FinTechs are Challenging the Autonomy of Banks

Banking CIO Outlook | Tuesday, December 04, 2018

Technology has changed the way enterprises conduct their business today. New and innovative technologies have outsmarted the traditional methods of doing business. The fintech services are the new system that has ended the monopoly of banks over financial matters. Fintechs are gradually finding its place among the more tech-savvy populace. A few years ago, the only way to get financial assistance for starting microbusiness was to approach banks. Fintech companies provide an alternative to the entrepreneurs for any financial assistance. Fintech companies offer options to start, run, or scale microbusiness. Written below is a brief description of how fintechs can help the small enterprises:

Digital Lending: The traditional process of loan approval is very hectic and time-consuming. The entrepreneurs, who open micro businesses, always face difficulties in availing a loan for starting, running or scaling their business. Micro or small businesses constitute a large part of a country’s economy and play a vital role in a country’s growth. Fintechs provide an online process, which eliminates all the inconveniences that the business owners have to endure. It helps to bridge the gap between banks and entrepreneurs. Fintechs helps to make the lending process a lot easier by providing an instant, paperless and convenient method.

Monitor expenses: small businesses don’t have an efficient system to monitor their expenditures. It is highly imperative that the businesses have an adequate accounting system to ensure a successful business venture. Many Fintech companies provide apps to monitor a company’s expenses. Business owners don’t need accounting knowledge to use these apps as these apps provide templates which makes it easy to use the app.

Business beyond Boundaries: before the introduction of fintech companies, credit card companies used to charge a hefty amount on any foreign funding, but now the fintech companies provide a cheap and hassle-free process of foreign investment. This has helped to conduct business overseas.

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