Banking-As-A-Service: Everything You Need To Know

Banking-as-a-Service (BaaS) is a business model that allows Non-Financial Companies to provide services typically associated with a bank or financial institution.

Non-Financial Companies can provide financial services to their customers through BaaS without the need for their own banking licence. This is a game-changer, as it allows almost any type of business to offer the same or similar services that a bank would, without the hassle of obtaining a banking licence. BaaS has quickly become a thriving market, data suggests that the global BaaS market could be worth as much as $3.6 trillion by 2030.

How does Banking-as-a-Service Work?

​​A Non-Financial Company that wants to offer digital banking services can do so by utilising BaaS to integrate those services. This removes the need for Non-Financial Companies to develop and deploy the services on its own. This removes technical development and deployment barriers while working in tandem with regulatory mobilisation implemented by governance. By utilising BaaS, almost any service provider can offer digital banking services to its customers, including:

• Card issuing
• Card acquiring
• A routable account
• Various other embedded financial solutions

“Simply put, the BaaS model enables businesses to rapidly launch and scale their own financial and banking services,” says Traderoot CEO, Jan Ludik.

The Benefits of Banking-as-a-Service

• Low cost: Non-Financial Companies can leverage BaaS to scale quickly in a cost-efficient manner. There’s no need for banking licences and hefty software development fees.
• Expand your service offering: With BaaS, almost any business can expand their service offering to include financial services. You will have more room to expand your customer offering with improved banking and finance functionality.
• Stand out from your competitors: Through the successful implementation of BaaS, your business can stand out from your competitors.

Banking-as-a-Service Solution

Having a company that is positioned to roll out a BaaS franchise structured on multiple regional partnerships with tailored investment, local business operations, bank licences and integration into regional and global payment networks, will benefit and enable anyone – whether a challenger or an established incumbent – to quickly and easily deploy a banking solution through BaaS solution.

Based on cloud native platforms, experience in alliance banking, global application depth and modular technology, a FinTech will need to offer customised and tailored solutions for the regions and relevant compliance and governance.

The BaaS platform has well defined APIs that offer comprehensive SOV & banking, payments, reconciliation & billing, SOV & banking solutions to a variety of new fintech entrants (challenging the ones indicated) and legacy banks to compete and interact in the local market across the globe.