Market Size of US Banking-as-a-Service Industry
| Study Period | 2020 - 2029 |
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2029 |
| Historical Data Period | 2020 - 2022 |
| CAGR | 9.00 % |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Need a report that reflects how COVID-19 has impacted this market and its growth?
US Banking-as-a-Service Market Analysis
The Covid-19 pandemic has resulted in increased adoption of Banking-as-a-Service for non-banking businesses. People have progressively utilized e-commerce platform solutions during the epidemic, resulting in an increase in online payment technologies. Financial institutions have demonstrated a strong interest in banking as a service to improve business processes and deliver secure contactless payments since the Pandemic.
Banking-as-a-Service Market systems have evolved as a key component of open banking, which allows third parties to establish new services using banks' application programming interfaces (APIs), providing account holders with more financial transparency options. This technology is revolutionizing retail banking, redefining incumbents' customer relationships, and making it easier for fintech to enter the market. The need for banking-as-a-service (BaaS) platforms is rapidly increasing in the United States, owing to the country's expanding financial market and expanding insurance industries. Digital banking in the United States has undergone substantial transformation and expansion in recent years, with over 70 digital banking platforms introduced since 2018, fueling the growth of BaaS platforms in the country. The demand for banking-as-a-service (BaaS) platforms in the United States is predicted to grow at a rapid rate over the forecast period. Big data, platform business models, advanced analytics, smartphone technology, and peer-to-peer networks are rapidly driving the US economy. At the same time, financial sector innovation is transforming the market drastically.
Application programming interfaces (APIs) have proven to be a lifesaver for banks, since they have simplified digital transitions and allowed for faster pivots and innovations. FinTechs and other third-party service providers (TPSP) can assist banks provide consumers with a transparent, smooth, and tailored financial service in addition to their conventional banking services by using APIs which will further increase the demand for banking-as-a-service in the future.
