BaaS providers revenues to more than double by 2028

The BaaS space has generated $36.4b in revenue as of 2024.

Banking-as-a-Service (BaaS) platforms’ revenues from account/ card issuing and transaction fees are expected to more than double in four years, as more are deployed across e-commerce and freelance platforms, reports Juniper Research.

BaaS platforms have generated $36.4b in revenue as of 2024. This value is forecasted to expand by 158% to 2028.

“This expansion primarily comes from API deployment across eCommerce and freelance platforms, by connecting consumers to innovative financial tools, and [is] unlocking additional revenue streams for BaaS providers,” Juniper Research said in a press release.

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The BaaS business model involves the delivery of digital banking services by licenced banks. 

However, it is not without its issues. Regulator friction is raising the cost of compliance for BaaS providers, Juniper Research noted.

Notably, issues with KYC (Know Your Customer) processes are increasing hte scope of compliance programmes. This may make it harder for smaller fintech companies from non-traditional backgrounds to succeed in the BaaS space.