Insights

The journey toward the Digital Euro has begun, but banks still need clear answers regarding the opportunities and challenges of the new Central Bank Digital Currency (CBDC). For this reason, TAS has decided to meet with financial institutions to discuss how to integrate the new digital currency while mitigating investment impacts and creating value-added services.

“Technological evolution drives change in payment services: digital currencies have emerged, so moving toward the Digital Euro is a natural step,” says Odisseo Di Michele, Business Development Manager at TAS. “Moreover, those operating in crypto-assets today rely on private and high-risk networks that could easily collapse in the event of a speculative bubble. As a result, they are not viewed favorably by supervisory authorities, which must ensure stability, reliability, and resilience in payment systems within their respective markets. Having a Eurozone currency will also reduce dependence on major global digital payment networks, which have cost implications for the system’s resources.”

The First Challenges to Address

However, some critical issues also emerge for banks. The first concerns the cost of implementing new Digital Euro payment services, which must be included in budgets while also assessing the return on these investments.

“Another critical aspect is linked to the fact that digital currency is a form of payment similar to cash,” Di Michele continues. “The amount of digital currency citizens hold in their wallet is withdrawn from the current accounts linked to the Digital Euro app, thereby reducing the bank’s overall funding availability.”

How Many Digital Euros in the Wallet?

Discussions are ongoing between the ECB and banks regarding the maximum holding limit. The Central Bank is leaning toward a threshold of €3,000, while financial institutions would prefer a limit of €1,000.

“The main feature of these Digital Euro accounts (wallets) is that they must be funded via a link to one or more current accounts held by the customer, who can choose which account to draw from,” explains Di Michele. “However, the maximum cap — whether €3,000 or less — will be tied to the individual’s wallet, not to each associated account.”

The Path Paved by Instant Payments

While seeking a balanced solution between the two positions, the ECB recognizes that it cannot move forward without banks and the trust-based relationships they have built with consumers over the years, continuing to innovate in digital payments.

“The introduction of the Digital Euro, and more broadly services based on DLT technologies, confirms and consolidates the now unavoidable trend toward implementing instant payment services available 24/7/365,” Di Michele notes. “Another use case involves offline payments, similar to cash payments — anonymous and untraceable — activated through communication between two devices when there is no network connection.”

Strategies and Investments to Consider

To fully leverage the Digital Euro's innovative potential, banks may consider adopting shared system-wide platforms, upgrading their existing payment management platforms, or implementing new infrastructures dedicated to these new services.

“Our Payments Hub integrates all payment services, and thanks to an advanced technological platform, we will integrate Digital Euro payment services as well,” says Di Michele. “This is a journey that began with the introduction of instant payments last October and continues with the Digital Euro. This infrastructure enables the management of DLT-based mechanisms and new networks, starting with the management of the new Digital Euro account. The goal is to provide banks — and their end customers — with features to control and modify daily or monthly usage limits of the account linked to the wallet, as well as treasury management functionalities. In addition, we are developing solutions for the offline operation of devices connected to the Digital Euro wallet.”

Finally, TAS is working to facilitate the introduction of Digital Euro payment services within treasury management and the Public Administration sector, which will need to adapt to accepting payments in Digital Euro.

DLT for Eurosystem Payment Systems

In July 2025, the ECB approved a blockchain strategy structured around two projects: Pontes, a short-term solution to connect DLT platforms with the Eurosystem’s payment systems, and Appia, a long-term initiative aimed at creating an integrated European ecosystem for the settlement of tokenized assets.

This represents a response to dependence on foreign infrastructures and the spread of dollar-denominated stablecoins to strengthen European autonomy in digital payments.

“This strategy aligns with the evolution of settlement services provided by the ECB,” Di Michele concludes. “With the Pontes project, DLT-based services are being further expanded.”

Original source: article by AziendaBanca

September 29 | October 2 – Messe Frankfurt

TAS is among the official exhibitors at Sibos 2025.

Stop by our booth F065 to share insights on the latest trends on digital payments, liquidity management, payment schemes connectivity, open banking and much more.

20 - 21 June 2023 | THE IFEMA, MADRID

Advancing next generation payments - a quest for global interoperability

EBAday is coming back to Madrid this year, and we are excited to be among the sponsors of the event once again.

Embedded finance is revolutionizing the financial industry, and one of its most significant components is embedded insurance. But what exactly is embedded insurance? How does it work, and why should you care? In this article, we will explore the ins and outs of embedded insurance, from its definition to its benefits and use cases. Whether you're a fintech entrepreneur or a curious consumer, read on to discover how embedded insurance fits into the larger picture of open finance, PSD2, BaaS (Banking as a Service), and more.

What is embedded insurance

Embedded finance is a relatively new concept that refers to the integration of financial services into non-financial products or services. In other words, it means embedding financial functionalities within other applications and platforms, such as e-commerce websites, social media apps, or even cars. As a result, companies are able to offer their customers more convenient access to a range of financial products and services.

One of the most promising areas where embedded finance has been gaining traction is insurance.

Embedded insurance works by integrating insurance policies into products or services that are not primarily focused on providing insurance. This allows consumers to subscribe insurance policies directly through third-party platforms as part of their purchase journey on an e-commerce website or via their bank account without having to visit an insurer's website or office physically.

By integrating these two industries together we have facilitated better options for people who need financial security but don't want any hassle with extra paperwork and applications.

Embedded insurances are available across various industries such as travel, automotive, healthcare and more. For example, when purchasing travel tickets online, it may be possible for customers to add travel insurance coverage at checkout.

Benefits of Embedded Insurance

This innovation provides several advantages for both customers and insurers/business.

From customers’ point of view one of the key benefits is convenience. With traditional insurance, customers have to go through a lengthy process of signing up for policies, submitting claims, and waiting for reimbursements. Embedded insurance simplifies this process by integrating it into existing products and services. Customers can buy an insurance policy with just a few clicks on their digital devices instead of filling out lengthy forms and waiting for approval. This means fewer steps for customers, leading to an increase in conversion rates.

Another benefit is cost-effectiveness. Because embedded insurance is integrated into other products and services, it does not require separate marketing efforts or distribution channels. This can result in lower costs for both insurers and customers and a better customer loyalty. By offering embedded insurance, companies can provide added value to their customers without requiring them to seek out third-party providers. This makes it more likely that they will continue using the company’s products or services in the future.

Embedded insurance creates a more seamless customer experience by providing a one-stop-shop for all financial needs. Customers can manage their finances and protect themselves at the same time, making it easier for them to stay on top of their finances. For example, when purchasing a car or booking travel online, customers can easily add on relevant insurance coverage without having to navigate through separate websites or applications.

For insurers, embedded insurance opens up new revenue streams by tapping into previously untapped customer bases that may have never considered purchasing standalone policies before. Moreover, integrated data analytics mean that companies can collect more information about their clients' behavior patterns to offer personalized coverage options.

Businesses benefit from embedded insurance by being able to offer additional value-add services that differentiate them from competitors. By offering embedded insurance products or partnering with insurers who do so, companies can improve customer loyalty while increasing revenue streams.

In short, the benefits of embedded insurance extend far beyond convenience - it provides better user experiences; increases customer satisfaction; drives new revenue streams for businesses while reducing exposure risks.

The key aspect of embedded insurance is to anticipate customer needs at the right time by shortening the traditional steps of the customer journey. In this way, we move from a planned purchase model to an impulse one in which consumers do not research and compare the different options available on the market: the goal is to acquire customers before the main transaction (i.e. purchase of a flight ticket) is completed.

Embedded insurance is shaping the future of finance positively. As more industries embrace open finance concepts like BaaS (Banking as a Service), we can expect these integrations to become even more prevalent in our daily lives soon.

Problems and Opportunities related to Embedded Insurance

As with any emerging technology or trend, embedded insurance comes with both challenges and opportunities.

One of the main problems is regulatory compliance. As embedded insurance operates within the framework of PSD2, businesses must navigate a complex set of regulations to ensure they are compliant. This can be time-consuming and costly.

Another problem is customer awareness. Many consumers may not understand what embedded insurance is or how it works, which could make them hesitant to use it. Businesses need to educate their customers about the benefits of this type of insurance so that they feel confident in using it.

However, as with any challenge, there are also opportunities for growth and innovation. With the rise of Baas (Banking-as-a-Service) platforms and Open Finance initiatives, businesses have more access than ever before to integrate new financial services into their products such as loans or payments while offering comprehensive protection through embedding an insurance product like travel medical coverage right where users need it most – during a transaction itself.

Furthermore, through utilizing data analytics technologies combined with IoT devices installed in cars or homes for example, insurers can offer personalized policies based on individual needs instead of blanket coverage plans – thus creating a competitive advantage over traditional insurers who rely solely on manual underwriting processes.

Navigating these challenges will ultimately lead to new innovations that bring greater value to both businesses and consumers alike in today's fast-paced digital world.

Use cases of Embedded Insurance

The rise of embedded insurance has opened doors to various use cases across industries, providing businesses with innovative ways to monetize and enhance their offerings. One such example is within the travel sector, where booking platforms can now seamlessly offer tailored travel insurance products alongside flight or hotel reservations. Airlines offer travelers coverage for flight delays, cancellations, lost luggage, and other related incidents through an add-on feature during booking or check-in processes, without any additional steps required from you as a customer. By integrating these services directly into the customer journey, clients benefit from a more streamlined experience while companies tap into new revenue streams through commissions earned from selling these integrated policies.

In addition to travel, the automotive industry stands to gain significantly from embedded insurance solutions. As car manufacturers increasingly incorporate advanced technology in their vehicles, offering customized auto insurance policies based on data collected by sensors could provide accurate risk assessment and pricing for customers. This personalized approach offers potential savings for responsible drivers while encouraging safer driving habits overall.

Similarly, within the realm of e-commerce and retail, embedding warranty or protection plans during product checkout can lead to increased conversion rates and added value for customers seeking peace of mind when making purchases online. By simplifying this process through seamless integration with existing point-of-sale systems, merchants create an opportunity for upselling without disrupting the customer experience.

Emerging digital health platforms have shown great promise in leveraging embedded insurance as a way to expand access to healthcare coverage among users globally. With telemedicine growing rapidly worldwide due in part to recent global events – there lies vast potential in offering relevant medical malpractice or cyber liability coverage options directly within these digital platforms themselves.

It's evident that industries as diverse as finance (BaaS), transportation (PSD2) and healthcare are all incorporating embedded finance—particularly open finance—to maximize opportunities offered by innovations like PSD2 towards delivering greater value-add propositions around essential services such as banking-as-a-service (BaaS) and beyond.

Embedding insurance offers an array of practical applications that companies can integrate into their business models seamlessly. By doing so they provide more value-added services to customers while also reducing administrative overheads associated with traditional insurances schemes.

Conclusion

Embedded insurance is a game-changer for both the insurance and financial industries. It has the potential to revolutionize how people access and use different financial services while providing more convenience, cost-effectiveness, and personalized experiences.

With PSD2 and BaaS opening up opportunities for new entrants in the market, embedded finance will continue to be an exciting area of growth. And as embedded insurance becomes increasingly popular among consumers, we can expect more partnerships between banks, insurers, fintechs, retailers and other players in the ecosystem that offers various services under one roof.

While there are still challenges that need to be addressed such as data privacy issues or regulatory barriers when it comes to offering cross-border solutions. The future looks bright for this emerging trend with many companies exploring ways they can leverage their existing platforms to offer embedded insurance products.

As technology continues evolving rapidly within both industries – we can only imagine where this innovation may take us next.

TAS Global Payment Platform for the Embedded Finance

Several financial institutions choose the TAS Global Payment Platform (GPP) to provide a better payment experience and enable faster time-to-market. The GPP platform is suited to any ecosystem operator between banks, technology providers, and distributors of financial products to guarantee a great and seamless customer experience. We work with businesses in digital banking, BNPL, insurance, travel and payments thanks to a highly configurable platform with open APIs.

Our embedded finance offering comes with scalable and reliable micro-services, flexible workflow configurations and a centralized custom overview that permits companies higher dynamicity.

Contact us to discover how we can help you leverage embedded finance for your use case

Fintech user experience, bank specialization. To stay competitive in the open finance ecosystem, banks need to replicate the user experience of fintechs - simple and catered to customers' individual needs. Therefore, their strategy should focus on specialization, as well as a on streamlined, personalized offer. According to Matteo Bravi, Chief Strategy & Transformation Officer at TAS, « Banks must upgrade their front-end services to deploy those attractive features designed for different customer types that have proven to be successful with fintech. This requires making the most out of available customer data and becoming a partner in customers’ daily decisions and long-term plans by customizing services and expanding offerings beyond traditional banking or insurance domains».

The new customer clusters

Rethinking front ends means keeping in mind that digital channels don't only belong to the youngest group. In fact, if one looks at profitability, internet and mobile banking must target the most profitable segments such as silver, as well as niche markets with high added value that require specialization. As Bravi explains, «The wealthiest market is composed of seniors, professionals, corporates and small businesses. These markets remain untapped and fintechs, without a banking license, cannot provide loans or salary-backed loans as a financial institution can. They may take away a portion of the market by acting as an Electronic Money Institution (EMI) but they do not have the same opportunities of finance».

The generic offer loses value

Some banks are now concentrating on specific industries in order to create tailored solutions. As an example for tourism, this could include single-use prepaid cards as an alternative to bank transfers for paying travel agencies. The insurance sector has seen the introduction of four-handed bank-insurance agreements linking insurance premiums with credit cards. Today generic payment cards are no longer successful, so it is necessary to find a reason for them to exist – comments Bravi, and offer a personalized service based on a specialized area such as seniors or SMEs.

Personalization: the advantage of data

Specializing in a niche market alone is not enough. In order to compete in the open finance world, banks must also focus on offering personalized and rapid services. Taking advantage of AISP licenses will allow banks to provide account aggregation to customers for a convenient experience; by having all of their financial data in one location, users can more easily manage their accounts and make payments. This feature may be most beneficial to the bank as they gain a better understanding of the customer’s assets and buying behavior that they can then use to better identify impulse purchases. An example would be instant insurance; when an account holder uses their card at the bank’s checkout, the app sends out a notification suggesting the purchase of quick travel cover – adds Bravi. It is true that these are products with a fair margin, but if tailored and integrated with other profitable services, they can certainly increase the perceived value by customers.

Be quick, even in IT

The path towards open finance is clear - the customer should be a top priority in any business strategy. To succeed, banks must specialize in market segments and niches, while using data to create tailored offers. Technology is an essential element in this competitive market, leveraging investments made over the years. « In order to revolutionize user experience as fintechs have done, banks must integrate their existing systems with new technologies. The important thing is to make these systems flexible enough to allow quick innovation» Bravi explains. Every bank has its own unique IT infrastructure, and that's why it is important for us to find specific solutions to meet their needs while maintaining pre-existing systems, and working on the back and front end with tailor-made proposals».

Author: AziendaBanca by G.C "TAS. La specializzazione è la chiave dell'Open Finance"

English Translation by TAS

10 - 13 October | RAI, Amsterdam

Sibos is back in-person and TAS is again among the official exhibitors. We can’t wait to meet you in Amsterdam  where SWIFT will host a full conference programme and exhibition, along with a wide range of networking events. The agenda will feature business leaders and topic experts from across the financial community and beyond, discussing the most impactful trends in technology, regulation, risks and sustainability. If you can’t make it in person, join Sibos virtually by connecting to the digital conference experience that will extend Sibos to delegates around the world.

Stop by our booth D76 to share insights on the latest trends on digital payments, liquidity management, payment schemes connectivity, open banking and much more.

TAS conducted a survey, in partnership with Bobsguide, to learn how PSPs, including Credit Institutions and other Payment organisations around the world, are reacting to the changes and challenges in today’s emerging payments landscape.

The report highlights the themes having a big impact on the payments industry right now: instant payments, ISO 20022, and liquidity management, and contains insights into global technology investment strategies, cloud adoption trends, the main challenges currently seen by the payments community and more.

Download Report

In this video Marco Pozzo, Senior Business Development Global Payments of TAS Group, shares his point of view regarding the changing scenarios and the arising challenges in the Open Banking era…

Retail payments have historically belonged to one of two distinct groups: those that are card-based…