From theory to action: how banking-as-a-service in Europe is operationalizing Open Banking and unlocks a multi-billion dollar opportunity

Maximilian Salomon

Chapter 6 in Research Handbook on FinTech, 2026, pp 100-119 from Edward Elgar Publishing

Abstract: In recent years, the European banking sector has undergone a profound digital transformation, which has resulted in a significant reshaping of market dynamics. One reason for this is the rise of Banking-as-a-Service (BaaS), which operationalizes the principles of open banking. BaaS enables new players, including fintechs, bigtechs, and non-financial companies, to rapidly integrate financial services into their offerings, challenging traditional industry boundaries. The main objective of this book chapter is to examine the impact of BaaS on the European financial services market. The analysis is based on extensive research and examines the technical and operational foundations of BaaS. The findings illustrate the remarkable growth in demand and supply of BaaS in Europe in recent years. From simple co-branding for credit cards to highly sophisticated solutions, the industry has evolved significantly. The findings suggest that the BaaS market is poised for a second phase of growth, driven by continued innovation, an improved regulatory framework, and the entry of more players.

Keywords: Open banking; Banking-as-a-service; Europe; Banking; Embedded finance; Fintech (search for similar items in EconPapers)
Date: 2026
ISBN: 9781035321414
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