Navigating Financial Fluctuations with Flexible Solutions

Much like the unpredictable British weather, financial outlays and savings ebb and flow throughout the year. For some, this means preparing for periods of higher spending, such as summer holidays, while also navigating tighter budgets in the early months of the year, often stretched thin following the festive season.

Today, modern consumers seek innovative financial services that can match their growing expectations and provide the flexibility needed to keep up with their changing spending habits.

Recent research reveals that 66% of British adults intend to boost their savings and make significant purchases in 2025. To meet these evolving demands, financial technology companies need to step up with an array of creative payment solutions that can empower consumers to make financial decisions that align with their habits and lifestyles.

Data-driven rainy day saving (and spending)

Innovative financial products, such as open banking, are propelling individuals and businesses to financial success. By leveraging the personalised insights provided by open banking, consumers can optimise bill payments and investments, aligning their financial activities with personal goals. This data-driven approach is particularly appealing to Gen Z, who typically value experiences over material possessions and often seek financial products that provide rewards or offers on activities.

Digital payment tools are another option, which grant people greater oversight of their day-to-day, monthly and yearly spending habits. The ability to access granular insights into spending and saving can provide people with a solid foundation to help them reach their spending goals.

Save Now, Buy Later (SNBL) schemes encourage people to save for big-ticket items before purchasing. They promote financial responsibility by helping consumers focus on putting aside money during periods of low expense to support bigger purchases or spontaneous spending when the sun is shining.

Building on the foundation of embedded finance

The rise of embedded finance, which seamlessly integrates financial services into non-financial platforms, is changing the way businesses and consumers interact with financial services. This approach is becoming a preferred option for consumers looking to achieve financial stability and maximise value when spending at their preferred brands through tailored rewards programmes and flexible tools that better meet their needs.

The rise in consumer demand for cutting-edge financial services solutions and embedded finance products is evidenced by the rise in traditional financial service companies announcing partnerships with fintech players to provide a competitive service better suited to the current climate.

Visa’s Flexible Credential partnership with Marqeta and Affirm and Mastercard One Credential are prime examples of traditional financial services partnering with fintechs to develop innovative embedded payment options. Flexible credentials allow consumers to choose whether to pay with BNPL, debit or credit at checkout, and signify a move towards offering embedded financial products as consumers demand optionality and seamless access to tailored financial services.

Buy Now, Pay Later delivers financial flexibility

Today’s consumers are looking for greater flexibility and convenience in how and when they pay for everything from concert tickets to the latest clothing trend, and retailers are aware of this. As a result, more are beginning to offer flexible payment options like Buy Now, Pay Later (BNPL) to help break purchases into manageable instalments and align with the digital-first, budget-conscious approach of many of today’s consumers.

A greater demand for BNPL services is reflected in the progress and considerable rise of providers in the UK. The recent success of Klarna (growing its BNPL business and filing for an IPO) and the launch of US-headquartered Affirm in the UK (its first market outside in North America) points to a thriving and effervescent environment for groundbreaking financial services in the UK.

Marqeta is a key player in this shift. As a card issuer and payment processor, Marqeta is empowering businesses to create and manage customised payment solutions that provide greater flexibility and control for consumers and businesses. Slope, a credit and financing platform for businesses, recently enlisted Marqeta to power its new Slope Card in the US, a BNPL solution for commercial use-cases that gives businesses easier access to capital and streamlines expenses.

Benefits of Accelerated Wage Access

Accelerated wage access (AWA) is another tool individuals or businesses can use to better plan their expenditures or savings. It is gaining traction in the gig economy by providing instant access to earnings, which helps workers overcome cash flow challenges and meet financial needs without relying on traditional pay cycles. This can give them financial flexibility and economic emancipation.

Digital wallets and contactless payments are becoming increasingly prevalent, with all signs pointing to a drop-off in the use of traditional payment methods like cash. This is evidenced by a recent Marqeta study that found consumers are now more likely to leave their physical wallets at home. Digital wallet innovations now allow customers and businesses to track daily spending and set spending limits. Cards also offer another layer of security that cash does not, through features such as tokenised payments.

Flexible financial journeys

Embedded finance introduces greater flexibility into people’s financial management throughout the year. Businesses, including retailers, are adapting to these changes by offering flexible payment options, such as BNPL services, to cater to the digital-first, budget-conscious consumer base. This trend aligns with the broader movement towards financial products that offer convenience and align with individual spending habits and empower customers to better manage their finances.

As a result, the integration of digital tools and embedded finance is set to play a crucial role in helping UK consumers successfully navigate their financial journeys this year.

Whether it’s flexible payment options, personalised financial insights, or tools like AWA, the current wave of fintech solutions is empowering people to manage their finances effectively. As these trends continue to evolve, consumers will be better equipped to navigate the challenges and opportunities of the year ahead.