(MENAFN- GlobeNewsWire - Nasdaq) The Italian embedded finance market is thriving with opportunities in specific sectors. SME lending is expanding rapidly through digital platforms, addressing longstanding credit gaps. Embedded insurance is targeting urban mobility and lifestyle sectors. BNPL is growing in retail, while fintech-bank collaborations boost innovation across finance ecosystems.Dublin, Nov. 20, 2025 (GLOBE NEWSWIRE) -- The "Italy Embedded Finance Market Size & Forecast by Value and Volume Across 100+ KPIs by Business Models, Distribution Models, End-Use Sectors, and Key Verticals (Payments, Lending, Insurance, Banking, Wealth) - Databook Q4 2025 Update" report has been added to ResearchAndMarkets's offering.
The embedded finance market in Italy is expected to grow by 7.1% on an annual basis to reach US$11.96 billion by 2025. The embedded finance market in the country has experienced robust growth during 2021-2025, achieving a CAGR of 10.3%. This upward trajectory is expected to continue, with the market forecast to grow at a CAGR of 4.9% from 2026 to 2030. By the end of 2030, the embedded finance market is projected to expand from its 2024 value of US$11.17 billion to approximately US$14.51 billion.
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Across lending, insurance, payments, and mobility, embedded finance in Italy is evolving through sector-specific use cases rather than horizontal platforms. Fintech adoption remains moderate compared to peers like Germany or France, but Italy's regulatory alignment with EU digital finance reforms, coupled with growing digital consumption patterns, is driving steady momentum. Over the next 2-4 years, expect Italy's embedded finance landscape to intensify in vertical depth especially in SME lending, lifestyle insurance, and urban mobility while broader integration across banking and retail ecosystems continues to develop.
B2B Embedded Lending Is Expanding Among Italian SMEs
Embedded lending solutions are increasingly being adopted in Italy's B2B segment, particularly by small and mid-sized enterprises (SMEs) seeking faster access to credit within the platforms they already use for procurement or invoicing. For instance, Credimi a digital lender focused on SMEs has been collaborating with ecosystem platforms to offer credit products directly at the point of need. Italian marketplaces and procurement platforms are also embedding credit solutions into supplier portals to ease working capital friction. The key driver is the longstanding credit gap faced by SMEs in Italy, often due to traditional underwriting delays by banks. The digitization of B2B workflows through platforms like TeamSystem and Fatture in Cloud creates a natural entry point for embedded lending providers. The 2023 EIB Investment Survey showed persistent financing obstacles among Italian SMEs, reinforcing demand for more integrated and responsive credit access. This trend is likely to intensify, with embedded B2B lending expected to expand across vertical SaaS platforms and digital invoicing ecosystems. The growth of e-invoicing, coupled with EU-backed digital finance reforms, will accelerate API-based integration of lending products into ERP and supplier systems.
Embedded Insurance Solutions Are Targeting Mobility and Lifestyle Use Cases
Embedded insurance is gaining traction across mobility, travel, and electronics retail in Italy. Companies such as Telepass are embedding micro-insurance offerings (e.g., accident or breakdown protection) within subscription and tolling services. Similarly, e-commerce platforms like Unieuro and MediaWorld embed extended warranty products within checkout flows for consumer electronics. The rise of on-demand consumption in Italy, particularly in urban centers, is increasing demand for low-ticket, bundled coverage options. Italian consumers are also showing growing willingness to adopt usage-based or pay-per-use models, which aligns well with embedded insurance tied to specific products or experiences. Regulatory flexibility introduced by IVASS (Italy's insurance regulator) around digital insurance distribution is another enabler. The embedded insurance market is expected to stabilize but diversify in terms of use cases. With further regulatory clarity from IVASS and deeper partnerships between insurers and digital platforms, the next growth wave will likely involve lifestyle insurance embedded into fintech apps, ticketing platforms, or subscription services.
BNPL (Buy Now Pay Later) Embedded Into Retail and E-Commerce Ecosystems
BNPL adoption is growing steadily in Italy through integration with both online and in-store retail platforms. Scalapay remains a dominant player, offering pay-in-three options at checkout across major fashion and lifestyle brands such as Calzedonia and Liu Jo. Klarna and PayPal also maintain strong merchant partnerships across Italian e-commerce, embedding BNPL within payments flows. The key driver is demand from younger consumers for flexible, short-term credit options without traditional bank friction. Italian e-commerce continues to grow post-pandemic, and embedded BNPL offers a frictionless upsell tool for merchants. Payment service providers are incentivized to include BNPL options as a value-added feature in merchant integration packages. The embedded BNPL market is expected to intensify, with new models (e.g., B2B BNPL or invoice factoring) emerging alongside consumer use cases. Tighter scrutiny by the Bank of Italy on consumer protection may reshape disclosure requirements, but the underlying demand for embedded checkout financing is unlikely to taper.
Fintech-Bank Collaborations Are Accelerating Embedded Finance Integration
Banks in Italy are increasingly partnering with fintechs and technology providers to integrate embedded finance use cases especially in areas such as digital payments, personal finance tools, and card-linked services. For example, Fabrick (a Banca Sella initiative) continues to expand its API marketplace for third-party integration, supporting embedded finance across multiple touchpoints. Italian banks face competitive pressure from both domestic fintechs and European neobanks. Collaborating through API layers allows banks to remain relevant in the value chain while outsourcing innovation. Regulatory encouragement of open finance under PSD2 and the upcoming PSD3 has further accelerated interest in embedded models that rely on bank-fintech partnerships. This trend will intensify as Italy prepares for PSD3 and digital identity frameworks under the EU Digital Finance Strategy. More banks are expected to adopt platform-based models, enabling embedded offerings such as personalized savings nudges, loyalty-linked payments, or embedded credit scoring within third-party apps.
Mobility and Smart City Platforms Are Testing Embedded Payments and Tolling
Embedded finance is being piloted in Italy's urban mobility sector, especially in the integration of toll payments, fuel cards, and transport services. Telepass has expanded its embedded tolling and micro-payment features across public and private transport networks. Similarly, startups like Satispay are embedding payments within mobility platforms, including parking and charging stations. The development of smart cities, increasing adoption of mobility-as-a-service (MaaS), and Italy's decarbonization commitments are pushing cities and operators to unify payments across modes of transport. Consumer preference for seamless mobility experiences especially in cities like Milan and Rome further supports this evolution. The embedded payments trend in mobility will likely accelerate, supported by EU-level smart mobility funding and digital infrastructure upgrades. Multi-service embedded wallets and single-click checkout for tolls, parking, and transit could become more mainstream, especially as municipal-level partnerships mature.
Embedded Finance Activity Is Increasing but Remains Concentrated in Specific Verticals
Embedded finance in Italy is still in a growth phase, with activity largely concentrated in retail payments, SME lending, and digital insurance. While the ecosystem is less saturated than in Northern Europe, competition is intensifying in areas like Buy Now Pay Later (BNPL) and embedded B2B credit. The maturity of Italy's digital infrastructure and moderate fintech adoption rates have resulted in a market led by a few dominant platforms often tied to banks or telcos rather than a broad set of digital-native disruptors. Unlike markets with high fintech proliferation, Italy's embedded finance landscape is being shaped by hybrid entities such as Fabrick that operate both as enablers and service providers. This structure has kept competitive intensity moderate, but concentrated, with increased collaboration between incumbent banks and API-centric fintechs. The market is expected to diversify, particularly as embedded models extend into mobility, utilities, and enterprise software platforms. However, a few dominant infrastructure enablers are likely to maintain control over core payment and lending rails unless major new entrants disrupt the stack.
Key Players Span Fintechs, Banks, Telcos, and Sector-Focused Platforms
Scalapay remains a prominent player in the embedded BNPL segment, operating with merchant integrations across e-commerce and fashion verticals. Fabrick, owned by Banca Sella, functions both as a fintech and a middleware API platform, powering embedded finance offerings across partners such as Nexi and Enel X. Telepass, traditionally a toll operator, has broadened into embedded finance with micro-insurance, payments, and mobility-linked financial products. Satispay, a mobile payments startup, has expanded its in-app payment capabilities across everyday merchant categories, embedding finance into retail and transport flows. Newer startups and sector-specific SaaS platforms are entering the embedded lending and insurance markets, including players like Yolo Group (embedded digital insurance) and Opyn (digital SME lending). These firms are building API-first products that integrate directly into retail, travel, and e-invoicing platforms. A handful of infrastructure-layer players especially Fabrick are expected to anchor the growth of embedded finance in Italy, while use-case-specific players in insurance, lending, and payments expand across sector platforms.
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