Embedded Payments: The Transformative Force Reshaping Industries

The world of payments is undergoing a profound transformation, as the concept of "embedded everything" takes center stage. Payments are becoming inextricably woven into software and platforms, reshaping entire industries and even impacting the digital-only players. This evolution is driving collaboration, simplifying software and selling, and offering enterprises and government entities the ability to accept payments from their own end customers, across diverse sectors from retail to education.

Unlocking the Power of Embedded Payments

Revolutionizing Software-as-a-Service (SaaS)

The SaaS landscape is marked by various business models, each with its own unique characteristics. These SaaS providers are empowering businesses to transform their processes and payments without the burden of complex technical implementation. Moreover, vertical SaaS players are revolutionizing entire markets by seamlessly integrating "easy" payments where they were previously absent, enabling platforms to monetize payments and merchants/businesses to be paid more efficiently.The ripple effect of this embedded payment ecosystem is that everyone, from end-to-end, benefits from more efficient payment processing and flexible financing options. This streamlined approach not only enhances the overall payment experience but also drives greater affordability and accessibility for businesses of all sizes.

Addressing the Affordability Challenge

SaaS sales teams, who cater to enterprise customers, face the challenge of offering cloud-based solutions that help their clients manage a wide range of business functions, from customer relationships to marketing and communication tools. To maintain these valuable relationships, these sales teams must provide affordable options that address the common hesitation over large upfront costs.Lemon, a leading fintech company, has recently announced the launch of its financing platform designed specifically for SaaS sales teams. This platform aims to overcome the obstacle of customer reluctance by allowing buyers to spread the cost over multiple payments. Simultaneously, Lemon enables sellers to receive the full contract value upfront, facilitated by the partnership with Shawbrook Bank.

Monetizing Payments through Embedded Solutions

The embedded payments landscape is also witnessing strategic partnerships and acquisitions that further drive the integration of payment capabilities into software solutions. Cross River Bank, a prominent financial institution, has forged a collaboration with embedded payments company Forward. This partnership is designed to address the payment challenges faced by SaaS providers, including the facilitation of same-day ACH payouts.Similarly, payment-as-a-Service provider UNIPaaS has launched a small-business-focused invoice payments partnership with American Express. This collaboration empowers SMBs to offer their customers the option of paying invoices using American Express cards through the UNIPaaS platform, accelerating business invoice payments.The trend of embedded payments is also evident in the recent acquisition of Lemon Squeezy by Stripe, a leading fintech player. Lemon Squeezy serves as a merchant of record, primarily for SaaS companies, handling global sales tax calculations and management for digital products.

Simplifying the SaaS Sales and Buying Experience

The drive for simplification and streamlining extends beyond just payments. HubSpot, a prominent player in the SaaS ecosystem, has announced the acquisition of Cacheflow, a company that specializes in subscription billing management and configure, price, quote (CPQ) tools. This strategic move aims to simplify the selling and buying of B2B software by automating the SaaS sales flow process within a single, no-code platform.HubSpot's Commerce Hub, which includes invoicing and payments, processed more than $1 billion in GMV last year, further underscoring the growing importance of integrated payment solutions in the SaaS landscape.