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Zilvinas Bareisis, Head of Retail Banking and Payments at Celent, has released a report examining the EMI market in the UK and Europe. The report highlights the systemic importance of EMIs and the challenges they face in finding banking partners that meet their needs. It also emphasizes the interconnectedness and complexity of the fintech ecosystem, where banks, EMIs, and other fintechs are both competitors and partners.
EMIs are struggling to find banking partners: Despite holding estimated deposits of €35 billion across Europe, EMIs often struggle to find a banking partner that meets their needs. Banks provide services such as safeguarding, credit and banking services, and acting as sponsors for account-to-account payment systems.
EMIs are key clients and partners in offering embedded finance: By considering EMIs as key clients and partners in offering embedded finance, partner banks can capture a greater share of the €35 billion in deposits across the UK and EU.
EMIs are looking to add new banking partners: Many EMIs are looking to add new banking partners to provide additional risk mitigation and resilience. Ease of integration and risk appetite alignment are more important than price when selecting a banking partner.
EMIs expect regulation to tighten: EMIs anticipate that regulation will tighten in response to market failures, and they welcome this as a way to increase their reputation and demonstrate compliance with higher standards. Tighter regulation will also increase confidence in EMIs and remove barriers to collaboration with banks.
ClearBank and Celent emphasize the importance of cooperation: ClearBank and Celent believe that cooperation and collaboration are key to better services for consumers and businesses in the fintech sector.
