring finance and digital technology platforms.

MARKET DRIVERS
Banks and financial services are increasingly deploying digital transformation which accumulates the growth of banking-as-a-service market development. 

BaaS provides opportunities for continuous development in digital banking and pushes accepted banks into development. The awareness about internet banking is propelling the BaaS market development. Customers are more using internet services to accept various services like cash transfers, balance checks, account statements, online purchases, and 24-hour banking.

MARKET RESTRAINTS
However, the increase in the cyberattack on personal banking information hinders market growth.

Market Segmentation

Banking As-A-Service (BaaS) Market - By Component:

  • Platform
  • Service 
  • Professional Service
  • Managed Service

The services component segment is garnering the BaaS market with the largest share.

Banking As-A-Service (BaaS) Market - By Type:

  • API-based Bank-as-a-service

  • Cloud-based Bank-as-a-service

The API-based bank-as-a-service segment led the market with the largest share. 

Banking As-A-Service (BaaS) Market - By Enterprise Size:

  • Large Enterprise
  • Small & Medium Enterprise 

The large enterprises segment dominates the banking-as-a-service market accounting for more than 60% share. The segment sustains its dominance throughout the period. With the occurring trend of digitalization for adopting more developed and sophisticated service platforms by large multinational banks and fintech globally. 
Furthermore, significant in organizations for effective service platforms and automation capabilities is elevating driving the BaaS market stronger throughout the large enterprise segment.

Banking As-A-Service (BaaS) Market - By End-User:

  • Banks
  • FinTech Corporations/NBFC
  • Others 

The bank end-user commands over the BaaS market during the foreseen period. 

The fintech corporations segment contributes a major revenue share with 26.5% in 2022. With swift digitization, the fintech market has bloomed. People across the fintech sector can now witness a new opportunity for BaaS to grow among embedded finance, whereas non-fintech companies add credit or debit, loans, or other financial services to their products.

Banking As-A-Service (BaaS) Market - By Region:

  • North America
  • Europe
  • Asia Pacific
  • RoW (Rest of the World)

Based on the regions, the banking-as-a-service is led by Europe in 2022. The region is expected to maintain its dominance throughout the historical period. The region's growth owes to the progression of Fintech infrastructure and public and private banks investing heavily. 

The U.K accounts for more than 29% of the share in the banking-as-a-service market. The U.K is the largest market for BaaSplatform owing to the hard existence of BaaSplatform providers. The use of mobile applications is increasing for various services like banking transactions and accepting improved technologies like APIs providing them a developed online presence throughout various channels and banks. 

The region focuses more on customer experience management by offering new services and products to sustain their expectations and serve as a major driver of the market growth. 

North America is likely to have admirable growth in the banking-as-a-service market. The presence of certain market players like Greendot Corporation (US), PayPal (US), Moven and Square Inc. (US), and the rising utilization of new services like peer-to-peer, online money transfers, and mobile payments provide customers with a developed banking experience fuel the market service. 

The U.S and Canada contribute major growth to the banking-as-a-service market. The growth ascribes to various developing economies impact the BaaS market positively with rising advancements in the fund transaction services throughout the U.S. In the U.S., the demand for BaaS is expected to hike the rising financial market, and insurance sectors are growing across the country. In addition, digital banking has eye-witnessed considerable growth and a level of transformation by introducing more than 70 digital banking platforms. The launch of new platforms fuels the market growth. 

Asia-Pacific - The sales of the banking-as-a-service market in India are scheduled to surge at a splendid rate. The market registers a CAGR of more than 26% from 2022 to 2027. 

Latin America and the Middle East and African regions are anticipated to have notable growth in the banking-as-a-service market. Adopting fintech technologies across the developing economies of the regions accumulates market growth. 

Top key players in the market
1. Solarisbank AG

2. Bnkbl Ltd

3. Treezor

4. 11: FS Foundry

5. Green Dot Bank

6. Fidor Bank AG

7. Moven Enterprise

8. Square, Inc
 
COVID-19 Impact On Banking As-A-Service (BaaS)

The SARS-CoV-2 reagent is responsible for the novel infectious disease coronavirus (COVID-19). The World Health Organization (WHO) has announced a public emergency health issue. The pandemic crisis has affected the global economy in every aspect. Almost every business is adversely affected due to the quick emergence of hazardous viruses. With strict lockdown norms and maintenance of social distancing, firms are transferring towards digitalization to assure overall staff and employees. The latest pandemic is said to spike a sweep and systematic modeling of high-impact digital journeys across the banking sector like customer onboarding and product origination. Moreover, due to the COVID-19 eruption, work-from-home scenarios have been spurring and are producing a robust demand for banking-as-a-service (BaaS) platforms globally. 
While the COVID-19 pandemic has impacted traditional banking dramatically, digital banking is expected to achieve quick acceptance. The COVID-19 pandemic has been a core turning point for upgraded change due to budget foundations that are put financially and consciously into digitalization. Quick perforation of work from home and increasing dependency on digital payments with online banking encourage market players for executing blockchain and AI technology for supplying protected services to customers and aid in magnifying the BaaS sales.
 

Recent Market Developments

  • On July 26, 2022, Solarisbank purchased Contis raising USD 224 million at a USD 1.66billion valuation enlarging API-based embedded banking technology in Europe.
  • On October 18, 2022, Treezor launched a new banking-as-a-service solution called 'TreezorBankHub' and has launched in Germany.
  • On March 16, 2022, Green Dot collaborated with Plaid for its neobank, which also has Banking-as-a-Service potential. With the succession, Green Dot expanded its Plaid partnership to its banking as a service (BaaS) firm.
  • On November 29, 2018, Moven partnered with a Russian e-wallet provider. The partnership provides a turnkey, smart-banking platform to banks.

Chapter 1. Global Banking As-A-Service (BaaS) Market – Scope & Methodology

1.1. Market Segmentation

1.2. Assumptionsa

1.3. Research Methodology

1.4. Primary Sources

1.5. Secondary Sources

Chapter 2. Global Banking As-A-Service (BaaS) Market – Executive Summary

2.1. Market Size & Forecast – (2021 – 2027) ($M/$Bn)

2.2. Key Trends & Insights

2.3. COVID-19 Impact Analysis

       2.3.1. Impact during 2022 - 2027

       2.3.2. Impact on Supply – Demand

Chapter 3. Global Banking As-A-Service (BaaS) Market – Competition Scenario

3.1. Market Share Analysis

3.2. Product Benchmarking

3.3. Competitive Strategy & Development Scenario

3.4. Competitive Pricing Analysis

3.5. Supplier - Distributor Analysis

Chapter 4. Global Banking As-A-Service (BaaS) Market Entry Scenario

4.1. Case Studies – Start-up/Thriving Companies

4.2. Regulatory Scenario - By Region

4.3 Customer Analysis

4.4. Porters Five Force Model

       4.4.1. Bargaining Power of Suppliers

       4.4.2. Bargaining Powers of Customers

       4.4.3. Threat of New Entrants

       4.4.4. Rivalry among Existing Players

       4.4.5. Threat of Substitutes

Chapter 5. Global Banking As-A-Service (BaaS) Market - Landscape

5.1. Value Chain Analysis – Key Stakeholders Impact Analysis

5.2. Market Drivers

5.3. Market Restraints/Challenges

5.4. Market Opportunities

Chapter 6. Global Banking As-A-Service (BaaS) Market – By Component

6.1. Platform

6.2. Service

6.3. Professional Service

6.4. Managed Service

Chapter 7. Global Banking As-A-Service (BaaS) Market – By Type

7.1. API-based Bank-as-a-service

7.2. Cloud-based Bank-as-a-service

Chapter 8. Global Banking As-A-Service (BaaS) Market – By Enterprise Size

8.1. Large Enterprise

8.2.  Small & Medium Enterprise

Chapter 9. Global Banking As-A-Service (BaaS) Market – By End-User

9.1. Banks

9.2. FinTech Corporations/NBFC

9.3. Others

Chapter 10. Global Banking As-A-Service (BaaS) Market, By Geography - Market Size, Forecast, Trends & Insights

10.1. North America

       10.1.1. U.S.A

       10.1.2. Canada

       10.1.3. Mexico

10.2. Europe

       10.2.1. Italy

       10.2.2. Spain

       10.2.3. Russia

       10.2.4. Germany

       10.2.5. UK

       10.2.6. France

       10.2.7. Rest of Europe

10.3. Asia Pacific

       10.3.1. Japan

       10.3.2. South Korea

       10.3.3. China

       10.3.4. India

       10.3.5. Australia & New Zealand

       10.3.6. Rest of Asia-Pacific

10.4. Rest of the World

       10.4.1. Middle East

       10.4.2. Africa

       10.4.3. South America

Chapter 11. Global Banking As-A-Service (BaaS) Market – Company Profiles – (Overview, Product Portfolio, Financials, Developments)

11.1. Company 1

11.2. Company 2

11.3. Company 3

11.4. Company 4

11.5 Company 5

11.6. Company 6

11.7. Company 7

11.8. Company 8

11.9. Company 9

11.10. Company 10

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