Compliance Becomes the New Competitive Edge in Embedded Finance

“Retailers Expand Embedded Finance to Unlock Control and Customization,” a collaboration between PYMNTS Intelligence and Marqeta, explores how retailers are transforming payments from a back-end function into a front-line growth strategy. The study finds that embedded finance has become a core competitive lever for modern retail. From co-branded cards and digital wallets to subscription models and buy now, pay later (BNPL) options, these integrations provide retailers with new ways to manage customer experiences, enhance conversion rates and drive efficiency, all while navigating mounting compliance and fraud prevention challenges.

The report shows that adoption is nearly universal. Nearly every retailer in the survey now uses embedded finance, and most report that it’s giving measurable business results. More than eight in 10 cite better customer experiences as an important benefit, while two-thirds report operational efficiencies. Yet as embedded finance scales, so does its complexity. With 88% of firms struggling with regulatory compliance—and 72% of those offering credit products facing heightened fraud risk—retailers are forced to rethink what defines success. Many judge embedded finance partnerships by their ability to manage risk, ensure data protection and support seamless integration across systems.

In “Retailers Expand Embedded Finance to Unlock Control and Customization,” learn how:

• Retailers are using embedded finance as a control point. They’re turning payment choice, rewards and financing into tools for deeper loyalty and brand differentiation.
• Compliance and fraud defenses are becoming competitive advantages—with retailers prioritizing security-first partners who simplify regulation, not complicate it.
• Strategic alignment drives long-term payoff. Retailers that embed finance into the heart of their customer journey gain agility, data insight and sustainable growth.

This report offers a data-rich roadmap for retailers poised to move beyond transactions and use embedded finance to shape the next generation of customer engagement.

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“Retailers Expand Embedded Finance to Unlock Control and Customization” is based on a survey of heads of payment at 37 retailers in the U.S. held in July 2025. All respondents work at commerce companies with existing embedded capabilities, spanning sectors such as eCommerce, travel and marketplace platforms. The study examines how firms use these tools to enhance operations, minimize friction, mitigate regulatory risks and assess success. The sample included a mix of firms with diverse capabilities, including co-branded cards, wallets, lending tools and subscription payments. The findings offer a snapshot of how these strategies vary by company maturity, business model and capability mix.

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