6 Ways Fintech Has Revolutionized How Small Businesses Function

Image Credits: - Megan Rexazin/Pixabay.com

By Lily Tran

Technology that is now being used to augment and automate conventional financial services like transferring money, depositing checks, paying bills and applying for loans, buy and sell crypto currency is known as financial technology — fintech. Fintech has not only proved revolutionary for all and sundry but has proved highly beneficial for small business owners in these ways:

  • Fintech companies help with payment processing

Fintech helps small businesses receive and make payments on time by automating the payment process and making sure the payment gateway is secured.

Mobile payment processing solutions offer an easy plug-and-play option with tiny credit card readers that plug into a smartphone compared to the bulky point of sale machines.

  • Fintech can help with cash flow and supplier management

Whether your company has seen a decrease in revenue or not, cash flow management should always be a priority. Fintech companies can help small businesses with cash flow management by allowing struggling companies to pay for supplies later and also enable vendors to support small businesses by paying them in advance.

Fintech tools that help with cash flow management include SAP Ariba and Roger.ai.

  • Fintech has made access to additional financing for small businesses faster

If you own a business, you know how important it is to have good financial backing if you’re starting out. If you have great financial backers, you don’t need to worry about small or unexpected expenses that pop up, but you need to apply for a loan if you don’t.

Sometimes small businesses don’t qualify for business loans from traditional lenders like banks. Also, the process of getting a loan from a traditional lender is a long and tedious one.

Instead, fintech companies can provide a quick loan by simplifying the loan application processes and making sure that small businesses receive loan approvals faster than traditional bank loans.

There are several fintech equity funding options for small businesses like Crowdfunder, NetCapital and SeedInvest.

  • Fintech has helped automate the accounting process

Fintech accounting software will help you stay on top of your company’s finances without having the in-depth financial knowledge you need to manage your business’s accounts or without the aid of an accountant. Fintech Software like Sage Accounting, FreshBooks, QuickBooks Online, or Workday Financial Management will help you organise your invoices, payroll, expenses and handle financial forecasts.

  • Fintech can help improve financial data security

Cyber threats are a serious threat to the financial security of any organisation. One of the most dangerous ways cybercriminals can attack your business is by taking your financial data and your customers. Fintech companies like Feedzai, Similty, and Aspiration are helping businesses by making online and mobile transactions safer.

  • Fintech companies improve customer insights and engagement

Fintech companies that process payments can also provide insight into customer patterns and provide data about their spending habits and interests.

These insights are often combined with automated email campaigns and customer feedback requests on Facebook and can help small businesses plan their marketing and engagement techniques better.

Square helps with free customer engagement features that include private messaging with customers, a customer directory where merchants can view loyalty activity. Traditional payment systems don’t offer these features.

Fintech has helped small businesses overcome time-consuming bank processes, has made it easier for small companies to get loans, and has helped save on the high cost of essential financial services like accounting. Fintech’s revolution helps empower small business owners to run their businesses more efficiently and save them a lot of time and effort.

About the Author: –

LILY TRAN- Renowned Author and Content Writer-MONEYTAP.com

Lily Tran is a content writer, working for MoneyTap, who writes about all things Finance. Her passion for credit, debt, loan & investment drives her to help readers get an insight about everyday finance.

Copyright © 2021, Lily Tran-Content Writer and Author MoneyTap and Copyright © 2021 by International Business Magazine

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