• Exploring the potential of Fintech – Five Opportunities that can modify the financial industry

    Date: 2019.05.22 | Category: business | Tags: ,

    We all use Fintech daily without realizing it. Right from paying for a muffin from our Smartphone to managing complex financial data at office, Fintech is always in use. The exponential expansion of technology has brought about several changes in all ways of life. There have been some fundamental financial transformations as well.

    What is Fintech?

    Simply put, Fintech can be defined as a set of tactics for applying advanced technology to finance and financial services. The conventional financial institutions make use of it primarily for managing back-office and other accounting solutions. In recent times, owing to the enterprising start-up business set-ups, the Fintech applications are modifying the secure financial solutions. Also, it poses a challenge for all the institutions that had adopted this process initially.

    Billions got invested in the international business domain in the past five years. And Fintech happens to be one of the popular technology domains. Global players like PayPal and other start-ups today are re-engineering the financial industry in their way. There is much happening in the area of debt settlement domain as well. You can read more on the debt settlement reviews to learn more.

    However, coming back to the Fintech market, it is not saturated as many think it to be. One of the best industry trends comprises of payments and lending. And still, more scopes can be explored. Discussed below are five areas of Fintech scopes that entrepreneurs and successful businesses can leverage.

    1. Financial inclusion and mobile banking for the underserved

    Do you undermine the prospects of mobile? If yes, you need to take a look at the international crowdfunding campaigns. Today, many companies specialize in mobile-first banking. One of the leading names here is Monzo. Other companies specialize in mobile banking tools for immigrants and expats. These companies provide expats and immigrants with all the essential banking services, irrespective of their credit history and address. The overall transaction value for these companies is increasing exponentially and holds the promise for future expansion as well.

    Hence, it suggests that this can present an enormous scope for mobile banking companies. Also, there are ample opportunities if you want to cater to the underbanked population. According to DeNovo, a strategy consulting platform of PwC, today, about 42% of the international adult population isn’t present in the formal financial system. Hence, even the modest attempts at attaining economic inclusion can allow you to leverage Fintech.

    1. Simplified personal finance management

    With Fintech development, there’s no need for a formal degree in business or finance for managing accounts. You can have access to the best tools in the market that provides automatic finance planning, asset management, and budgeting services. Some tools help companies and individuals to keep track of their credit card transactions, bank accounts, loans, transactions, investments, and many more. And you can get all these done using just one app.

    Amidst all these impressive developments, there’s still scope for smarter, streamlined, and enhanced banking and personal finance management. Today, there are apps for personal finance management that enables the users to connect their accounts in the U.S banks. It also streamlines their finances.

    1. Quick and affordable small business accounting

    It is always better to use an effective and easy tool for automating personal finance management. However, some professional accountants need assistance with bookkeeping. Making use of paper, pen and excel sheets for managing business finance is no more considered a smart solution. It is the era of business digitization. Today, there is QuickBooks that has brought in a significant evolution in the domain of Fintech.

    However, the actual development has just started! With the organic evolution of cloud SaaS technologies, the accounting process has become simpler than before. It is also more affordable and safer. Today, there are accounting tools, which streamline accounting for freelancers and small business firms, at no cost. There are also other advanced solutions that can streamline accounting, invoices, payments as well as the payroll services.

    1. Advanced money transfer processing and payment

    Over the past few years, payment processing has developed significantly. Also, because of the massive development of mobile commerce and eCommerce, it is estimated that more than five billion people will resort to mobile payment by 2020.

    Regardless, of whether there’s a solution for mobile payment, alternative money transfer, or a device that processes credit card payments – every product that caters to the requirement of a faster, easier and cheaper payment processing, has every chance to flourish. Furthermore, the global giants like Google and Apple, today also vouch on mobile payments.

    1. Micro-financing and peer-to-peer lending

    Today, the major peer-to-peer lending organizations can resolve issues that even the banks fail to address and solve. They act by dis-intermediating the credit process and connecting the prospective borrowers with the loan providers, using an ace P2P platform. Hence, business and consumer credits are easily accessible. The entire process becomes easy, fast, and convenient. And there’s immense scope in this domain that can be discovered in the days to come.

    Also, the financial landscape awaits the launch of IFISA, which stands for Innovative Finance Individual Savings Account. It will further boost the growth of the P2P lending domain because of easy tax conditions. Micro-financing is yet another area that provides ample scope for Fintech development, especially in developing countries. In the coming years, it is meant to grow steadily by 15%.

    Also, there are finance-based start-ups, which blends payment and lending services. It also provides an alternative for financing choices. These services can provide users with installment loans, enabling them to purchase goods and make other necessary investments. It is particularly helpful for small business firms and start-up entrepreneurs.

    In its totality, the lending and loan market today promises scopes for immense development. According to the latest researches, it is expected to score approximately 1 trillion by the year 2025. Hence, the Fintech domain is here to grow and benefit the business and the financial sectors.