4 Things Businesses Need to Know About Fintech
The term ‘Fintech’, applies to a very broad range of innovative solutions for the financial sector. Because this term is so broad, it doesn’t just impact financial businesses. All kinds of companies must make financial decisions, accept payments, and pay invoices. Since new and cutting-edge financial tools may impact the way that almost every company handles money, it’s important to consider the fintech essentials that could help a company like yours.
What Businesses Must Know About Fintech
Whether you operate within the restaurant industry or work in trucking, you will likely be in need of funding to start or grow your business at some point in time. Fortunately, fintech is geared towards helping these types of businesses, and all others, in the financial situations they face. Because of the way fintech solutions are capable of accessing various data points, they can look at all small business more objectively prior to making a financing decision.
So, how exactly can your company benefit from the disruptive innovation taking hold of the financial services industry? Check out these 4 simple ways in which your business could use FinTech solutions in its favor:
1. Take Payments from Anywhere
Companies like Stripe allow merchants to take credit card payments from their cell phones. This makes it easy for businesses to sell anywhere and at any time. The card reader works with both iOS and Android phones. Moreover, payment information can be uploaded into other software to make accounting, CRM, and other tasks much easier.
PayPal is another established company that offers merchants the ability to accept mobile payments through their mobile app. Any company that needs a flexible and affordable way to accept payments should consider some of these fintech payment processors.
2. Obtain Business Funding with Fewer Hassles
Online lending platforms offer easy access to business funding. These lenders accept online applications twenty-four hours a day and seven days a week. In addition, they can obtain the information they need to verify a business automatically, and they do not require an established business credit score. Business owners also appreciate rapid approvals and quick funding to their business accounts. Funding with these high-tech platforms offers a convenient experience, especially when compared to long applications and waiting periods at traditional financial institutions. For example, access to an online line of credit can help ensure that businesses can manage cash flow, take advantage of opportunities, and handle minor bumps in the road.
3. Pay Employees in a Better Way
There are new, exciting fintech solutions that help companies pay their employees in a better way. For example, in cases where employees may have waited for a long period of time to collect their earned payments because of the processing costs of writing checks. With new technology, some businesses find it easier to switch to semi-monthly or even weekly electronic payments. Most employees appreciate getting paid more often instead of having to wait for weeks for money that they already earned.
Another novel solution even lets employees draw against their earned wages before payday. If an employee has to visit the dentist or get a car fixed, this ability to get an advance on their own income can help them save money in credit card interest or payday loan fees. The benefit can help workers manage their financial lives better. At the same time, it costs their employers very little. Some employers may find that this benefit helps alleviates worker stress and also helps retain good workers.
4. Manage Business Cash Flow
If you ask the majority of small business owners about their most common concern, they will probably tell you that they think about managing cash flow just about every day. No matter how much money a company receives in revenues, that company will fail if expenses continue to exceed income. A recent American Express survey found that 27 percent of respondents admitted that their own company had experienced serious cash flow issues during the last three months.
Some fintech solutions like Wealthfront can help business owners and managers view the potential impact of different money management decisions. Other solutions, such as TrueAccord, ensure that companies collect money due on time by sending out automated invoices and scheduled reminders. Accounting software can interface with both payment and receivables systems to make sure it’s easy to know just how much cash a company has in reserve. Business owners and managers will probably always consider cash flow management one of their most critical issues, but fintech can make it easier.
Which Fintech Solutions Can Help Your Business?
No company wants to implement new technology just because it is new. However, if your company is wrestling with a problem in the way it receives payments, makes payments, or manages its finances, it’s good to know that there might be an innovative solution out there.
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Image: Tax Credits, CC 2.0
This article was written in collaboration with Kabbage.