{"id":10480,"date":"2023-01-31T09:19:11","date_gmt":"2023-01-31T09:19:11","guid":{"rendered":"https:\/\/techandbiz.com.ng\/tab-backup\/?p=10480"},"modified":"2023-01-31T09:21:01","modified_gmt":"2023-01-31T09:21:01","slug":"baas-tomorrows-financial-solutions-today-3","status":"publish","type":"post","link":"https:\/\/techandbiz.com.ng\/tab-backup\/2023\/01\/31\/baas-tomorrows-financial-solutions-today-3\/","title":{"rendered":"BaaS: Tomorrow\u2019s financial solutions, today"},"content":{"rendered":"

\u00a0<\/strong><\/p>\n

 <\/p>\n

The world of financial services is changing \u2013 for the better. A multitude of virtual banking and payment options, cardless and accountless services, and now, Banking as a Service (BaaS) are making financial inclusion the norm instead of a privilege, says Anton Coertzen, CCO of leading fintech enablement partner <\/em>Ukheshe<\/em><\/a>.\u00a0<\/em><\/p>\n

 <\/p>\n

BaaS is the latest technology making waves in the financial services world and Gartner<\/a> predicts it will hit mainstream adoption within two years. BaaS is one of four technologies that Gartner says have the potential for high levels of\u00a0transformation in the banking sector\u00a0\u2013 the others being chatbots, public cloud for banking and social messaging payments apps.<\/p>\n

 <\/p>\n

A Deloitte report<\/a> also says BaaS is becoming ubiquitous. \u201cIt\u2019s reconfiguring the banking value chain, opening the door to disintermediation, and enabling new sources of growth,\u201d it notes.<\/p>\n

 <\/p>\n

How does BaaS work?<\/strong><\/p>\n

BaaS came about because the ability to offer banking services such as cards and loans as a non-bank enterprise improves the customer experience and boosts revenue. However, offering banking services requires a banking licence that is difficult to obtain \u2013 it also requires significant capital and compliance with strict regulations.<\/p>\n

 <\/p>\n

BaaS allows licenced banks to integrate their services directly into the products of non-bank businesses. This means any business can offer its customers digital banking services such as mobile bank accounts, debit cards, loans, and payment services, without needing to acquire a banking licence. The non-financial business can also distribute these financial products under its own brand.<\/p>\n

 <\/p>\n

All of this happens through third-party distributors. These distributors build tech that allows digital banks, fintechs, and other third parties to connect directly with a bank\u2019s systems via APIs.<\/p>\n

 <\/p>\n

In a nutshell, it enables embedded finance: banks integrate fintech or other FSP products into the banking journey (BaaS), while non-financial companies embed banking products into their own services (embedded finance).<\/p>\n

 <\/p>\n

The benefits of BaaS<\/strong><\/p>\n

BaaS is reconfiguring the banking value chain by enabling third-party distributors to offer banking products and services. It\u2019s opening the door to disintermediation and enabling new sources of growth for all parties \u2013 whether the bank, the fintech enabler, or the third party.<\/p>\n

 <\/p>\n

Ukheshe offers banks and other financial institutions a cloud-based API-first BaaS platform that can be white-labelled – essentially allowing the bank\u2019s customers to offer embedded finance offerings to their own customers, under their own brand. Examples include wallet as a service, card as a service, KYC as a service, and more.<\/p>\n

 <\/p>\n

Here are just some of the benefits of Eclipse within BaaS:<\/p>\n

 <\/p>\n

For banks:<\/p>\n