A little over two decades ago, you had to enter your business transactions in a physical ledger. Then, you had to add all of these transactions up, which could take a long time, and usually have errors.
Getting a loan was another ordeal in itself. You’d have to spend days compiling documentation, and you still wouldn’t be sure if your loan would be approved after months of waiting. Now, FinTech has made it extremely easy to do a lot of these things in a reliable, secure, and fast way.
In this article, let’s explore how small businesses can benefit from FinTech.
How to Start a Small Business?
Ways Fintech Can Benefit Small Businesses
Streamlined Payment Processing
What is FinTech?
As the name suggests, FinTech is a combination of two words: Financial (Fin) and Technology (Tech). We already use FinTech in our daily lives. Whether it’s mobile banking, payment systems like Venmo, or even trading platforms like Robinhood.
This helps streamline transactions for users. Think about this, when was the last time you went to your bank to make a payment? Nowadays, we can just pull out our phone and make a payment as easy as 1-2-3.
Because of FinTech, not only are multinational businesses like Amazon, eBay, and Shopify thriving but also smaller businesses that use the tech to streamline their payment systems.
If you’re a small business owner, using FinTech is one of the best ways to process payments faster.
How to Start a Small Business?
As a small business owner, especially someone who also operates online, having a streamlined system is crucial. Not only do you need a website or mobile app that works, but also one that’s fast and reliable. Besides this, you also need a payment processing system and a reliable internet connection to keep things afloat.
If you’re just starting with your small business. I recommend creating a business roadmap where you outline your goals, objectives, and target market. Once you know what you’re doing, start building your website – one that reflects your niche.
You can use platforms like Shopify, Wix, or Squarespace, which can be a bit more expensive, but easy to manage. Or you can self-host your website. If you do so, I recommend looking up ‘internet in my area’ on Google, and choosing a provider that’s reliable, so you can always be available for your customers.
Once you have everything set up, launch your business and design digital marketing strategies to attract new customers and scale your business.
For online payments, you can use one of the several platforms out there like Stripe, PayPal, BlueSnap, or Square. Let’s take a look at how using FinTech payment platforms can benefit your business.
Ways Fintech Can Benefit Small Businesses
Let’s look at some of the ways small businesses can rely on FinTech for their finances:
· Streamlined Payment Processing
Traditional payments rely on manual processing, checks, and cash, which can be time-consuming and prone to errors. This can cause delays, theft, fraud, and even higher costs.
However, FinTech offers a streamlined payment solution that can help simplify and even automate online payments in a secure way. It can help you save costs, enhance security, and improve customer experience.
Through automation and bank feeds, you can update your books in real-time. With this updated information, business owners can see trends in data and improve their business before it starts going into a loss.
· Multiple Payment Solutions
As a business owner, you need a reliable payment solution your customers can use. A good payment provider will help your customers use the payment method they want, such as:
- Mobile Payments
- Online Payment
- Peer-to-Peer Transactions
- Point-of-Sale System
- Cryptocurrencies
- Invoices
- Digital Wallets
By integrating these solutions into your business operations, you can enhance payment processing, which can improve efficiency and provide customers with a seamless experience.
· Access to Funding
As a small business owner, you typically don’t have access to unlimited money. Traditionally, you’ll need to obtain a loan from an institution like a credit union or a bank, which requires paperwork like financial statements, business plans, and documentation that proves credibility.
On the other hand, FinTech has allowed alternate lending models to exist. These are more flexible, efficient, and accessible compared to the traditional systems that have existed for decades. This allows businesses with smaller credit histories to access capital more easily.
· Accounting and Bookkeeping
Using a digital solution for bookkeeping can help business owners sort out their financial documentation. Having access to organized and accurate financial records is crucial for making an informed decision, ensuring compliance, and monitoring cash flow.
You can record financial transitions like expenses, sales, and payrolls while analyzing the financial data to see how your business is doing. By doing this, you will make an informed decision which will help you sustain your business in the long term.
Overall, FinTech is quickly becoming the all-in-one finance resource for large as well as small businesses. Digital payment applications can help you provide your customers with a seamless experience. FinTech is removing a lot of the friction between customers and businesses, giving business owners the bandwidth and time to help their customers and scale their businesses.
