What Are Embedded Payments? A Guide for US Businesses

Paying online used to be clunky. You would click “Buy,” get redirected, re-enter your details, and hope the checkout page looked trustworthy.

Embedded payments are meant to fix that. Instead of sending customers somewhere else to pay, payments are built directly into the app, website, or software they’re already using. Checkout feels like a natural part of the experience, not a separate step.

For US businesses, embedded payments can reduce abandoned checkouts, simplify payment operations, and open up new revenue opportunities for platforms and marketplaces.

We’ll walk through what embedded payments are, how they work, and when they’re worth using. We'll also discuss the Wise Business account. The global account that can help your company with all things cross-border.

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What are embedded payments?

Embedded payments are payments that happen directly inside a product or platform. Customers can complete a transaction without leaving the app, website, or software they’re already using.

Instead of being sent to a separate checkout page or third-party payment site, the payment experience is built into the product itself.

How embedded payments work in practice

With embedded payments, the entire flow stays in one place. That typically includes:

• Entering payment details
• Confirming the transaction
• Receiving a receipt or payment confirmation

From the customer’s perspective, paying feels like a natural step in using the product.

Embedded payments vs external checkout pages

Traditional online payments often redirect customers to a different site or payment window. That extra step can slow down checkout and increase drop-off.

Embedded payments remove that handoff. Customers stay inside the product, which helps reduce friction and keeps the experience consistent.

Embedded payments are most often used by:

• SaaS products that bill customers in-app
• Platforms that enable payments for users or sellers
• Marketplaces that handle transactions on behalf of multiple parties

In each case, payments are closely tied to the core product experience.

How embedded payments work

Embedded payments connect three main parts: the product customers are using, the payment infrastructure behind it, and the customer making the payment.

When these pieces work together well, paying feels simple, even though a lot is happening in the background.

The platform

The platform is where the payment experience lives. It controls how checkout looks, when customers are asked to pay, and how payments fit into the overall product.

You see this most often in SaaS tools and marketplaces that want payments to feel like a built-in feature rather than a separate step.

The payment infrastructure behind the scenes

Most platforms don’t process payments themselves. They typically rely on a payment infrastructure partner to handle the technical and regulatory work.

That partner typically manages:

• Connections to card networks and bank payment rails
• Moving money between financial institutions
• Security, fraud monitoring, and data protection

The payment infrastructure layer is especially important because it helps meet compliance requirements without having to build everything from scratch.

The customer experience

From the customer’s point of view, embedded payments are straightforward. They enter their payment details, confirm the transaction, and continue using the product.

Because there’s no redirect to an external checkout page, the payment feels like part of the same experience they were already in.

How money moves

Once a payment is approved, funds move from the customer’s bank or card issuer through the payments infrastructure and into the business’s account.

In platforms and marketplaces, payments may also be automatically split or routed to other parties, such as sellers, contractors, or service providers.

Where compliance and risk usually sit

Payments in the US come with responsibilities around data security, identity checks, and fraud prevention. In most embedded setups, much of that responsibility sits with the payment provider.

That responsibility often includes:¹

• PCI compliance
• Know Your Customer (KYC) checks
• Ongoing fraud and chargeback monitoring

Offloading these requirements helps platforms reduce risk and stay focused on their core product.

Why most businesses use a partner

Building an embedded payments system internally requires significant investment, ongoing maintenance, and constant attention to regulatory changes.

US businesses choose to work with an established payments provider because it’s faster, safer, and more cost-effective than managing the entire payments stack in-house.

Embedded payments vs integrated payments

Embedded payments and integrated payments are often used interchangeably, but they’re not the same thing. Both involve connecting payments to software, but they solve different problems.

Integrated payments focus on linking payment processing to existing systems, such as accounting tools, invoicing software, or point-of-sale systems. Embedded payments go a step further by making payments part of the product experience itself.

Here are some key differences at a glance:

Feature	Integrated payments	Embedded payments
User experience	Payments feel connected but separate	Payments feel native to the product
Checkout flow	May redirect to an external page or window	Stays entirely inside the platform
Branding	Often shows third-party branding	Fully platform-branded
Merchant onboarding	Separate sign-up for payments	Onboarding built into the product
Revenue potential	Limited or indirect	Can create direct payment revenue
Operational complexity	Lower upfront complexity	Higher setup, but more control

Integrated payments help systems talk to each other. Embedded payments reshape the customer checkout experience.

For businesses that want payments to feel invisible and fully aligned with their product, embedded payments are usually the better fit.

Benefits of embedded payments

As more commerce moves into software, payments are expected to follow. McKinsey & Company estimates that 30% of global economic activity will be mediated by platforms by 2025, raising expectations for seamless, in-product payments.²

Here are the main benefits of embedded payments for US businesses, from smoother checkout to better control over how payments fit into the product.

Smoother checkout and higher conversion rates

When payments happen inside a product, customers face fewer interruptions. There are no redirects, fewer pages to load, and less friction during checkout.

That smoother flow can reduce card abandonment and increase completed transactions, especially for mobile users and repeat customers. Even small improvements at checkout can have an outsized impact on conversion rates over time.

A better customer experience

Embedded payments feel familiar and consistent because they match the rest of the product experience. Customers aren’t asked to trust an unfamiliar payment page or re-enter information they’ve already shared.

Consistency for subscription services, platforms, and marketplaces can improve trust, reduce support issues, and make payments feel like a natural part of using the product.

New revenue opportunities for platforms

Embedded payments can become more than just a utility. By owning a greater share of the payment experience, platforms may earn revenue through transaction fees, payment services, or premium features tied to payments.

Payments can then turn into a recurring revenue stream rather than a cost passed entirely to third-party providers.

Simplified reconciliation and reporting

Because payments are built into the platform, transaction data is easier to track and organize. Payments, refunds, and fees can be linked directly to users, orders, or invoices inside the same system.

Reconciliation becomes simpler, and businesses reduce manual work and improve visibility into cash flow and payment performance.

More control over how payments fit into their product

Embedded payments give businesses more flexibility in how and when customers pay, with options like in-app billing, saved payment methods, subscriptions, or split payments in marketplaces.

Instead of designing the product around a payment provider’s limitations, businesses can design payments around how their customers actually use the product.

Challenges and considerations of embedded payments

Embedded payments offer clear benefits, but they also come with responsibilities. Figuring out these tradeoffs upfront can help avoid surprises as payments scale.

Compliance and regulation

Accepting payments means dealing with regulatory requirements, even when payments are embedded into a product. In the US, this often includes PCI compliance, identity verification requirements such as Know Your Customer (KYC), and data security standards.

Many businesses rely on a payments partner to handle much of this work, but the platform still carries responsibility for how payments are offered and monitored.

Fraud and chargeback risk

Whenever payments are involved, there is a risk of fraud and chargeback. Embedded payments can reduce some risk by keeping customers in a trusted, consistent environment, but they don’t eliminate it entirely.

Platforms need visibility into transactions, clear dispute processes, and tools to identify unusual activity, especially as volume grows.

Operational ownership

With embedded payments, businesses gain greater control over the payment experience. That can be a benefit, but it also means greater operational ownership.

Ownership can involve resolving payment issues, managing refunds, and answering customer billing questions. For some teams, this requires additional processes or support resources.

Partner lock-in and long-term flexibility

Most embedded payment setups rely on a long-term partnership with a payments provider. Switching providers later can be complex, especially once payments are deeply tied to product workflows.

Before committing, businesses should consider how flexible the solution is, how easy it would be to scale or adjust over time, and what options exist if their needs change.

When embedded payments make sense for US businesses

Embedded payments aren’t the right choice for every business. They tend to work best when payments are a frequent or central part of how a product is used.

Embedded payments often make sense when:

• Customers pay regularly, such as in subscription or usage-based models
• Payments are closely tied to the core product experience
• You operate a platform or marketplace that handles transactions for others
• Reducing checkout friction directly affects conversion or retention

In other cases, embedded payments may be less critical. If payments are occasional, low-volume, or already handled efficiently through a simple checkout flow, the added complexity may not be worth it.

The key is evaluating how important payments are to the product itself. When payments support how customers use the platform, embedding them can be a practical step forward.

Final thoughts

Embedded payments aren’t about chasing the latest payment trend. They’re about deciding how closely payments should be tied to your product.

In some cases, embedding payments can make checkout easier, reduce friction, and support growth over time. In others, keeping payments simple may be the better choice.

What matters most is how customers actually use your product and whether payments play a meaningful role in that experience.

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Sources:

1. Embedded payments licensing and compliance | Airwallex
2. Digital Ecosystems | McKinsey