10 Benefits of FinTech for small business owners

The term "FinTech" refers to any technological innovation in the financial sector, including those designed for the back-end of established financial institutions as well as disruptive technologies developed by upstart companies or individuals. 

It may seem that technological solutions in the financial industry have a huge impact only on the lives of large enterprises, but it is not true. Very often, small and medium-sized companies around the world take advantage of FinTech to develop and also enable faster and more efficient digital transformation and provide more opportunities to offer their services around the world.

Table of Contents:

1. Find out what 10 key benefits of FinTech are for a small and medium-sized companies.

1.1. In creased Access to Capital.

1.2. Lower overall costs for small businesses.

1.3. Improved Cash Flow Management.

1.4. Enhanced Customer Experience.

1.5. Streamlined Payment Processing.

1.6. Automated Bookkeeping.

1.7. Increased Security.

1.8. Better Data Management.

1.9. Increased Accessibility in the Financial Sector.

1.10. Increased Competition in the Financial Services Industry.

2. What FinTech platforms Railwaymen created from scratch?

2.1. FreshPay.

2.2. CostTracker.

2.3. Triple Tied Out.

3. Summary of benefits of FinTech companies.

Find out what 10 key benefits of FinTech are for a small and medium-sized companies

Increased Access to Capital

FinTech companies enable consumers access to a wide range of funding options, including:

• Loans to businesses through an online platform, often at a lower cost and with a faster approval process than traditional banks.

• Invoice financing: This method allows businesses to obtain funding by selling outstanding invoices to a FinTech lender, resulting in immediate cash flow.

• Crowdfunding: FinTech firms provide a platform for businesses to receive funding from numerous individuals, allowing them to access alternative capital sources.

• Merchant cash advance: A type of funding in which FinTech companies advance money to a business in exchange for a percentage of future credit card sales.

  Thanks to financial technology, traditional firms can secure financing more quickly and easily than through traditional financial sector channels.

Lower overall costs for small businesses

FinTech innovations often offer more cost-effective alternatives to traditional financial services, making it easier and more affordable for small businesses to manage their finances.

For example, FinTech apps may offer lower transaction fees, lower interest rates on small business loans, or reduced costs for payment processing. Apart from that, financial technologies can also automate repetitive and manual tasks such as invoicing and payment processing can save companies resources such as time and money.

Improved Cash Flow Management

Financial technology tools provide real-time insights into financial transactions, allowing firms to understand better and manage their capital. With a clear understanding of their financial situation, small businesses can confidently make informed decisions and plan for the future.

Enhanced Customer Experience

Traditional banks often cannot provide modern and fast customer personalized experiences. Then the FinTech industry shows up and offers a seamless and personalized customer experience, making it easier for small businesses to build and maintain strong relationships with their clients.

With a focus on customer experience, firms can differentiate themselves from their competition, attract new customers, and also often increase their profitability. To provide such services, a lot of them started using artificial intelligence as customer support.

Streamlined Payment Processing

For many companies, one of the greatest challenges is improving the payment processes. In the era of an increasing number of transactions around the world, companies are looking for solutions that shorten the time needed to manage transactions, and also enable them to partially or fully automate processes using, for example, artificial intelligence.

FinTech companies can easily accept payments from customers thanks to online payment solutions, reducing the risk of lost or delayed payments and freeing up more time for other aspects of their business.

One of the best examples of this type of solution is a platform prepared from scratch by Railwaymen for a Hydr client from the United Kingdom. Our joint efforts have resulted in a reduction in the standard factoring process, which is 14 days or longer for other companies. Hydr's technology makes this possible in just 24 hours. That is a true game changer in financial operations.

SEE CASE STUDY

Automated Bookkeeping

FinTech companies automate many manual and repetitive tasks associated with bookkeeping and accounting, freeing small business owners to focus on other areas of their business.

By reducing the time and effort required for bookkeeping, small business owners can make more informed decisions and grow their businesses.

Increased Security

The finance world uses advanced security measures to protect sensitive financial information and reduce the risk of fraud. With financial technology, small businesses can feel confident that their financial information is secure and that their business is protected from cyber threats.

There is a lot of FinTech technology, that enables firms to avoid security breaches or increase the quality of risk management in financial processes.

Better Data Management

FinTech companies provide real-time insights and analytics, allowing small business owners to make data-driven decisions. With access to accurate and up-to-date financial information, small business owners can make informed decisions, track their progress, and identify areas for improvement.

Increased Accessibility in the Financial Sector

FinTech software is designed to be accessible from anywhere, making it easier for small business owners to manage their finances on the go. With financial technology, small business owners can access their financial information and make decisions from their desktop, laptop, or mobile device.

Increased Competition in the Financial Services Industry

The rise of FinTech solutions has increased competition in the financial services industry, leading to better products, services, and pricing. With FinTech, small business owners have access to a broader range of financial products and services, provided by both financial institutions and FinTech companies, allowing them to find the best solution for their unique needs and budget. This increased competition is driving financial services firms to adopt new technologies, such as artificial intelligence, to stay ahead of the curve.

What FinTech platforms Railwaymen created from scratch?

When we mention the benefits of FinTech for smaller businesses, it is best to show them on examples of real solutions that function and are successful in the global market.

Below you will find a few companies that we have helped through digital transformation and changed the face of the financial market:

FreshPay

Its mission is to provide accountants with the tools they need to run their businesses more efficiently and easily scale. FreshPay aims to provide innovative financial technology that is simple to use and assists businesses in running payroll in a more efficient and straightforward manner.

Cost Tracker

Norwegian company that set out to create innovative cloud-based FinTech apps that help businesses save time and money by giving them total control over their costs. The main feature of the software is a comprehensive purchase management system that allows you to order items from various suppliers and plan your expenses ahead of time. You can find a catalog of over 33 000 different suppliers inside, and as this case study is being published (July 2021), more than 16 000 purchase orders have been successfully registered and processed through this platform.

SEE CASE STUDY

Triple Tied Out

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  SEE CASE STUDY

Summary of benefits of FinTech companies

FinTech has numerous advantages for small and medium-sized businesses. Companies all over the world can improve their financial management, gain access to funding, and reduce costs by utilizing FinTech solutions, giving them the tools they need to thrive.

If you have any ideas on how to implement FinTech software in your company or would like to discuss your web and mobile app concept, please contact us.