The past five years have seen the Banking-as-a-Service (BaaS) space explode. At their core, BaaS providers allow companies - namely fintech and tech companies - to piggyback on their banking or e-money licence to easily offer financial products to their own customers through application programming interfaces.
These products include everything from physical and virtual bank accounts, access to key payment schemes, compliance checks and direct debit to trading platforms and cryptocurrency services. Research suggests that up to 82% of Europe’s fintechs rely on these BaaS providers and many, including the likes of neobank Revolut, have built their business models on them.
