I’ve been a small-business entrepreneur for more than 30 years. When I first started my own small accounting company back in the year 1984, it had just three clients. In the years that followed I’ve experienced my moments of joy and sorrow. I recall one morning, I was at my local bank, trying to obtain a loan of $25,000 after I’d just won an important client and needed money to pay the bills.
After spending more than 3 hours talking to the bank’s owner I returned empty handed and experienced the same outcome in all four banks I tried even though I had my finances in order. In order to raise money I decided to sell my car and collection of stamps — at an auction. (Yes I did have the stamp collection!)
These days, things are drastically more challenging for businesses and fintech could take a portion of the blame.
It’s clear that this is not just a passing trend but an important game changer for small and micromedium-sized enterprises (SMBs). Although these companies previously faced difficulties because of the absence of support from banks, they’ve now found inexpensive solutions with fintech.
The solutions can benefit entrepreneurs from freelancers, founders of startups to the leaders of small-scale businesses that are growing and other businesses.
A wide range of fintech product and service solutions
According to The Financial Times reported, this financial support offered by fintech companies can be found in the form credit and advice foreign exchange, and other fintech-related products and solutions. Recent BI Intelligence research report reached similar conclusions. For instance the BI report stated that, unlike traditional financial service providers who are focused on large corporations fintech companies have more revenue by filling holes in bank accounts , and other digital business services designed for SMBs.
An World Economic Forum report gave this trend more praise and described it as a paradigm shift where fintech companies are helping entrepreneurs from developing nations to be part of the global business world. This is in significant part, the report noted, to the solutions offered by these companies such as peer-to peer lending as well as merchant and ecommerce financing such as invoice financing as well as supply chain financing and trade finance.
This is why small-sized businesses are increasing market share in both the offline and online business worlds as well as attracting customer and business customers who are enthused by their personal services and distinctive offerings, but still benefiting from safe transactions.
Lending is among the most crucial areas in which fintech has provided a solution for small-sized businesses. Because smaller businesses don’t usually require a large amount of cash when seeking loans, they’ve been unable to receive any financial assistance. The reason is that banks and lending institutions usually don’t make any gain in lending for less than $100,000.
Usually, a bank needs collateral that a small business owner does not have. These two factors have created a gap that fintech firms could fill with what’s known as “microloans,” which the Small Business Administration defines as loans that are as much as $50,000.
A prime instance of a fintech business offering loans like this is Kabbage, which offers the ability to access this kind of credit in few minutes using an app for mobile devices. Fintech companies such as Kabbage provide unbeatable speed and ease of use; additionally their credit requirements (e.g. credit scores) are not as restrictive as banks’ and also their interest rates are lower.
I personally tested them and was quickly accepted for $25,000. The business owners aren’t aware of how far we’ve come and the options in their hands immediately the next day. The money was on my account within a day.
Another lending platform on the internet, LendGenius, allows small business owners to look at the various financing options without having to complete a plethora of documents. Instead, you sign in and get a list of most suitable lenders for your needs as a business. It’s a simple application, regardless of whether you have multiple lenders. It also provides rapid approval and fundingoften in less than 24 hours.
Invoicing and tracking expenses
In order to earn profits, small-scale business owners need to pay their employees and track their expenditures. That’s why they should consider an accounting system for small businesses which is affordable and caters to the specific needs of their business.
Enter Sage is the fintech firm that provides Sage Invoices and Expenses an app for tracking expenses and invoicing intended for smaller businesses. This app for free offers an integrated financial, payroll, and accounting solution that streamlines the accounting process and cuts down on the time spent on these important elements of a company.
The business owner doesn’t require IT abilities or accounting expertise to make the most of this fintech application. Some accounting software assumes that a business owner knows the jargon of accounting however, Sage Invoices & Expenses uses regular language, like “Money In” and “Money Out” -that anyone is able to comprehend.
Receipts are easily captured at the tap of a phone and saved within the app, which allows the access of them to different requirements. Additionally, invoices can be handled while on the move and invoices that are due for payment trigger an automated reminder. In addition to making things easier for small-business proprietor, fintech invoice solution such as this improves the customer experience and gives new insights into the state of your business finances.
A plethora of cool fintech tools to help small-sized businesses
There are many innovative and innovative Fintech companies that are emerging every year that provide more assistance directly for small enterprises. For instance, Domuso is an innovative payment solution for owners of rental properties that makes use of the full stack rental-payment technology.
The fintech platform to take secure online payments using either a debit card, or an automatic clearing house transfers and residents can utilize the platform to pay rent payments online , or on their mobile devices. Domuso also provides installment loans that residents can repay over 6 up to twelve months and landlords still receive their money up-front. These loans are able to cover security deposits as well as other moving-in expenses, which helps landlords find more tenants.