It comes as no surprise that the computer system developed in the 1970’s – Automated Clearing House (ACH) – still serves as the default technology for many businesses today. Overhauling this system to meet the essential need for complete digital transformation on the part of banks and payment systems has been an uphill battle. Which is why the digital revolution in emerging markets, historically viewed as being less developed, and led and informed by Fintech startups, should give pause to the leaders of our C-suites and boardrooms.
Lessons of the pandemic
The pandemic had consequences, one of which was the sudden acceleration in the implementation of the software we use in business. Pandemic behavior alerted businesses that they would be less productive if they continued to be laggard with the digital transformation necessary to take advantage of new solutions, but this transformation remains elusive to achieve. Not many stakeholders understand the scope of projects, compliance is difficult, and with the emergence of new SaaS software to compliment or solve issues not solved by the larger ERP and CRM solutions, it got more complicated.
But one aspect of business cannot wait for this transformation: the handling and exchange of monies. And here, Fintech has been leading the way. They’ve been incubators of effective and easier to use solutions and are redefining finance. The digitization of payments enhances efficiencies, productivity, security, and with internal and customer compliance to ensure the transformation is successful, greater margins and improved bottom lines can be achieved.
What the future looks like
The physical landscape also changed during the pandemic. Did your bank branch remain open? Banks and credit unions are predicting an even greater disappearance of their brick and mortar in 2030 as people are now mostly mobile and laptop, and this trend will continue. We will rely on the Fintech’s to improve the digital customer experience and to make the transition as seamless as it is secure. To date, this has resulted in an almost exponential growth of the digital payment ecosystem.
With growth comes great responsibility
Businesses, both big and small, serve many stakeholders and have myriad obligations when it comes to all issues financial.
With employees, companies need to disperse reimbursements and expenses beyond salaries and, to date, have relied on different ERP and HRMS systems. But these are often siloed, unconnected, and become cumbersome and more times than not, result in employee dissatisfaction. Fintech solutions connect them to increase efficiencies or provide automated solutions that are truly employee friendly.
With vendors, new Fintech solutions allow vendor information and payments to be made faster, more efficiently, saving time at the source of payments. Fintech understood that paying a vendor in big or smaller amounts took the same amount of time, and that smaller payments made faster adds a tremendous amount of residual appeal. Credit cards are also a way to transact, and provide a more flexible, customizable means of payment, and fintech also took that solution into account.
With Human Resources (HR), gifting, rewards and recognition programs require time to choose vouchers or brands every time they want to reward employees. Fintech stepped up to relieve this additional time bandit by providing all in one corporate gifting solutions that makes it all one-click process, further enhancing employee motivation, which can also affect the bottom line.
How to give your data credit
Cash is no longer king. Credit is. And with the increase of credit cards and credit payers as both a payment and lending alternative, risk increases exponentially. Currently, we are seeing cases of fraud that is hard for even the Big 5 banking institutions to keep up with. Financial institutions will have to get a handle on this, and one hopes that fintech will lead the way. In the meantime, they have created the technology that allows businesses to collect the data they need to understand the true credit worthiness of customers with a low credit profile. The more data, the more credible the data, and post pandemic, many things have changed for both businesses and customers and enhanced data can provide a clearer picture. When UPI is embedded in the technology, it can create a scorecard, allowing businesses to reach out to those with a low credit profile but are credit worthy none-the-less.
Tomorrow started yesterday
Fintech’s powerful SaaS tools and machine learning advances can transform payments, expense management, accounts payable, credit cards, enhance security and streamline processes, freeing the most talented people in the business to do the things a business really needs done to thrive in our uncertain future. Every business is in the Age of Digital Transformation. Business leaders need to help their organizations embrace change, navigate disruption, and ready themselves for tomorrow’s challenges today.
Almond FinTech is a blockchain-based funds transfer network connecting financial institutions globally. Almond’s infrastructure, is built for speed, security, and accessibility, enabling users worldwide to send money across borders using their existing financial institutions. Additionally, Almond uses a combination of psychometric and financial data to provide fast, low-risk, ethical loans to communities with unconventional or limited credit histories.