Business Banking in Germany is Changing: Here’s What You Need To Know

Business banking in Germany is changing. And it’s shifting to embedded finance. From engaging with customers, partners, and the wider ecosystem, conversations kept circling back to a core idea: the most successful financial experiences are no longer found in banks. They’re happening inside the products people already use every day.

Germany, traditionally a stronghold of conservative banking, is experiencing a major shift. The fintech ecosystem here is growing fast, with startups and incumbents alike rethinking how financial services should work. And embedded banking? It’s the missing piece that’s turning good software into indispensable financial platforms.

A shift from financial access to financial action

For years, the fintech revolution in Germany has focused on one thing: access. Open banking, real-time payments, and digital-first financial services have made it easier than ever for businesses and consumers to connect with financial tools. But access alone isn’t enough.

The real opportunity now is action—turning financial interactions into seamless, intelligent workflows. Businesses don’t just want to see their bank balances; they want their financial software to act on that information. Automate payments. Manage cash flow. Predict liquidity needs. And do it all without forcing users to switch between multiple platforms.

That’s where embedded banking changes the game. By integrating banking services directly into SaaS products, companies can remove friction, unlock new revenue streams, and build stickier, more valuable products. And with 79% of banks predicting that banking will be deeply embedded in everyday commercial activities, the most forward-thinking software companies in Germany are already moving in this direction. As Florian Thiel, Swan’s Head of DACH, shares;

“Germany’s financial landscape is evolving fast, and businesses now want intelligent, automated financial workflows that live inside the platforms they already use. Embedded banking is the natural next step.”

Why now is the time for embedded banking in Germany

While other European markets have embraced embedded finance, Germany’s highly bank-centric ecosystem has historically made adoption slower. But that’s changing fast. Several factors are accelerating this shift:

1. The PSD2 pain point

Open banking promised seamless financial data sharing, but in Germany, PSD2—a regulation that allows third-party providers to access bank data with customer consent— enforces strict reauthorization requirements that have made the experience frustrating for businesses and their clients. Embedded banking bypasses this by letting financial software providers offer banking services directly within their products, with no more clunky connections to external banks.

“PSD2 was meant to open doors, but in practice, it’s slowed things down—especially in Germany. With embedded banking, you sidestep the friction entirely and meet rising expectations for security, speed, and seamless access. Combine this with the coming wave of European digital identity and AML regulation, and the case for embedded banking becomes even stronger.”

2. The B2B opportunity

Consumer fintech has received most of the attention over the past decade, but now, the spotlight is firmly on B2B.  According to McKinsey, the delivery of financial products by non-financial companies within their broader offerings could surpass €100 billion in Europe by the end of the decade. Accounting platforms, expense software, treasury management—these tools are now the beating heart of embedded finance. And Germany, with its vast market of small and medium-sized businesses, is perfectly positioned to lead in this space.

“The next decade of fintech won’t be driven by neobanks—it’ll be led by B2B platforms embedding financial services so natively that users won’t even realise there’s a financial institution behind it. Vertical SaaS is where this transformation is taking root, especially in Germany’s deep SMB ecosystem.”

3. A technology-first approach

The next wave of financial innovation in Germany won’t be led by banks alone. It will be driven by software companies embedding banking features at the core of their products. In fact, non-bank financial intermediaries hold 49% of financial assets. This has been one of the most exciting evolutions over recent years—seeing SaaS companies recognize that adding banking features isn’t just a nice-to-have, but a lever for strategic growth.

“We’re watching traditional banking get rewritten by software. The most innovative companies in Germany aren’t just adding financial features—they’re baking them into the core of their products. It’s a technology-first mindset, and it’s setting a new standard for how business finance works.”

So, what’s next?

Germany’s fintech market is at an inflection point. The companies that will define the next decade won’t just be offering financial services—they’ll be embedding them where they make the most sense, inside the products that businesses already use.

For software companies, the question is no longer should you add banking features, but how quickly you can move? Whether it’s enabling instant supplier payments inside an ERP, helping CFOs manage liquidity in real-time, or letting businesses issue their own payment cards, embedded banking is turning software into something far more powerful: true financial platforms with built-in banking infrastructure.

From what we’ve seen, Germany is fast accelerating towards the new reality of banking that doesn’t have to live in a separate app, a different tab, or a clunky interface. The future of finance isn’t somewhere else. It’s right here, inside existing business tools.

And the companies that understand this shift will be the ones shaping Germany’s exciting financial future.

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