What is iPaaS (integration platform as a service)?

iPaaS emerged as a solution to the growing problem of application and data fragmentation in hybrid cloud and multi-cloud environments. Integrating on-premises applications, systems and data centers is becoming more challenging, especially as organizations rapidly expand their portfolio of software as a service solutions (SaaS sprawl).

SaaS applications are designed to be simple to set up, use and deploy. However, this accessibility also encourages teams to purchase SaaS apps to meet departmental needs, which can create an unwieldy ecosystem of cloud-based tools. Large enterprises (organizations with 10,000 employees or more) use on average 660 apps, according to a 2025 report from SaaS management company Zylo.

Before iPaaS, companies integrated applications and business processes through custom programming, enterprise middleware or enterprise application integration (EAI) implementations. For example, in service-oriented architectures (SOAs), an organization might use enterprise service buses (ESB)—centralized, middleware-based hubs—to facilitate and manage connections.

But these integration solutions can be expensive and difficult to build and maintain. They also leave companies susceptible to data silos (where one part of the organization doesn’t have visibility into another) and broader process inefficiencies, especially as the use of cloud apps, microservices, serverless, edge computing and Internet of Things (IoT) devices expands.

iPaaS cloud integration services provide a solution to the growing challenge of app, data source and service integration in increasingly complex IT environments. With iPaaS, enterprises can orchestrate integration flows and maximize interoperability between disparate systems by using tools such as pre-built connectors, maps and transformation components.

iPaaS services can help businesses build and maintain automated workflows, with real-time data synchronization that keeps data centralized and analytics up to date. No- and low-code tools, as well as user-friendly interfaces, help ensure that even citizen developers (non-IT employees) can build, scale and streamline integrations.

The iPaaS market grew by more than 23% in 2024, due in part to the proliferation of AI, no-code tools and SaaS, according to a 2025 Gartner analysis.

iPaaS solutions rely on several key integration features to share data across IT environments. Common components include:

Because iPaaS services are designed to accommodate different integration needs and IT architectures, there’s rarely a single iPaaS solution that works for every enterprise. Instead, leaders often assess their organization’s integration goals, including which apps, data stores, microservices and event streams they plan to connect.

After an organization chooses an appropriate iPaaS vendor, it can begin configuring and customizing its integrations. Initial setup varies based on the iPaaS solution that a team uses and the types of integrations it needs to build, but common steps include:

First, a team identifies two or more services that might benefit from integration. Next, it can use connectors and templates provided by the iPaaS platform to link these services.

For instance, a retailer might connect an ERP system, a customer relationship management (CRM) system and a cloud storage service. The organization might also link HR, payroll and finance systems to create a seamless employee onboarding experience.

After systems are connected, teams can begin building integration flows. Each flow defines a sequence of actions, such as extracting data from one system, transforming it and migrating it to another system. At this stage, users also specify the conversion, aggregation and enrichment processes that will govern how data is transformed and mapped between systems.

Teams can view dashboards, receive alerts and analyze data logs to help ensure optimal performance and to promptly diagnose and resolve issues. Moreover, many iPaaS solutions are designed to scale with the needs of organizations; the platform can be configured to deploy new resources as data volumes grow or new systems are added.

It’s often simpler and more cost-effective for organizations to use third-party, vendor-provided iPaaS connectors when possible. But when no integration solution exists, businesses can assign in-house IT departments to build custom integrations that work alongside existing iPaaS templates to accommodate specific business needs.

iPaaS, ESB and API management technologies all serve important enterprise integration functions. However, each approach varies in scope and complexity.

ESB is an architectural pattern that enables service integration through a centralized, bus-like middleware layer. This approach is often used to integrate apps in legacy systems and SOAs. Like iPaaS, ESBs can facilitate integrations between SaaS applications, but they’re often better suited for internal, on-premises applications, where security, governance and compliance are of primary concern.

Meanwhile, iPaaS is often ideal for modern, cloud-native systems, which prioritize scalability, flexibility and speed. ESBs and iPaaS solutions are often used together, with ESBs handling on-premises integrations and an iPaaS platform managing cloud-native integrations.

API management is the process of creating, publishing, documenting, governing and monitoring APIs. Its primary focus is managing and controlling access to APIs, enforcing standardized governance and optimizing API performance. This approach is most used by organizations that expose data and services to external consumers through API endpoints.

Because APIs play a critical role in modern IT environments, iPaaS platforms often include built-in API management and API integration tools. Modern API management components can accelerate digital transformation strategies by making APIs usable to agentic systems.

Because software agents increasingly rely on APIs to autonomously perform tasks, modern API management components might also feature advanced governance, security and optimization tools geared toward agentic consumers. Organizations might find it simpler to incorporate AI into their digital transformation strategies when their API management layer is already flexible, adaptable and well-governed.

Both iPaaS and platform as a service (PaaS) are cloud-based computing solutions, but they serve different purposes.

While iPaaS enables app, device and system integration, PaaS provides a platform for building, running and managing applications. PaaS includes runtime instances and operating system (OS) software, development tools (such as debuggers, version control mechanisms and code editors) and middleware (if necessary) to facilitate communication between OSs and applications.

For smaller, budget-limited and geographically diverse organizations, PaaS can often be more cost-effective than traditional, on-premises programming infrastructure, especially for complex production environments, which might be difficult to build and maintain in-house.

PaaS and iPaaS are often used in conjunction: PaaS provides an environment for organizations to create applications, while iPaaS helps teams integrate those applications, enabling data exchanges and automations.

While iPaaS and embedded iPaaS (EiPaaS) both support data and application integration, each solution targets different audiences and architectural layers. iPaaS is a stand-alone integration solution that enables organizations to monitor and manage each of their integrations through a centralized control plane. Internal teams build and maintain these integrations, uniting CRM, HR, finance and other systems to streamline business processes across the enterprise.

With EiPaaS, a SaaS vendor embeds integrations directly into its software product so that end users can configure integrations without leaving the app. Clients can seamlessly select from multiple vendor-hosted integrations, which connect the vendor’s software product to third-party applications and services.

For example, an ERP provider might enable clients to connect its platform to a third-party messaging app or a supply chain management service. EiPaaS solutions generally do not feature a centralized management hub because they are tied to specific software offerings, compared to iPaaS, which acts as an enterprise-wide integration platform.

Organizations traditionally used point-to-point integrations—where connectors are built and maintained manually for each integration in the network—to connect disparate systems. But this approach is difficult to manage and scale: Organizations must build new custom connectors each time a service is added to the system, and applications can become tightly coupled (highly reliant on each other), reducing reusability and interoperability.

Hub and spoke models are more advanced and provide a deeper level of customization and flexibility. They feature a central hub, such as an API gateway or ESB, which facilitates and manages integrations between disparate services. They enable services to remain loosely coupled, meaning they can be reused, adapted and updated without affecting connected apps, improving flexibility and agility.

Many modern iPaaS platforms incorporate hub and spoke architectures but add additional features, such as pre-built connectors and templates, low- and no-code development environments, built-in monitoring and lifecycle management tools and support for complex automations.

Another distinction is that, while legacy systems were primarily hosted on-premises, iPaaS is a cloud-native solution. This approach improves scalability (organizations pay for only the integrations they use and can quickly add or take away integrations as needed) and system flexibility (organizations can integrate apps regardless of the environment they are hosted in).

iPaaS solutions are designed to help developers simplify and accelerate the integration process across environments without extensive custom coding or infrastructure investment. Primary use cases include:

Implementing a cloud-native integration solution often requires extensive planning, especially in sprawling enterprise-level environments. Complexities notwithstanding, iPaaS platforms can accelerate and streamline business practices, helping citizen and professional developers alike harness their organization’s data and services. iPaaS benefits include:

iPaaS provides a single platform for all an enterprise’s data exchange and integration needs. Because cloud providers host and manage iPaaS platforms as a service, an enterprise can quickly subscribe, choose the tools and services it needs and get to work. The service provider handles provisioning, data governance, security, multi-tenancy, hardware maintenance and feature updates, leaving enterprise developers to focus on higher-level projects and innovations.

iPaaS services typically use a subscription-based pricing model, where users pay based on usage or number of integrations, making iPaaS more cost-effective and scalable than traditional integration solutions.

By presenting a centralized integration layer, iPaaS platforms help break down data siloes, connecting systems, applications and data sources that would otherwise remain disconnected. iPaaS solutions enable real-time synchronization between these sources, so that data changes are automatically distributed throughout the system.

This centralization helps IT teams maintain visibility over the network and enables analytics tools to gain an accurate, comprehensive and up-to-date view of system performance.

In traditional approaches, incompatibilities and inefficient data flows can lead to performance and analytical blind spots, unexpected downtime, server overload and security vulnerabilities. iPaaS helps address these problems by centralizing data management and offering built-in governance, optimization and compliance mechanisms.

With cloud computing, iPaaS can help reduce or eliminate the need for on-premises integration hardware, decreasing both capital expenditure and operational complexity. Organizations can seamlessly add or remove services to accommodate changing workloads and can rollout new features without disrupting existing data flows.

iPaaS also enables organizations to build workflows that incorporate applications and systems hosted across on-premises, hybrid cloud and multi-cloud architectures, improving agility. Because services in this model are loosely coupled, teams can reuse connectors for multiple purposes without custom code. Finally, real-time dashboards can help teams quickly respond to errors or incompatibilities.

iPaaS solutions can be used to create workflows to connect applications, streamline processes and automate repetitive tasks, so teams can spend more time on higher-value work.

iPaaS solutions can support both synchronous (real-time) and asynchronous (event-driven) data flows to accommodate different business needs. Synchronized data exchanges help teams make informed, up-to-date business decisions while at the same time reducing the risk of misalignments. For example, an e-commerce organization can use an iPaaS solution to automatically notify its inventory management software each time a customer makes a purchase. Meanwhile, the company can send non-urgent customer updates asynchronously, improving performance.

iPaaS solutions can streamline and automate workflows that would otherwise require intensive manual coding. With pre-built connectors and drag-and-drop interfaces, teams can bypass IT departments and quickly design their own integrations—or reuse already-existing integrations in new contexts.

iPaaS platforms use encryption, authentication and access controls to protect services from cyberthreats and prevent errors or security vulnerabilities from cascading through the system. Centralized management planes, meanwhile, enable teams to maintain oversight over system health and performance and enforce governance and compliance standards. Finally, dashboards and analytics tools can help organizations visualize and optimize data mappings and automations.

Aside from the benefits listed previously, modern iPaaS solutions offer additional tools that are specific to particular use cases or clients. Common features include:

iPaaS solutions enable teams to reuse and integrate previously siloed legacy applications, including services that rely on outdated data formats, instead of rebuilding older tools from scratch. This feature helps teams preserve critical data and maintain service uptime and stability for clients—even while modernizing systems behind the scenes.

While modern iPaaS platforms rely heavily on APIs to facilitate connections, they also provide robust API management features, such as versioning and security controls, so that organizations can manage API exposures and lifecycles from a single, unified platform. For example, an iPaaS solution can help improve API discovery, where teams are able to find, study and use APIs, often through a developer portal. iPaaS can also help teams monetize APIs by contributing to a sustainable, reliable API management strategy.

iPaaS can aid revenue operations (RevOps)—the process of analyzing and aligning teams around a shared set of revenue goals—by integrating sales, marketing, CRM, billing and related systems. iPaaS solutions can provide real-time data synchronization so that teams can make informed decisions regarding inventory, pricing and customer service. For example, an organization can allocate more resources to products that are in high demand while scaling back services that generate less revenue.

iPaaS can contribute to an organization’s data enrichment efforts, when developers increase the value of raw data by incorporating contextual or supplementary information from related systems. This method can also be applied to events: iPaaS can use data integrations to infuse events with useful context from other apps, such as historical information, risk scoring and journey IDs, before a team receives an event notification.

Some modern iPaaS solutions implement serverless architecture, where the platform vendor is responsible for maintaining server infrastructure, enabling autoscaling, variable pricing and other benefits. iPaaS can also integrate edge devices, which collect and process data near its source, and IoT devices, which use advanced sensors to collect metrics in real-time. Together, these systems can efficiently manage and route high volumes of data, helping teams convert data into valuable insights and optimize resources.