Banking as a Service

Opportunities, Challenges, and Risks of New Banking Business Models

Jason Mikula

• Publisher: Kogan Page
• Year: 2024
• Print ISBN:
  9781398617889
• Edition: 1
• eBook ISBN:
  9781398617896
• Topic: Economics
• Subtopic: Corporate Finance
• Index: Economics

DISTINGUISHED FAVORITE: NYC Big Book Award 2025 - Technology

This book provides a comprehensive look at banking-as-a-service (Baas), equipping readers with an understanding of the origins, evolution, future and applications of BaaS and the key differences across global markets.

BaaS is a game changer in the financial services sector, radically transforming both how consumers experience financial products and the business models delivering them. Banking as a Service cuts through the hype to provide a measured overview of BaaS, helping readers to demystify a complex evolving field and understand its key opportunities, challenges and risks. It provides a framework for understanding where BaaS came from, how BaaS changes the economics and business models of banking products and services, its impact on key stakeholders, and its key regulatory implications.

Banking as a Service explains how business and operating models work, exploring different models such as interchange, deposit gathering, loan origination-to-distribute, legacy, API-first, own licence, match-making and bank service providers and offers a framework for thinking about whether or not they're sustainable. It explores how BaaS operating and business models compare in different global territories and is supported by real-world examples and cases profiling organizations such as Blue Ridge Bank, Unit, Synapse, Goldman Sachs, Railsr, Starling, Solaris, Cacao Paycard, QNB, OnePipe, Airwallex, Nium and Pomelo. It also explains the differences between BaaS, embedded finance and open banking.

Table of contents

• About the Author
• Foreword by Simon Taylor
• Preface
• Acknowledgements
• 1 What Is “Banking-as-a-Service,” and Where Did It Come From?
• 2 Why Do Fintechs Need Banking-as-a-Service?
• 3 The House that Durbin Built: US Fintechs’ Love Affair with Interchange
• 4 What’s in It for Banks? Primarily, a Low-Cost Source of Deposits
• 5 BaaS Business Models: Loan Origination-to-Distribute
• 6 What Are the Different BaaS Operating Models?
• 7 What Is the Difference Between Banking-as-a-Service and Embedded Finance?
• 8 Banking-as-a-Service Challenges Pose Questions about the Model’s Sustainability
• 9 US Case Studies: Synapse, Blue Ridge Bank, Goldman Sachs
• 10 UK/EU Case Studies: Railsr, Griffin, Solaris
• 11 Latin America Case Studies: Dock, Pomelo
• 12 Asia-Pacific Case Studies: Standard Chartered, Nium, Airwallex
• 13 Africa Case Studies: Ukheshe, Jumo, OnePipe
• 14 Middle East Case Studies: United Payment, QNB, NymCard
• 15 Where Does Banking-as-a-Service Go from Here?
• Abbreviations and Definitions
• Index