- Key Insight: Huntington has added embedded banking and payments tech to streamline business functions and payments.
- Expert quote: "Open banking and payments is indeed picking up among banks, especially because it is perceived as a revenue-generating and client-facing investment," —Enrico Camerinelli, strategic advisor at Datos Insights
- What's at stake: Fintechs are also providing similar services, providing competition for banks.
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"The bigger mission is for banks to be not just about lending and deposits, but overall providers for businesses," Deepak Kapoor, head of payment product at Huntington Bank, told American Banker.
Huntington recently added embedded payments and finance technology for business clients, using application programming interfaces to enable business clients to integrate ACH, Apple Pay, Google Pay and other payment options into inventory, supply chains and other back-office functions.
Embedded banking uses permissioned data sharing, or "open banking," to bring banking closer to consumer functions such as shopping and buying from e-commerce apps — or business activities. Embedded payments, which is often grouped with open banking, is similar — allowing people to use their payment account directly within another service.
The concept is drawing lots of investors. The embedded banking market is expected to expand from $39 billion to $161 billion between 2025 and 2030, according to
"Open banking and payments is indeed picking up among banks, especially because it is perceived as a revenue-generating and client-facing investment," Enrico Camerinelli, strategic advisor at Datos Insights, told American Banker. "With embedded banking, banks become infrastructures inside other platforms and open new distribution channels, deepen relationships, and create sticky revenue streams."
Addressing the threat
Fintechs have used embedded payments and finance to lure customers away from banks, but Huntington contends banks have the ability to use emerging technology to retain their market share.
"We won't cede any ground," Amit Dhingra, chief enterprise payments officer, told American Banker. "There's a tremendous opportunity in embedding banking with payments."
Huntington used technology from Payabli, a payment technology seller that contends banks are facing pressure from neobanks and fintechs such as Ramp and Brex.
"These companies are winning business customers not because they're better banks, but because they're wrapping financial services inside really compelling software experiences," Payabli's public relations office said in an email to American Banker. "So for banks, the threat isn't just another bank down the street anymore. It's a tech company that happens to offer banking."
Initially viewed as a threat, more banks are adopting open banking. For example,
For Hungtington, the popularity of e-commerce shopping and payments among consumers is transferable to businesses payments.
"There's been a shift over the past few years in consumer behavior and expectations around digital service," Dhingra said. "And businesses are going to want that."
What banks can do
Thanks to open banking frameworks and standardized APIs that have lowered the integration cost and time-to-market for embedding financial products, what once required a multiyear build can now be launched in months, according to Camerinelli.
"Corporate users are ready to exchange the access to their data for a technology that avoids the need to navigate across separate banking portals," Camerinelli said. "The market is maturing beyond just consumer-facing payments and BNPL. We're seeing rapid expansion into B2B use cases such as invoice financing, working capital lines, embedded lending within accounting software and procurement platforms. This represents a massive, still-underserved opportunity, particularly for community and regional banks looking for growth."
Embedded finance has evolved from an experimental layer of innovation into core financial infrastructure, and that shift has directly impacted how banks need to approach it, according to Remy Carole, chief operating officer at financial software firm Treasury Prime.
"Success today is less about how many programs you launch and more about how reliably you can operate them at scale," Carole told American Banker.
"That means banks need a clear strategy for how embedded finance fits into their broader operating model," Carole said. "They should be thinking about embedded finance as an end-to-end operating model, not just a set of integrations."
One of the biggest challenges to enabling embedded banking is the complexity that quietly builds up over time, according to Carole.
"As embedded programs grow, it's common to see multiple payment rails, different integration methods, and manual processes layered in to handle things like reconciliation or exception management," Carole said. "A lot of those workflows start as quick fixes, like sending a file over email or resolving an issue offline, but over time, they become part of the permanent operating model."
Another challenge is balancing speed with oversight, according to Carole.
"Banks need to support fintech partners quickly, but they also need clear visibility and control over program activity," he said. "Historically, that balance has often depended on manual coordination, which isn't as easy to scale when programs become larger and more complex."
Every part of the lifecycle has to be designed to work at scale, including onboarding fintech partners, managing payments, monitoring activity, handling reconciliation, and maintaining strong compliance oversight, he said.
"Without that level of strategic planning, complexity builds quickly," Carole said. "What starts as a handful of integrations or custom workflows can turn into a patchwork of systems that are difficult to supervise and even harder to scale. To succeed in this next phase, banks must see embedded finance as infrastructure that requires durability, clear operational controls, and a model designed for long-term growth."
