Latest / Leaders In Payments / Embedded Finance Series: Banking & Lending with Sunil Sachdev, Fiserv | Episode 533

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Embedded Finance Series: Banking & Lending with Sunil Sachdev, Fiserv | Episode 533 · Leaders In Payments

• 0:00
  SPEAKER_01: Hello, everyone, and welcome to the Leaders in Payments Podcast.
• 0:03
  SPEAKER_01: I'm your host, Greg Myers.
• 0:04
  SPEAKER_01: And as many of you know, embedded finance has quickly become one of the most important conversations in payments and fintech.
• 0:11
  SPEAKER_01: More vertical software companies are looking beyond their core platforms and exploring how payments and other financial products can create new revenue, strengthen customer relationships, and deliver a more seamless experience.
• 0:23
  SPEAKER_01: It is also the focus of Embedify, the Embedded Finance Summit.
• 0:26
  SPEAKER_01: I'm hosting on October 13th in Lehigh, Utah, where Vertical SaaS leaders, technology providers, and industry experts will come together to discuss how embedded finance is being built and deployed in the real world.
• 0:40
  SPEAKER_01: We'll be talking not only about payments but also lending, banking, insurance, accounting, and payroll.
• 0:45
  SPEAKER_01: You can learn more at Embedify2026.com.
• 0:48
  SPEAKER_01: As we lead up to the event, I'm talking with industry leaders who are helping software companies navigate the embedded finance opportunity.
• 0:57
  SPEAKER_01: As we lead up to the event, I'm talking with industry leaders who are helping software companies navigate the embedded finance opportunity.
• 1:04
  SPEAKER_01: You can learn more about the event and register at Embedify2026.com.
• 1:09
  SPEAKER_01: My guest today is Sanil Sachdev, SVP head of embedded finance and digital assets at FISERV.
• 1:15
  SPEAKER_01: So Sanil, welcome to the show.
• 1:16
  SPEAKER_00: Greg, thanks for having me.
• 1:18
  SPEAKER_00: Looking forward to it.
• 1:19
  SPEAKER_01: Great.
• 1:19
  SPEAKER_01: So before we get into the embedded finance discussion, can you give us a little background on your career and maybe how you found your way into this great payments industry?
• 1:27
  SPEAKER_00: Well, yeah, no, happy to do so.
• 1:30
  SPEAKER_00: Uh I've been in payments for over two decades, Greg.
• 1:33
  SPEAKER_00: I guess, you know, my real education in payments started during my tenure at American Express.
• 1:39
  SPEAKER_00: American Express was, you know, a and continues to be a great company.
• 1:44
  SPEAKER_00: I had uh a lot of experience across the issuing side of the business, the acquiring side of the business, and the network side of the business.
• 1:51
  SPEAKER_00: I also had the privilege of running the merchant business for South Asia during my tenure at American Express.
• 1:58
  SPEAKER_00: So I learned a lot about emerging markets and how they're different than developed markets, especially as we were looking at payments modernization across different verticals in India.
• 2:10
  SPEAKER_00: And India is a marketplace that was very unique at the time that I was there, where you know it went straight from landlines to satellite very quickly.
• 2:21
  SPEAKER_00: And on the satellite side, that allowed for some great connectivity that ushered in a new renaissance from a digital payments perspective.
• 2:30
  SPEAKER_00: So I also had a brief stint at a startup before coming to FISERV, and FISERV as a leader in bank and payments tech, learned a lot here, both again in developed and emerging markets on how payment rails are necessary to ensure appropriate exchange of value as well as commerce around the world.
• 2:51
  SPEAKER_01: Okay.
• 2:51
  SPEAKER_01: Well, obviously our audience will know FiveServe well, but can you give us an overview of the capabilities FISERV has around the embedded finance space?
• 3:00
  SPEAKER_00: Yeah, look, FiServe, as I mentioned, is a leader in bank tech and payment tech.
• 3:05
  SPEAKER_00: It's a company with lots of great history and great expertise around core banking as well as payment processing.
• 3:14
  SPEAKER_00: When you think about embedded finance, you know, FISERV operates at the intersection of banking and payments.
• 3:20
  SPEAKER_00: And embedded finance is just that, right?
• 3:23
  SPEAKER_00: It's the ability to work with our merchant partners, our corporates, our enterprise customers, and allow them access to bank-like services that will enhance customer journeys that result in more beneficial outcomes for their users, whether they're retail customers or business customers.
• 3:43
  SPEAKER_00: Pfizer's got, let's say, about 5 trillion in payment volume.
• 3:48
  SPEAKER_00: That's it processes on an annual basis.
• 3:50
  SPEAKER_00: We support about 300 million in bank accounts around the world, and we have millions of merchants.
• 3:57
  SPEAKER_00: So from that perspective, you know, the ecosystem's quite robust.
• 4:00
  SPEAKER_00: It moves a lot of value for both payment transactions as well as banking transactions.
• 4:06
  SPEAKER_01: Well, Sunil, embedded finance has become an incredibly broad term.
• 4:10
  SPEAKER_01: So when you're talking to vertical SaaS companies today, how do you define embedded finance for them?
• 4:16
  SPEAKER_01: And where do you see the biggest opportunities maybe beyond just the embedded payments opportunity?
• 4:21
  SPEAKER_00: Well, vertical SaaS is one of the fastest growing segments for the company.
• 4:26
  SPEAKER_00: And it all starts by looking at the business model or the industry the vertical SaaS company is in, Greg, for us.
• 4:34
  SPEAKER_00: And for me, one, I talk to the vertical SaaS companies about attachment rates in terms of additional services they'd like to sell.
• 4:43
  SPEAKER_00: You know, whether you're in the healthcare industry, the construction industry, or just working as a large ISO to support small businesses in a specific community, I think the process is all about looking at diversification of revenue first, right?
• 4:58
  SPEAKER_00: And helping enhance the margins and the revenue that comes into that vertical SaaS company by offering incremental value to their customers.
• 5:08
  SPEAKER_00: Now, the customers could basically look at, you know, additional lines of credit that helps with purchasing power for their customers, or they could just be looking at greater yield on the money that flows through their pipes.
• 5:21
  SPEAKER_00: And we we acquired a company called Stonecastle last year that helps us do just that, providing greater yield back to vertical SaaS companies that have a lot of operating capital that moves between their pipes.
• 5:33
  SPEAKER_00: And the third is just, you know, plain old embedded banking services, like being able to facilitate access to funds that could be in a bank account or through a line of credit that increases purchasing power for the end customer that allows the vertical SaaS company to process more transactions and sell more value into their existing clients.
• 5:57
  SPEAKER_01: Okay.
• 5:57
  SPEAKER_01: Well, as you mentioned, FiveServe has all these capabilities across payments and banking and lending.
• 6:03
  SPEAKER_01: So for a vertical SaaS company that's looking at all this menu of products, how should they go about deciding what to add next rather than just trying to do all this financial stuff at the same time?
• 6:15
  SPEAKER_00: Well, I think it's an appreciation of their customer, right?
• 6:18
  SPEAKER_00: You know, as they think about who their target segment is, you know, if they're a vertical SaaS company in the healthcare industry, what's the actual pain point that they think they can solve for the doctor's offices that they're in?
• 6:32
  SPEAKER_00: Is it claim adjudication?
• 6:34
  SPEAKER_00: Is it access to capital?
• 6:36
  SPEAKER_00: Is it a line of credit that will help that small business basically grow their business and their footprint?
• 6:44
  SPEAKER_00: Or is it, you know, B2B2C services where they could provide payroll card services or other types of lines of credit to their end users that allows them to purchase more?
• 6:56
  SPEAKER_00: You know, one great example recently is we worked with an ISO or an ISV in the healthcare industry, and they were helping customers kind of bridge the gap between insurance and payment for cosmetic surgery, right?
• 7:13
  SPEAKER_00: Whether it's for dental or other reasons, and giving them access to a line of credit or giving them access to enhanced purchasing power allowed them to complete that transaction.
• 7:24
  SPEAKER_00: And then helping the small business be able to collect on those funds as well, I think was an important piece of our value proposition.
• 7:33
  SPEAKER_01: Well, you know this as well as anyone.
• 7:35
  SPEAKER_01: We've seen tremendous success of companies, vertical SaaS companies monetizing payments.
• 7:40
  SPEAKER_01: But when you move into these other products that we're we're talking about, maybe beyond you know payments, where you know the business case was always around growing your revenue.
• 7:50
  SPEAKER_01: But what should the operators be looking at for these other products?
• 7:54
  SPEAKER_01: Does the business case change or is it still really about incremental revenue?
• 7:58
  SPEAKER_00: I think for the operators, it's it's not just about incremental revenue.
• 8:03
  SPEAKER_00: I think it it really does come down to how do you enhance the value proposition you're providing to your clients today, right?
• 8:10
  SPEAKER_00: And that could be the fact that by providing embedded financial services, you have access to more data.
• 8:16
  SPEAKER_00: And that data helps your clients monetize their information in a way that's very differentiated through campaigns, marketing, other types of services they can offer.
• 8:27
  SPEAKER_00: Or there's an actual kind of work that's being done through the data to understand adjacent services that could also be offered through that same relationship.
• 8:37
  SPEAKER_00: And then lastly, as I mentioned earlier, what about cash flow?
• 8:41
  SPEAKER_00: You know, cash flow becomes a huge kind of need for small businesses.
• 8:47
  SPEAKER_00: Vertical SaaS companies that sell software into these specific verticals have a good appreciation of the cash flow dynamics in that vertical.
• 8:56
  SPEAKER_00: So whether it's a business that runs seasonally or a business that has lots of troughs and valleys and peaks in terms of cash flow, there's an opportunity to kind of normalize that and forecast that for that small business.
• 9:10
  SPEAKER_00: So all of these services are things that you would normally get from a financial institution.
• 9:16
  SPEAKER_00: And I think that's what embedded finance is all about, is just kind of that transference with having that relationship with a financial institution to having that relationship with a vertical SaaS company.
• 9:29
  SPEAKER_01: Okay.
• 9:29
  SPEAKER_01: Well, we hear a lot in the industry about making embedded finance services available at the point of need.
• 9:36
  SPEAKER_01: And I think when you think of that, a lot of people think of lending because of the data, like you mentioned.
• 9:41
  SPEAKER_01: But how much of getting this right is actually about the financial product versus understanding the workflow and then and knowing exactly when a product should be visible to the end user in that software experience?
• 9:54
  SPEAKER_00: Yeah, no, it's a great question, Greg.
• 9:56
  SPEAKER_00: I think, look, I think both are important.
• 9:59
  SPEAKER_00: Obviously, if you offer a lending product that has a payment structure or a repayment structure that's not tenable to the clients there or does not offer enough of uh purchasing power for them to actually complete the purchase at point of sale, it's a bad product.
• 10:16
  SPEAKER_00: But at the same time, if you if you have the right lending product, you're absolutely right.
• 10:21
  SPEAKER_00: The other half of it is surfacing it at the appropriate time in the workflow, whether that's at the checkout part of it or whether that's early on in the actual kind of discovery of the item that's being purchased or the service that's being purchased.
• 10:38
  SPEAKER_00: I think there's a lot that can be done when data is shared between two or three companies in the background that allows for a smoother customer experience.
• 10:47
  SPEAKER_00: And FISERV has done this well in the past.
• 10:51
  SPEAKER_00: You know, in addition to providing the banking services, we have surface area through our point of sales, through our connectivity, through our Commerce Hub for Payments enterprise platform, where we're able to provide APIs that seamlessly can help, you know, ISVs and vertical SaaS companies surface, you know, these types of options for payment and options for credit or banking at the right point in the experience.
• 11:20
  SPEAKER_01: Okay.
• 11:20
  SPEAKER_01: One of the biggest concerns that I often hear from these vertical SaaS companies is complexity.
• 11:26
  SPEAKER_01: And that can range from a lot of things, right?
• 11:27
  SPEAKER_01: There's sponsor banks, there's compliance, there's KYC, there's fraud, reconciliation.
• 11:31
  SPEAKER_01: I mean, all these operational pieces that are kind of behind the scenes.
• 11:36
  SPEAKER_01: So, in your opinion, how much of that should the SaaS platform own versus relying on, you know, their embedded finance partner?
• 11:43
  SPEAKER_00: Yeah, no, it's a great question.
• 11:45
  SPEAKER_00: And I think it it comes down to kind of, you know, how much they are willing to tolerate in terms of either risk or as well as oversight from a regulatory perspective, right?
• 11:57
  SPEAKER_00: I think FIServe offers a number of different options.
• 12:01
  SPEAKER_00: We can offer a processing option where the vertical SaaS company takes on a lot of the ownership for KYC, KYB, as well as compliance and reconciliation.
• 12:12
  SPEAKER_00: And we're just the tech in the background to process those transactions.
• 12:16
  SPEAKER_00: But we also have a full service model where we can basically handle customer onboarding all the way through transaction processing and then settlement and reconciliation at the end.
• 12:27
  SPEAKER_00: This way, as a regulated company, FiServe is used to different types of audits from regulators on its payment stack already.
• 12:36
  SPEAKER_00: Today, we work with a number of sponsor banks who are going to be needed regardless because only they can offer these types of regulated banking and payment services.
• 12:46
  SPEAKER_00: So we have those relationships as well.
• 12:49
  SPEAKER_00: So we can obfuscate a lot of that complexity for the vertical SaaS company.
• 12:54
  SPEAKER_00: Obviously, it's up to the SaaS company in terms of the types of products and services they want to offer and how much of their balance sheet they want to put in front of their customers.
• 13:04
  SPEAKER_00: I think those are the types of questions we usually ask during a discovery period where we can tell them here's where we think you should draw the line, and where from an ROI perspective, it makes sense for them to do so.
• 13:17
  unknown: Okay.
• 13:18
  SPEAKER_01: Well, the next is a two-part question.
• 13:20
  SPEAKER_01: So the first part is, you know, as you've, as you well know, we've spent years talking about this huge embedded finance opportunity.
• 13:27
  SPEAKER_01: I mean, it is a massive opportunity.
• 13:28
  SPEAKER_01: But from your vantage point, where are we actually on the adoption curve of that today?
• 13:33
  SPEAKER_00: Look, I think it continues to accelerate.
• 13:36
  SPEAKER_00: And the corollary, as I'm sure, Greg, you know, is the number of digital transactions that happen today, right?
• 13:42
  SPEAKER_00: And if you also look at from a generational perspective, you know, digital natives are are coming into kind of prime earning years as well, right?
• 13:51
  SPEAKER_00: So as you look out, and I know it from just wallet share myself, even though I'm not a millennial or a Gen Z by any stretch, I still see a large percent of my cash payments being done digitally today.
• 14:05
  SPEAKER_00: So, from that perspective, uh, and a lot of them are done through commerce experiences and services where a bank is far behind that experience, right?
• 14:16
  SPEAKER_00: So for me, embedded finance will continue to accelerate.
• 14:19
  SPEAKER_00: I think the legislation, the regulations, other things that kind of help foster a safer environment for digital payment transactions, continues to mature.
• 14:30
  SPEAKER_00: So all of these aspects, whether it's kind of the demographic, the pace of technology, and the supporting regulation, I think all of these things are just creating more and more of a safer environment for these embedded financial services to continue to grow.
• 14:48
  SPEAKER_00: And I think the way the rise of AI and agentic commerce today, which takes that data to another level in terms of predictive analytics and making sure that customers have the right outcome for every experience that they enjoy on a commerce platform, I think that'll continue to drive a very strong tailwind as well.
• 15:10
  SPEAKER_01: So when you think about specifically the vertical SaaS community, I've read stats that say 75, 80% of them already offer payments in some way, shape, or form.
• 15:20
  SPEAKER_01: But where do you think we are when you look at all the other products that are potentially out there, payroll, accounting?
• 15:26
  SPEAKER_01: I mean, we've talked about them.
• 15:28
  SPEAKER_01: So where do you think we are?
• 15:29
  SPEAKER_01: Are we in the first inning still or are we we getting towards the middle of the game?
• 15:32
  SPEAKER_00: Oh no, that's a that's a great question.
• 15:34
  SPEAKER_00: I think look, the vertical SaaS segment, as I mentioned earlier, is a fast growing segment for the company.
• 15:40
  SPEAKER_00: And the conversations I've had is that everybody's thinking about it now, right?
• 15:45
  SPEAKER_00: So they're thinking about embedded payments, you're absolutely right.
• 15:48
  SPEAKER_00: I think that's kind of table stakes and 75%, 80%.
• 15:52
  SPEAKER_00: I'll take your reference point, Greg.
• 15:54
  SPEAKER_00: I think sounds absolutely right.
• 15:56
  SPEAKER_00: I think when you look at embedded banking, lending, money movement, buy now, pay later, everybody's talking about it at the board level.
• 16:05
  SPEAKER_00: We're seeing more and more RFPs come out for those types of services.
• 16:10
  SPEAKER_00: We're seeing good demand for that.
• 16:12
  SPEAKER_00: So I would say that maybe not in the middle innings, but maybe third or fourth inning, you know, we're definitely past the first tranche.
• 16:20
  SPEAKER_00: I think very much so.
• 16:21
  SPEAKER_00: Everybody understands the link between offering more financial services to growing margins and growing attachment rate and stickiness with their customers.
• 16:33
  SPEAKER_01: Okay.
• 16:34
  SPEAKER_01: Well, what do you think that the more sophisticated software platforms are doing now that maybe they weren't doing two or three years ago?
• 16:41
  SPEAKER_00: Well, we've we've talked to a number of them, and I think uh a number of them have gone beyond just offering financial services to their client.
• 16:49
  SPEAKER_00: And a couple of them are now thinking about what their client's client would want to happen, right?
• 16:54
  SPEAKER_00: And I gave you that example early on about a vertical SaaS company offering, you know, software to a bunch of doctors' offices or dental offices.
• 17:05
  SPEAKER_00: You know, the first thing they did was embed payment.
• 17:08
  SPEAKER_00: So the the uh back office didn't have to go to two, three different systems to reconcile their claim versus the payment.
• 17:14
  SPEAKER_00: That was kind of step one.
• 17:16
  SPEAKER_00: Step two was offering some type of line of credit to that office as well so they could purchase more dental equipment or or other healthcare equipment that they need.
• 17:28
  SPEAKER_00: Now they're starting to think about hey, what about payroll services so I can help that small business pay their employees as well?
• 17:36
  SPEAKER_00: And then soon after that, we got a call about, hey, is there a way that we could extend purchasing power to the patients that come into that office so that they're able to get everything that they need that bridges that gap with insurance?
• 17:50
  SPEAKER_00: So I think B2B was the first thing that we saw in terms of set of or a suite of financial services for that business.
• 17:59
  SPEAKER_00: But now we're seeing B2B to C financial services.
• 18:02
  SPEAKER_00: So being able to extend that to the customer or the employee of that business as well.
• 18:08
  SPEAKER_01: Well, if you were sitting across the table from a CEO of a vertical SaaS company that's already embedded payments successfully, and they look at you and they say, Sunil, what should our financial services strategy look like over the next, say, two to three, five years?
• 18:23
  SPEAKER_01: What questions would you tell them they need to be asking themselves?
• 18:27
  SPEAKER_00: Yeah, I think similarly to you know what we discussed about the B2B side, right?
• 18:32
  SPEAKER_00: I think, look, if you got embedded payments, I think the questions you should ask yourself and to the client is where else can I help you kind of organize your back office, decrease your operational expense, increase your cash flow?
• 18:46
  SPEAKER_00: Because I'm a large part of how you operate your overall business today.
• 18:52
  SPEAKER_00: I'm looking to expand horizontally across those different places where you need help from a cash flow perspective, right?
• 18:59
  SPEAKER_00: When you do embedded payments, you're basically the engine of that business, right?
• 19:05
  SPEAKER_00: You're a lot of that operating capital that the business uses to fund other parts of its endeavor come from the embedded payment stack.
• 19:15
  SPEAKER_00: So it's only natural to have that next conversation that says, hey, look, this is how much settlement I'm doing with you on a daily basis or a weekly basis.
• 19:25
  SPEAKER_00: How can I help you kind of make that dollar that settles within your account go longer, go further for you?
• 19:32
  SPEAKER_00: What else can I do there?
• 19:33
  SPEAKER_00: And I think that's the start of that B2B relationship and adding more of those adjacent services.
• 19:39
  SPEAKER_00: And then in year two or year three, but after you get the business side done and there's a good level of confidence, it's okay, how can I help your customers purchase more from you?
• 19:50
  SPEAKER_00: What else can I do here from a financial services perspective that will help you kind of increase the business that you're doing?
• 19:57
  SPEAKER_00: So we go from uh, hey, how do I help you kind of get more efficient with your banking relationships and your payment relationships today, based on embedded payments business I have with you?
• 20:09
  SPEAKER_00: To how do I now increase the size of your business?
• 20:12
  SPEAKER_00: How do I get more payments coming through your pipes, you know, as a relationship?
• 20:17
  SPEAKER_00: So those are the kind of the steps that I would take if I was a vertical SaaS company or if I was talking to one as you suggested.
• 20:24
  SPEAKER_01: Well, so no, one final question as we look ahead to Embedify 26, which is actually coming up in a few weeks, and FISERV is a sponsor, so thank you for that.
• 20:34
  SPEAKER_01: What is the one thing you want vertical SaaS leaders to understand about building a payments or a financial business inside their software platform?
• 20:43
  SPEAKER_00: I I think it's going to be table stakes, right?
• 20:45
  SPEAKER_00: I think you know the embedded payments angle has paid off immensely well for a lot of the vertical SaaS companies.
• 20:52
  SPEAKER_00: As you mentioned, 75 to 80 percent of those companies have embedded payments today.
• 20:57
  SPEAKER_00: This is the next step that they all need to take.
• 21:00
  SPEAKER_00: And if they don't take that over the next 12 to 18 months, they're gonna be seen more as a laggard in the industry than somebody that's keeping up with the times.
• 21:10
  SPEAKER_00: And I think the customers that they have today will start demanding it as well because they'll hear about competitive services that offer these types of capabilities.
• 21:20
  SPEAKER_01: Okay.
• 21:20
  SPEAKER_01: Well, Sunil, that's a great way to wrap up the show.
• 21:23
  SPEAKER_01: So I want to thank you for being here.
• 21:24
  SPEAKER_01: I know your time's very valuable.
• 21:25
  SPEAKER_01: So thank you so much for being on the show today.
• 21:27
  SPEAKER_00: Thank you so much, Greg.
• 21:28
  SPEAKER_00: I I really enjoyed it.
• 21:30
  SPEAKER_01: And to learn more about Embedify and to register to attend, visit Embedify2026.com.