Point Solutions Win in BaaS

These companies win by becoming the best tool for one hard job, not by owning the whole banking stack. Lithic handles card issuing, Alloy handles identity and fraud checks, and Sila handles ACH, ledgering, and money movement. That narrower scope usually means slower revenue per customer than an all in one platform, but it also makes them easier to plug into many different embedded finance products, which spreads revenue across more customers and use cases.

• Lithic sits close to the card rails. It gives developers the primitives to create and control cards, like issuing a virtual card with a spend limit or approving and declining transactions in real time. That makes it useful inside many other fintech products, including broader BaaS platforms that need card infrastructure under the hood.
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• Alloy solves the identity checkpoint at account opening and ongoing fraud review. A fintech can send user data to Alloy, run KYC and fraud vendors through one workflow, and decide whether to approve the account. That is a valuable wedge, but it captures only one slice of the economics, so growth tends to come from expanding across many customers rather than taking more of each customer stack.
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• Sila is the clearest example of modular money movement. It focuses on ACH, ledgers, KYB and KYC, then partners for cards, bill pay, and other functions. That fits embedded finance customers that want to move money inside a real estate app, crypto app, or vertical software product, without buying a full neobank in a box.
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Going forward, the market is likely to split by customer maturity. Early teams will keep buying bundled platforms to launch faster. As customers scale, more of them will swap in point solutions for the parts that matter most, because card issuing, identity, and money movement become too important to accept as average quality features inside a bundle.