In a world of technology and digital tools, a business has to adapt to stay ahead of the game. Efficiency is key to revenue generation, and a business must make the right investment choices that will fuel the growth of the company. One of the best decisions you can make this year is to invest in Financial Technology, more popularly known as FinTech.
You may have heard of it, but not necessarily know what it is. Hearing about FinTech is understandable as it has continued to rise up the ranks of in-demand technologies as more businesses and consumers engage in it worldwide. In fact, the FinTech industry alone received $14.7 billion in investment last year.
Generally described as any technological development or innovation in the financial sector, FinTech has actually been around for quite a while now. For the past decades, the financial industry has gone through the following technological developments: credit cards, online stocks trading, e-commerce business models, mobile banking, and even alternative lending options.
Today, FinTech does more than just make banking transactions easier–FinTech can help boost your overall business in the long run. By revamping business models and processes, firms can level up their productivity through the help of FinTech as well as sustain the firm’s growth.
Here are just three of the top reasons why executives and top management should consider Fintech:
Reports from the EY FinTech Adoption Index in 2017 states that there was a 33 percent adoption rate for Fintech products. This shows that a lot of businesses and users are already starting to invest money and time in integrating FinTech into their daily lives. With FinTech as an integral part of your firm’s business procedures, your market share can increase as you offer new services and open business to new clients and customers.
For example, commercial banks in China used to only cater to Chinese-state owned businesses–small to medium-sized enterprises were neglected. In fact, according to a survey by the World Bank in 2012, Chinese SMEs only received less than 25 percent of loans from banks, even though SMEs contributed over 60 percent to China’s GDP. Because of FinTech, those who weren’t served before were finally given notice by new companies and startups. In turn, mobile payments and online lending became prominent sectors in China.
Data from Forrester reports that there are 72 percent of businesses say that their top priority is improving customer experience. However, only 63 percent ctually prioritize the implementation of technology investments that will help meet their goal.
Customers of today are hard to please. Businesses have to keep innovating ways to meet the customers’ needs in order to maintain strong relationships.
Did you know that nine out of ten people bank from the comfort of their homes? Millennials also engage in mobile banking at an average of ten days a month. Here’s another interesting statistic—65 percent of mobile bankers are confident that they know their account’s balance! The mobile banking revolution has caused customers to feel more confident, connected, and in control of their finances. It is a great example of customer experience at its finest because customers always look for something easier and faster. FinTech gives way to enhanced services that will make customers happier and more satisfied.
When it comes to the impact of FinTech on efficiency, the Association of Financial Professions conducted a survey which showed that 82 percent of organizations think that shifting to electronic payment systems can reduce costs. Meanwhile, the same survey showed that 88 percent of organizations view electronic payment as a means to increase efficiency.
FinTech provides businesses with more opportunities to automate procedures, which will result to a lot of savings in both time and costs. Automation can also cancel redundant procedures and speed up labor-intensive steps, leaving room to increase productivity. This is why a lot of firms invest in FinTech. Despite the initial capital outlay, the results speak for themselves.
MineralTree, an Accounts Payable and Payment Automation Software, is a leading company in the FinTech Industry. With its end-to-end automation solutions, they have helped businesses modernize and streamline their processes. Because of this, businesses that have integrated MineralTree in their operations are enjoying efficiency, reduced processing costs, less fraud risks, and improved internal controls. MineralTree continues to serve more than a thousand companies in different industries, such as retail, media, food, hospitality, and healthcare.
Without a doubt, technology continues to change our way of life. The finance sector is just one of the many industries that has radically transformed. FinTech has revolutionized business transactions to become easier, faster, and more accessible to a wider market segment. With FinTech, firms have leveled up and geared up towards sustainable growth in an ever evolving market.