Leveraging platform thinking for service innovation in highly regulated industries: a perspective on the financial services sector

Digital platforms have become a dominant business model in the contemporary economy, yet their application in highly regulated sectors remains underexplored. This paper examines how platform thinking shapes service innovation trajectories in the European digital payments sector, drawing on a longitudinal analysis of 20 leading fintech unicorns over the past decade. The findings reveal three principal results. First, regulatory maturity acts as a structuring force that channels experimentation and eventually enables scaling once institutional arrangements stabilise. Second, platform thinking is operationalised differently across customer segments: business-to-consumer firms leverage platform configurations to redesign customer experience, whereas business-to-business firms deploy them to expand functionality and strengthen data-driven infrastructures. Third, the analysis identifies a four-stage process model — experimentation, development, enhancement, and expansion — through which firms progressively build platform-based service systems under evolving institutional conditions. The study contributes to platform strategy, service innovation, and regulated industry literatures, and suggests that managers should treat regulation as a design parameter rather than a barrier to innovation.