Banking as a Service (BaaS) has emerged as a transformative solution, reshaping how banking and financial services are delivered and consumed. BaaS providers enable businesses, from startups to established enterprises, to seamlessly integrate banking and financial services into their applications without becoming licensed banks.
If you’re interested in financial technology advancements, stay with us. This article provides a closer look at BaaS and an overview of the top 10 Banking as a Service providers in the market.
What is Banking as a Service?
Banking as a Service (BaaS) is a model that allows organisations to leverage the infrastructure and capabilities of financial institutions, such as banks or licensed fintech companies, to offer banking and financial services to customers.
BaaS enables businesses to focus on their core offerings while tapping into a wide range of financial features, including payments, account management, lending, and more, all through APIs (Application Programming Interfaces).
In the traditional banking setup, obtaining a banking licence and developing the necessary infrastructure can be daunting and time-consuming. BaaS disrupts this norm by providing businesses with access to the tools, compliance frameworks, and expertise of established financial service providers, opening doors for innovation, agility, and improved customer experiences.
What services do BaaS providers offer?
Banking as a Service companies offer a wide range of services businesses can seamlessly integrate into their products. Here are some of the key services that BaaS providers commonly offer:
Payment processing
BaaS providers enable businesses to facilitate transactions, process payments, and manage funds. This includes accepting card payments, initiating transfers, and handling digital wallets. Integrating payment services can transform a business’s ability to offer a seamless checkout experience and optimise financial operations.
Account management
Through BaaS, businesses can offer their users personalised and secure accounts supporting balance inquiries, transaction histories, and fund transfers.
Lending and credit services
BaaS companies may offer lending solutions, allowing businesses to provide credit or loans to their customers. This can include credit assessments, loan origination, and repayment management.
Compliance and regulatory support
Financial services are subject to strict regulations. BaaS providers typically offer compliance and regulatory tools to help businesses navigate these complexities. This includes identity verification, anti-money laundering (AML) checks, and Know Your Customer (KYC) processes.
Fraud prevention and security
Security is paramount in the financial world. BaaS providers often integrate fraud detection and prevention mechanisms to safeguard transactions and user data. These features can help businesses build customer loyalty and trust, effectively protecting their users.
International payments
For businesses with global reach, BaaS providers offer international payment capabilities. This enables seamless cross-border transactions and currency conversions, making it easier for businesses to provide services across different regions.
Reporting and analytics
BaaS providers often include reporting and analytics tools that help businesses gain insights into financial activities, user behaviours, and transaction patterns. These insights can inform strategic decisions and optimisations.
Top 10 Banking as a Service providers & platforms
BaaS providers empower businesses to offer customers the best banking experiences within their products and platforms. Let’s take a closer look at the best BaaS providers that are reshaping the future of financial services.
1. Solaris Bank
The Germany-based Solaris Bank is Europe’s largest BaaS platform provider, delivering digital banking services, branded debit and credit cards, KYC, etc.
Solaris is known for revolutionising the digital finance landscape by removing barriers for businesses. Their BaaS platform lets organisations seamlessly integrate cutting-edge financial solutions into their operations. American Express, Samsung Pay, Vivid Money, and Tomorrow are among the company’s customers.
2. Bankable
Bankable is a UK-based BaaS provider that serves financial institutions, corporates, and fintech entrepreneurs to deliver highly differentiated payment solutions. According to Bankable, they ensure significant net revenues and cost savings by making the most of their fast, scalable, and secure API and white-label platform that enables targeted solutions.
Their interoperable proprietary platform is PCI-DSS certified and hosted in Tier-4 data centres. Their services include a virtual ledger manager (cash management and reconciliation), digital banking (IBAN accounts, payment cards, payments through SEPA and SWIFT), eWallets, and payment card API (a branded consumer card program conforming to PCI-DSS).
3. Treezor
Treezor is a French Banking as a Service provider that integrates technology, regulatory compliance, and robust security into its service offerings, providing API-powered access to the whole payment chain. Treezor is EMI-authorised to operate across the EU. In addition, the company is a principal member of the Mastercard network.
4. Railsr
The UK-based Railsr (formerly Railsbank) offers a state-of-the-art Banking-as-a-Service platform that allows businesses to seamlessly embed advanced features into their financial product offerings. Their BaaS API suite includes payments, Open Banking, international transfers, digital wallets, regulatory compliance, etc. While these features work best for fintech and retail, the team at Railsr says their solution fits any industry.
5. Starling Bank
Starling Bank is a challenger bank providing current and business bank accounts in the UK. As a Banking as a Service provider, Starling Bank gives its users access to a broad array of features and services, including online cheque deposits and a marketplace connecting with third-party service providers such as pensions, insurance, and mortgages. Moneybox, Raisin, CurrencyCloud, and Vitesse are among Starling’s clients.
6. Stripe
According to Stripe, their services are the easiest way for platforms to build and launch feature-rich, scalable embedded finance solutions that allow businesses to embed financial services into their existing software.
Stripe offers a payments solution (multiparty payments, collecting payments from customers, paying out third-party providers), business financing (a complete lending program through a single integration), business card (branded virtual and physical cards with your branding), and bank account replacement (eligible accounts for earning yield, sending ACH or domestic wire transfers, and KYC).
Shopify, Lightspeed, and Housecall Pro partner with Stripe to enhance their services and generate additional revenue streams for their businesses.
7. 11:FS Foundry
11:FS is a challenger consulting firm focused on fintech. A couple of years ago, they introduced a Banking-as-a-Service platform called Foundry. DNB, Norway’s largest financial services firm, was the first customer.
Foundry is a modular set of components that allows you to build digitally native propositions to scale and at speed. As a user, you can use a proposition entirely on Foundry or mix and match various components to create the ideal fintech product to cater to your customer needs.
8. Cambr
Cambr’s Deposit Platform connects its clients with over 850 banks to improve cash storage and increase returns. Their solution lets users securely monetise deposits at scale with an easy integration taking a matter of weeks.
Cambr’s customers are embedded finance and fintech companies that make the most of their Banking as a Service solution to scale to millions of users. According to Cambr, direct relationships with banks and experience developing innovative fintech products make them an industry leader.
9. ClearBank
The UK-based ClearBank is one of the banking industry leaders offering innovative banking services for integration. ClearBank focuses on security and compliance, catering to payments, fintech, digital banking, and eCommerce businesses. According to ClearBank, the company was built on the belief that banking infrastructure shouldn’t slow down progress but instead be the catalyst that unlocks the potential to innovate.
10. Intergiro
Intergiro is a Swedish financial service provider offering APIs that provide the infrastructure for neobanks, payment service providers, crowdfunding platforms, crypto exchanges, etc. As a BaaS provider, Intergiro enables businesses to launch and control financial services through API or embed additional services into their existing products.
Intergiro use cases include modern virtual card issuing products, in-app payment methods, setting up traditional card programmes, and embedding multi-currency IBAN accounts, to name a few.
Tips on how to choose a BaaS provider
Selecting the right Banking as a Service provider is an important decision that can impact your business success and the quality of financial services you offer to your customers. With numerous providers in the market, it’s essential to consider several factors before making your choice. Here are some tips to guide you through the process of selecting the ideal BaaS provider for your business:
Define your needs
First of all, you should clearly define the financial services you need to integrate into your product or platform. Consider specific functionalities, e. g., payment processing, lending, or compliance features, that are essential for your business model.
Look for scalability and flexibility
Choose a BaaS provider that can accommodate your business’s growth. Ensure that the provider’s financial infrastructure is scalable and can handle increased transaction volumes as your user base expands. In addition, look for flexibility in services offered – it will let you add or modify functionalities as your business evolves.
Seek security and compliance
Ensure that the BaaS provider of your choice follows robust security practices, including encryption, tokenisation, and regular security audits. Additionally, inquire about their compliance with industry regulations and data protection standards relevant to your market.
User experience matters
Your customers’ interactions with your financial services should be seamless and intuitive, so remember to evaluate the provider’s user interface, mobile responsiveness, and overall design to ensure a positive user experience.
Don’t overlook branding
Choose a BaaS provider that allows you to customise the user interface to align with your brand’s identity – incorporating your branding elements can enhance user trust and recognition.
Go for better customer service
Strong customer support is essential, especially when dealing with financial services. Ask about the provider’s support channels, response times, and availability. A responsive service provider can help address issues promptly and minimise disruptions, which is crucial in today’s fast-paced business environment.
Final words
It’s safe to say that BaaS providers don’t just offer financial services – they facilitate innovation, streamline business processes, and unlock new opportunities for businesses to thrive in a competitive landscape.
BaaS allows businesses to focus on their core business competencies while using the infrastructure of providers to enhance user experience and value proposition. If you have chosen to implement BaaS as part of your digital transformation, make sure the provider of your choice aligns with your goals, offers efficient customer service, and provides a scalable, flexible, customisable, and secure solution.
