The global Banking as a Service (BaaS) market is projected to nearly triple by 2030, and nowhere is that growth moving faster than Asia Pacific, where the region is expanding at close to 30% annually, outpacing every other region in the world. At the heart of this growth is the increasing number of banks, cooperatives, fintechs, retailers, telecom companies, and other non-financial brands looking to launch financial products without taking on the cost and complexity of developing the underlying infrastructure themselves.
The BaaS model enables these players to leverage ready-made banking infrastructure through partnerships with providers, giving them access to capabilities such as accounts, payments, cards, lending, and compliance without having to build and maintain each component in-house. In this blog, we look at what is driving BaaS growth across APAC, why more players are turning to the model, and what to consider when choosing the right BaaS partner.
Key Drivers Behind BaaS Growth in APAC
Banking as a Service in APAC is being driven by broader changes in how consumers and businesses access financial services, along with the growing demand from both financial and non-financial players to deliver these services through new channels and customer experiences. Several key market shifts are contributing to this growing demand across the region include:
- Mobile-first financial experiences are becoming the norm
APAC’s highly connected, mobile-first consumer base is creating demand for financial services that can be accessed directly through digital channels. The World Bank reports that 86% of adults in East Asia and the Pacific own a smartphone, while 83% have a financial account, giving businesses a large digitally reachable customer base for mobile financial products. GSMA also reports that mobile internet connectivity reached 85% of the population in developed Asia Pacific and 50% in developing Asia Pacific in 2025. As more consumers manage money through smartphones, banks, fintechs, telecom operators, retailers, and other businesses need financial capabilities that can be embedded directly into mobile experiences rather than delivered only through traditional banking channels.
- Digital payments are becoming part of everyday commerce
The rapid adoption of digital payments across APAC is creating a broader ecosystem in which businesses increasingly need payment capabilities built directly into their products and customer journeys. According to a 2025 study, digital wallets are the leading online payment method in eight of the 14 APAC markets covered in its Global Payments Report. The shift is particularly visible in Southeast Asia, where more than 60% of payments are now digital, while three in five people shop online. As payments become an expected part of e-commerce, marketplaces, mobility, retail, and other digital experiences, BaaS gives non-bank businesses a way to integrate accounts, wallets, cards, payments, and related financial services without building the underlying infrastructure themselves.
- Financial inclusion is creating demand for new distribution models
Despite significant progress in financial inclusion, APAC still contains large and diverse populations with different levels of access to financial services. In South Asia, 82.9% of women and 84.8% of men had an account in 2024, while in East Asia and the Pacific the corresponding figures were 84.9% and 84.5%. This means the opportunity is increasingly about more than simply opening traditional bank accounts: providers need to make payments, savings, credit, insurance, and other services accessible through the digital platforms people already use. BaaS supports this shift by allowing financial institutions and non-financial businesses to distribute financial products through new channels and customer touchpoints.
- The region’s huge SME economy needs more accessible financial services
APAC’s vast SME base represents another major opportunity for embedded financial services. The Asian Development Bank estimates that MSMEs account for 99.8% of enterprises, 67.6% of employment, and 38.7% of national economic output across the 26 Asia-Pacific economies covered in its 2025 SME Monitor. Yet nearly half of MSMEs are unserved or underserved financially, creating an estimated $2.5 trillion credit gap. This creates demand for digital lending, business accounts, payments, working-capital solutions, and other financial products that can be delivered closer to where businesses operate. BaaS can help banks and fintechs make these services available through platforms, marketplaces, accounting systems, and other business ecosystems rather than relying solely on traditional financial distribution channels.
- Digital ecosystems are expanding the role of non-financial businesses
Financial services are increasingly becoming part of broader digital ecosystems rather than standalone products. Southeast Asia illustrates this shift: its digital economy is projected to reach $305 billion in GMV in 2025, with digital economy revenues reaching $135 billion, while the region has added more than 200 million internet users over the past decade. Platforms spanning e-commerce, mobility, travel, telecommunications, retail, and other sectors can use financial services to deepen customer relationships and create additional revenue streams. This is creating a need for banking capabilities that can be integrated into existing customer journeys. BaaS provides the infrastructure that allows these businesses to offer services such as payments, cards, accounts, lending, or other financial products without becoming banks themselves.
Where BaaS Is Reshaping Financial Services in APAC
The impact of BaaS is becoming visible across different parts of APAC’s financial ecosystem. Banks, cooperatives, fintechs, and non-financial businesses are using modular financial infrastructure to launch new products, modernize existing services, and reach customers through channels beyond traditional banking. Some of the clearest applications include:
- Digital lending and financial cooperatives
Financial cooperatives and lending institutions are using BaaS to digitize processes that have traditionally relied on branches, paperwork, and manual workflows. In Malaysia, Koperasi Tentera digitized its financing journey using modular, ready-to-deploy components to deliver a fully digital, Shariah-compliant lending experience. This approach allows established institutions to modernize how they serve members while building on their existing financial products, processes, and customer relationships.
- Digital wallets and payments
The growth of digital commerce and real-time payments is increasing the need for infrastructure that allows businesses to move money and deliver payment services seamlessly. BaaS enables banks, fintechs, and other businesses to integrate capabilities such as digital wallets, card issuance, account-to-account payments, and payment rails into their own platforms. Instead of developing each capability independently, businesses can connect to existing financial infrastructure and focus on the customer experience built around it.
- Neobanks and digital banking propositions
For neobanks and challenger financial brands, the BaaS model helps reduce the infrastructure burden involved in launching a digital banking proposition. A good example is Raqami Islamic Digital Bank, which leveraged Digibanc BaaS to launch one of Pakistan’s first Islamic digital banks, with capabilities spanning Islamic core banking, digital payments, onboarding, and account management. Leveraging ready-to-deploy banking infrastructure, digital banks are able to bring their propositions to market faster while having the flexibility to build and scale the services around their specific customer needs.
- Embedded finance for non-financial brands
BaaS is also expanding the role that non-financial businesses can play in financial services. Retailers, telecommunications companies, e-commerce platforms, marketplaces, and other digital businesses can integrate financial products directly into the experiences their customers already use. Lending at checkout, wallets within an e-commerce app, payment accounts for merchants, or financial services embedded into a telecom platform are examples of how banking capabilities can become part of a broader customer journey rather than a separate banking destination.
Why Banks and Fintechs Are Turning to BaaS
As we have seen, the BaaS model addresses several strategic business priorities that come first when deciding how to build, launch, and scale financial services. Its value is straightforward:
- Faster time to market: BaaS provides ready-made financial infrastructure that organizations can configure and deploy without building every capability from scratch. This helps shorten the time between developing a financial proposition and bringing it to market.
- Lower cost of ownership: Building and maintaining banking infrastructure requires significant investment in technology, specialist teams, integrations, and ongoing maintenance. BaaS reduces this infrastructure burden, allowing more resources to go towards products, customer experience, and growth.
- Flexibility to scale: Financial products and market requirements change as a business grows. A modular BaaS architecture makes it easier to add, modify, or expand capabilities without rebuilding the underlying infrastructure.
- Simpler market expansion: Markets differ in regulatory requirements, payment systems, and customer needs. The right BaaS infrastructure provides the capabilities and integrations needed to adapt financial propositions across markets without developing every component independently.
- Focus on differentiation: With the underlying financial infrastructure handled by a BaaS provider, teams can focus on what differentiates the proposition, such as product development, customer experience, market positioning, and growth.
What to Look for in a BaaS Partner
The partner you choose has a direct bearing on how effectively your financial proposition can be launched, scaled, and adapted over time. The decision should therefore go beyond the breadth of features on a product sheet and focus on whether the underlying platform can support your strategic objectives, operating model, and expansion plans.
From a technology and platform perspective, key considerations include:
- Composable, API-first architecture: The platform should provide modular capabilities that can be configured and orchestrated around specific business requirements without forcing the business into a fixed product architecture. This becomes critical as propositions evolve, new capabilities are introduced, and integrations expand.
- Multi-tenant, cloud-native infrastructure: The underlying architecture should support multiple products, markets, entities, and currencies without creating disproportionate infrastructure complexity. This provides the foundation for scaling the proposition while maintaining operational efficiency.
- Native compliance and Shariah-compliance capabilities: Compliance should be embedded within the platform architecture. This is particularly important across APAC, where regulatory regimes vary significantly and conventional and Islamic financial models operate alongside each other.
- A mature partner ecosystem: Evaluate the strength of the platform’s existing ecosystem across identity, KYC, AML, credit, payments, and other financial infrastructure. Established integrations can materially reduce implementation complexity and accelerate market entry.
- A platform that can evolve with your business model: The right BaaS partner should not only address the immediate use case but provide a path for what comes next – whether that means expanding into new products and markets, supporting multiple brands, or eventually providing financial infrastructure to third parties.
Final Thoughts
APAC’s Banking as a Service market is on a strong growth trajectory, and the fundamentals driving it are creating opportunities for players across the financial ecosystem to integrate financial services into the channels where their customers already engage. For banks, fintechs, cooperatives, digital businesses, and other brands, this creates an opportunity to extend their propositions, deepen customer relationships, and unlock new sources of value.
Integrating financial services, however, is not simply a matter of adding banking capabilities to an existing product. The underlying infrastructure needs to support the proposition, operating model, regulatory requirements, and growth ambitions behind it. The choice of BaaS partner therefore becomes a strategic decision, with implications for speed to market, scalability, cost, flexibility, and the ability to expand into new products and markets.
At Codebase Technologies, our Digibanc SaaS and BaaS platform gives conventional and Islamic financial institutions across APAC and beyond the composable, ready-to-deploy infrastructure they need to launch, modernize, and scale financial services faster without reinventing the wheel. Book a consultation with our team to explore how Digibanc can support your BaaS strategy and financial services roadmap.
Tagged:
- apac, digital banking, digital transformation, fintech
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Omar Mansur
Omar Mansur is the Global Enterprise Lead and Managing Director – APAC at Codebase Technologies and is widely regarded as a digital banking leader in MENA and APAC. Omar has devoted over 14 years to empowering MNCs and startups worldwide, supporting them on enterprise strategy, operational effectiveness, innovation strategies, and disruptive digital transformations.
He has expertise in banking, investments, fintech, payments, advisory, and Central Bank operations, applying his deeply strategic approach to driving industry and organizational innovation forward. Omar has amassed an extensive history of working with various Tier 1 and 2 financial, government, and fortune 500 institutions across the GCC, Africa, ASEAN, and South Asian regions, delivering game-changing and revolutionary digital financial initiatives.
