What is Fintech Business Banking?Bank.pro Sales Team
FinTech is a general term used to describe any digital product or service that uses current digital technology to provide financial services for consumers. Consumers in this context can be individuals or businesses. Financial Technology as we know it today was not always like this. It initially gained traction as the technological framework that huge financial institutions used to provide their services to their clients. Now, it is a whole industry on its own, almost fully separate from the traditional institutions and focused solely on the consumers.
FinTech Business Banking has also evolved, going as far as taking cryptocurrencies like bitcoin under its wings. They all claim to be doing things differently from the traditional financial institutions, and embracing cryptocurrencies was a great statement of intent. The digital revolution aided the broad acceptance and adoption of Fintech Banking services. From the comfort of your home, and even from your mobile device, you can create a bank account, raise money for your startup, save and invest your money in ‘unconventional’ digital assets, gain access to credit facilities for personal and business use, and many other financial services.
With their various aggressive marketing and growth efforts, FinTech Business Banks are regarded as disruptive, especially towards the traditional banks and financial institutions. Ease of access and simplicity of processes already in their benefits, FinTech banks are focused on reaching a generation of technologically savvy people, the unbanked, and those looking to grow their businesses. As the days go by, the term “FinTech Business Banking” continues to expand its wings, looking for loopholes in the traditional financial services industry and plugging them with digital banking solutions.
For businesses, FinTechs offer solutions with payments, commercial lending and credit facilities, employee remuneration management, capital reinvestment opportunities, venture capitalism and so much more. All these have played roles in the adoption of Business FinTechs by startups worldwide.
FinTech Business banks offer numerous advantages in comparison with traditional banking institutions. Some of these advantages are outlined below;
- Low Operating Costs: FinTech Business banks charge little or no fees on the transactions performed on the accounts with them. Subscription fees are usually paid for access to their services. However, when this is compared to the various duties, taxes, and maintenance fees paid to traditional banks for a business account, FinTech Business banks are cost-effective. This feature is beneficial for many startups and SMEs (Small and Medium Enterprises) who are looking to minimize running costs as much as possible.
- Easy Access and Faster Service Delivery: If you have ever applied for a business account with a regular bank, you’re well aware of the time, documents, and long banking hall queues involved. This is not the case with FinTech Business banks. From your digital device, you can sign up, submit all documents, and within a stipulated time, your account is up and running. The service delivery, especially with inquiries and resolution of issues is faster and more efficient than traditional banks.
- FinTech Business Banks are ‘Customer-centric’: Since the origin of these FinTech banks is to solve the problems of traditional banking, they are focused majorly on you, the customer. The traditional banks are focused on making a profit, and thus, that drives and guides most of their operations.
- Utilization of Latest Technology and Innovation: FinTech banks are futuristic in their thinking and decision making and thus, they use the most recent digital tools and technology to deliver their services. There is a broad purview about innovation and endless room for ideas and this offers it an edge over the very conservative traditional banks.
- Fair Regulation and Policy: Financial Technology is not without regulation, however, in contrast to the regular banks, the regulation is fair enough. The documentation, legal issues, registration, quotas, and other governmental burdens that have grown over the years affect these banks and as a consequence, their customers. In the case of FinTech banking services, the regulations are lighter and do not weigh heavily on their services.
Covid-19 brought with it various economic disruptions and interruptions. The major blow was the restriction of movement that came with the “LockDown” periods. By convention, traditional banks require physical presence at their brick and mortar branches to perform business transactions. The ‘new normal’ crippled majority of their business capabilities worldwide and they suffered huge financial losses to that effect.
The story was the opposite for the FinTech Business banks as the demand for unconventional banking solutions grew during the pandemic. Some of them had been around before this period, so they were easy replacements for the then closed and limited traditional banks. In that period, many more FinTech banks sprung up in various locations across the globe. Many of them came with ‘juicy’ offers, proferring solutions to banking issues that people and businesses suffered at the time.
These FinTech banks gave businesses a lifeline, a helping hand that came very handy during the turbulent pandemic period. Businesses were able to collect and process payments (local and international), obtain loans and credit, and invest their profit, all from their digital and mobile devices. Since then, FinTech Banking solutions have been available to all and sundry, forcing traditional banking institutions to innovate around their existing rigid protocols and services. The effects of the pandemic will shape our economic behaviors and the way we’ll do things in years to come. This points to one fact; FinTech Business Banks and financial services are here to stay!