Wallets, cards, and the flywheel effect: the formula for marketplace growth

Large, successful marketplaces all have one factor in common: momentum. In digital ecosystems, that momentum often comes from continuous interactions between users – especially when the same users participate as both buyers and sellers. The more buyers that join a thriving marketplace, the more attractive it becomes to sellers. More sellers bring greater product variety and availability, attracting even more buyers. This self-reinforcing loop is known as the flywheel effect, and it’s powering marketplace giants like Amazon, Uber, and Etsy.

The flywheel effect is a powerful growth model, but it isn’t infallible. It depends on more than just momentum – it needs the right systems to keep spinning. And that’s where many marketplaces hit a wall. While technology has made it easier for companies to scale, financial infrastructure often lags. Many platforms still rely on outdated financial systems that create unnecessary friction, especially regarding seller payouts. Slow, costly, or complicated payout processes can discourage sellers from reinvesting their earnings quickly, bringing the marketplace flywheel to a screeching halt. 

This is where embedded finance comes into play. By integrating financial tools like Wallets and Issuing directly into the platform, your marketplace can give sellers immediate access to their earnings and the ability to use those funds instantly – often to buy from other sellers. This keeps money moving within the ecosystem, boosts transaction velocity, and increases engagement across both sides of the marketplace.

Airwallex helps power this loop by enabling your marketplace to embed financial services into the platform, reducing friction and unlocking new ways for users to participate. The result? A flywheel that keeps spinning and a marketplace that scales. 

How traditional payouts break momentum 

If the marketplace flywheel is a machine, liquid cash is its lubricant. The more efficiently funds move within the platform, the faster growth compounds and the faster the flywheel spins. Yet, many traditional payout systems introduce disruptions. By sending sellers off-platform to access their earnings, these systems break the loop of reinvestment.

One industry study shows that US marketplace sellers wait an average of 3.3 days to receive their earnings.¹ These delays limit sellers’ ability to act quickly on reinvestment opportunities, including replenishing inventory, purchasing ads, or buying from other sellers on the platform. 

And sellers are taking notice. Visa found that 82% of marketplace sellers would sell more on platforms offering real-time payouts within 30 minutes.² More than two-thirds (68%) also said they’d be more likely to subscribe to a premium plan if faster payouts were available.²

Without timely reinvestment, marketplaces become less attractive to sellers and buyers. Listings shrink, inventory drops, and engagement slows, resulting in a negative feedback loop that stifles growth and limits your marketplace’s potential to scale.

Embedded finance is your marketplace’s growth lever 

Solving payout delays doesn’t just eliminate friction – it gives your marketplace a powerful advantage. When you embed API-based financial tools like multi-currency wallets and card issuing, you streamline payouts and keep funds in motion. Sellers gain faster access to their earnings and more ways to reinvest without leaving your platform.

This model is especially impactful when sellers purchase from other vendors within your ecosystem. With payouts and purchases happening in one place, money stays circulating, transaction velocity increases, and the user experience improves.

Beyond convenience, embedded finance unlocks powerful strategic advantages. Your marketplace can open up entirely new revenue streams by keeping more financial infrastructure in-house. For example, you can earn a margin on payment processing, collect interchange fees from platform-issued cards, or apply small markups on FX within wallets. Over time, these services turn from infrastructure overhead into monetization levers – all while fueling your marketplace flywheel.

Airwallex's embedded finance solutions

Airwallex provides embedded finance solutions built to strengthen marketplace infrastructure and accelerate growth. By keeping funds moving within the platform – through tools like multi-currency wallets, card issuing, and fast payouts – Airwallex helps marketplaces reduce financial friction, support seller reinvestment, and maintain a steady flow of capital across their ecosystem.

Key features of Airwallex’s offerings include:

• Wallets: Sellers can receive, store, and spend funds within the marketplace, reducing delays and enabling faster reinvestment. 

• Card issuing: Virtual and physical cards give sellers immediate access to earnings, improve cash flow, and support business operations without relying on external transfers.

• Multi-currency capabilities: Platforms can manage and move funds across borders more efficiently, lowering FX costs and supporting global sellers and buyers.

Together, these tools help marketplaces overcome liquidity barriers and keep capital circulating within your ecosystem, fueling seller activity, buyer engagement, and long-term platform growth.

Turning velocity into profit

A well-functioning flywheel keeps capital flowing and drives growth. Your marketplace can transform routine transactions into recurring revenue by directly embedding services like payments, card issuing, and FX into your platform.

As importantly, if your platform makes it easy for sellers to manage and reinvest their earnings, you’ll stand out in a crowded market. Faster access to funds, flexible spending options, and easy operations give marketplaces a clear edge, driving engagement, expanding GMV, and building a self-sustaining ecosystem made to scale.

Sources

1. https://www.pymnts.com/news/b2b-payments/2022/average-marketplace-seller-waits-3-days-to-get-paid/

2. https://corporate.visa.com/content/dam/VCOM/corporate/visa-direct/documents/visa-direct-marketplaces-report.pdf