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The global FaaS market size is projected to grow from USD 310.5 billion in 2023 to USD 676.9 billion by 2028 at a Compound Annual Growth Rate (CAGR) of 16.9% during the forecast period. The expansion of the FaaS market is propelled by the increasing need for cloud computing technology enabling flexibility and scalability in operations.

Driving innovation of AI and Blockchain has also played a significant role in driving the adoption of FaaS as businesses strive to meet security requirements and protect sensitive data. Additionally, integrating FaaS into legacy or new systems through API is considered an emerging megatrend in the FaaS market. It enables seamless communication and interaction between FaaS solutions and end-user systems by providing a standardized way to exchange data and execute functions. Together, these factors form a powerful force behind the growth and advancement of the FaaS market.

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What is FaaS?

FaaS provides financial technology services and solutions through APIs and cloud-based platforms. It enables businesses to integrate and leverage various fintech functionalities within their applications or systems without building those capabilities from scratch. FaaS enables companies to access and utilize fintech services, such as payments processing, identity verification, risk assessment, lending, and more, as modular and scalable components.

Competitive overview:

The FaaS market is led by some of the globally established players, such as PayPal (US), Mastercard (US), Fiserv (US), Block (US), Rapyd (UK), Envestnet (US), Upstart (US), Solid Financial Technologies (US), FIS (US), Synctera (US). Partnerships, agreements, collaborations, acquisitions, and product developments are some of the various growth strategies by these players to increase their market presence.

PayPal (US) is a prominent, recognized digital payment platform that provides online payment solutions to individuals and businesses worldwide. The company's profitability is closely tied to its ability to attract and retain many users and merchants. The company operates through two major business segments: transaction revenues and revenues from other value-added services. PayPal offers FaaS solutions and payment processing services, allowing businesses to accept payments online or in person. PayPal Venmo is a mobile payment that enables users to make payments and transfer money directly from their mobile devices.

Mastercard (US) is one of the key providers of FaaS solutions that provides a wide range of payment solutions to businesses and consumers worldwide. Mastercard's business model is based on delivering secure, convenient, and reliable payment solutions that enable businesses and consumers to transact seamlessly across different platforms and channels. In the FaaS market, it offers Mastercard Smart Data, a comprehensive spend management tool that provides businesses a streamlined and efficient way to manage their expenses. Mastercard Payment Gateway is a secure and reliable platform enabling businesses to accept payments from customers across a wide range of channels and devices.

Mastercard also offers a range of value-added services to businesses, such as data analytics, loyalty programs, and business intelligence tools. These services help companies to optimize their operations, gain insights into customer behavior, and create more personalized and engaging customer experiences. The company has a large customer base across North America, Latin America, Europe, Asia Pacific, Middle East, and Africa.

Fiserv (US) offers a wide range of software, hardware, and professional services to banks, credit unions, investment firms, and other financial institutions. Fiserv's solutions are designed to help these institutions improve operational efficiency, reduce costs, and enhance customer experience. Fiserv operates in four primary segments: Payments, Acceptance, Fintech, and Corporate, among others. Fiserv offers a comprehensive suite of solutions for the FaaS market. This includes payment processing, digital banking, fraud detection, prevention, and data analytics solutions. Authhub by Fiserv is a multi-factor authentication solution designed to help financial institutions and other organizations enhance the security of their digital channels and protect their customers' sensitive data. Fiserv also offers a Payment card management solution called Cardhub. It is designed to help financial institutions and other organizations simplify and streamline their card management processes, improve operational efficiency, and enhance the customer experience.

Related Reports:

Fintech as a Service (FaaS) Market by Type (Banking, Payment, Insurance, Investment), Technology (AI, Blockchain, RPA, API), Application (Fraud Monitoring, KYC Verification, Compliance & Regulatory Support), End User & Region - Global Forecast to 2028

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