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How Embedded Finance Can Grow Substantially with Gens Y and Z


July 11, 2022

The ascent of millennials and Gen Zers to corporate decision-making roles is going to have a major effect on nearly all aspects of the business sector because these digital-native generations are different in so many key ways compared to older generations.
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The following was adapted from the Embedded Finance Tracker, produced by Galileo in cooperation with PYMNTS.

Gen Y and Gen Z have never known a world without the internet, having grown up with access to smartphones and other tools creating smooth, convenient digital experiences. As a result, millennials and Gen Zers do not have the resistance to fast and evolving digital payment solutions that members of prior demographics have had, or their adherence to traditional banking and financing models. Instead, they are early-adopters, highly comfortable with technology, and prefer digital solutions that they can use whenever and wherever they need them.

In the below interview, Galileo Financial Technologies Chief Product Officer Archie Puri offers insights into how B2B embedded finance will grow exponentially with Gen Y and Gen Z as members of these generations ascend to corporate decision-making roles, and how this movement presents a major market opportunity for providers who can deliver value in the B2B embedded payments space.

As millennials and Gen Zers take on a greater share of managerial and corporate decision-making roles, how do you expect those generations to influence the B2B digital payment space in the near future?

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The ascent of millennials and Gen Zers to corporate decision-making roles is going to have a major effect on nearly all aspects of the business sector because these digital-native generations are different in so many key ways compared to older generations. Within this context, how B2B financial services are delivered is going to be among the areas wherein this tectonic shift is most apparent. Members of these generations have grown up with access to the internet, smartphones and other tools that have removed a huge amount of the friction that traditionally surrounded payments and financial services. So there’s a deeply ingrained expectation in members of those age demographics for a fully digital, fast, convenient and smooth payments experience — and one that’s personalized for them, based on their own past behavior and preferences. They also want to be able to run their business from anywhere, which means they need financial services that are not tied to a physical branch or location. As millennials and Gen Zers have entered the workforce, they’ve brought those same expectations with them into the B2B arena. This movement will continue to accelerate as they take on more decision-making positions, whether in the form of senior roles within enterprises and larger companies or as owners of their own small businesses. As today’s millennial and Gen Z sensibilities become tomorrow’s business priorities, the onus will be on financial services providers serving the B2B space to fulfill those demands, leading to better products that take a human-centric approach.

How are millennial and Gen Z consumers’ embedded finance experiences, in particular, impacting B2B payment innovation?


Amid the increased pressure on providers to meet millennial and Gen Z demands in the B2B payments space, the good news is that these generations possess a high level of familiarity and comfort with technology. This means they’re more likely to be early adopters of new payment tools — and even entirely new payment models — that can fulfill their needs and wants, no matter where, when and how those interactions occur. Embedded payments are a great example of that willingness to break free of traditional models. Services like Uber, Venmo and the Starbucks mobile app all were able to gain major traction with younger consumers — and that was largely because those consumers don’t have years of ingrained habits about how payments ‘should’ work. They just recognized the value this embedded model could offer them, and they responded. That openness to thinking about different ways finance and payments can fit into the ecosystem of various other services represents a major opportunity for providers who can deliver that value in the B2B space. We’re seeing that now with services like business lending integrated directly into point-of-sale systems — and as millennials and Gen Zers become a larger part of the workforce and exert greater influence in the business sector, this opportunity is only going to become larger.

Amid the rise of fully digital payment experiences in the B2B space, what role should banks play to best support such solutions?

Just as it does in the B2C space, embedded finance offers a great opportunity for traditional banks to overcome some of the core tech-based challenges they face in addressing modern B2B needs. Many banks are still running on older core systems that worked really well for a more top-down approach to developing products and services that were based around those legacy systems. But those frameworks weren’t necessarily built to support the use cases and demands of millennials and Gen Zers in the B2B space, where addressing the needs of the end user first is becoming more important. The good news is that there is absolutely a place for established banks in embedded finance frameworks.

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