Vertical Software Owns Embedded Finance

The real prize in embedded finance is owning the workflow before owning the card. Vertical software already runs the customer’s day to day job, so adding accounts, cards, or lending becomes an extra button inside an existing product, not a separate app that must win attention from scratch. That gives software companies better distribution, more transaction context, and more ways to turn payment data into retention, new revenue, and follow on products like instant payout or credit.

• Squire shows the pattern clearly. Its barbershop software already handles bookings and checkout, so Bond could add instant wage access through Squire Card at the moment a haircut is paid for. The financial product fits directly into an existing workflow and solves a specific cash flow problem.
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• Pure fintechs often start with a card and then hunt for a durable use case. Vertical SaaS starts with a job the customer already pays for, then monetizes the money movement inside it. In later research, Roy Ng said the company doubled down on vertical SaaS because the value proposition was clearer at scale.
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• This is why embedded finance has shifted from generic neobanks toward software platforms like Shopify, Toast, and other vertical tools. Research on interchange found about 80% of vertical software companies already offer payments, but far fewer offer broader financial products, leaving a large expansion path beyond payments alone.
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Going forward, the winners are likely to be software companies that already control a specialized workflow and can layer in financial products one by one. As compliance standards rise and distribution gets harder, embedded finance becomes less about launching another fintech brand and more about turning industry software into the system that also moves money.