Understanding embedded finance: Introducing SeerBit Alpha

Globally, the embedded finance sector is expected to be worth $7.2tn by 2030, with revenues reaching $121bn by 2029 in the UK and Europe, a 187% increase from 2022. In Nigeria, the market value of embedded finance is predicted to be over $8 billion by 2029.

According to the World Bank, only 40% of Nigeria’s adult population has access to financial services, indicating a significant opportunity for developing embedded finance solutions. In addition, Nigeria’s smartphone penetration rate is over 50%, highlighting the potential of digital solutions to increase financial inclusion.

Embedded finance is the integration of financial services like lending, payment processing or insurance into non-financial businesses' infrastructures without the need to redirect to traditional financial institutions. Basically, embedded finance is the use of financial tools and services by a non-financial provider.

During the last edition of #BDTalks, held on Tuesday, we dive deep into the intriguing world of embedded finance, its challenges and opportunities. The event saw Henry Okorie, Product Manager, SeerBit; Debola Adefarati, Marketing Lead, SeerBit and Levi Cee Industry analyst, Benjamindada.com share ideas and insights on the topic.

SeerBit is a payment solutions company that makes it easy for businesses to receive money from their customers. Delving deeper into what they do, Debola Adefarati, the Marketing Lead at SeerBit said, “We recognized that receiving money is only one leg of payments.

So we started making it easy for businesses to move money around, either by making payments to their vendors or by moving it around their internal organisation. So we decided to create solutions that’ll help businesses move money around internally and externally and by moving money more efficiently, we actually generate more value from them.”

Challenges businesses encounter when they try to integrate embedded finance

Henry Okorie: Integrating financial services into existing products can offer numerous benefits to businesses, such as enhancing customer engagement and increasing revenue streams.

However, it also comes with several challenges that businesses encounter often. These challenges include data security, regulatory compliance, risk management, difficulties around technology integration, scalability and customer support.

Financial data is sensitive information, and it requires a high level of security. Over the years, we’ve seen that businesses often have challenges ensuring that such data are adequately secured and ensuring that there are no security breaches for customer data.

Benefits of integrating embedded finance technology like SeerBit Alpha, rather than building from scratch?

Debola Adefarati: Like any product or any technology out there, it's one thing to want a financial services product, it's another thing actually to be able to do it. Most companies go through this whenever they conceive this idea.

You also see all the excitement and hype when you start building, but you realise that it's not as easy as you thought. Most imagine that this idea will take like six months to build, and then you can take over the market.

But you realise that in one and a half years you're still building, and there's no growth anywhere. So you keep building and building, and you realise that everything takes more time than it used to be.

But with embedded finance, you have a stable system. For example, you want to expand a service to your customers. Instead of having an 18-month build plan that you're not necessarily sure your company will pull through, you can actually get going in two to three months and have a product that is live without actually skipping a bit.

Real world examples of businesses that have successfully used SeerBit Alpha to enhance their services?

Henry: Okay, so we have 9 payments service banks. They have used digital banking service. It's a service that enables them to provide a digital service for their customers. There's a mobile version and there's a Web version.

Our remittance service infrastructure is also currently being used by two banks in Nigeria. We also have our payments' infrastructure that offers virtual accounts creation for financial institutions and is currently being used by two financial institutions in Nigeria.

How does SeerBit Alpha ensure security and compliance when handling financial institution?

Debola:  SeerBit is regulated because we operate in a very regulated space. But also we have certifications like the PCI DSS, and the other certifications. This ensures that we have data protection. So everything is encrypted end to end.

We don't have any problems on any server per the PCI DSS requirements, so anything running on our rails is actually secure. So far, we've not had any breaches on our internal systems and none from our partners.

We have detection systems in-house to ensure that if there's any discrepancy in any particular transaction, we quickly identify it and notify them. We also have this type of analytics to ensure that everything is smooth regarding the operations.

You can catch up on the conversation here