What is fintech and why does it matter to entrepreneurs?
Despite the $17.4 billion invested in 2016 in fintech, most entrepreneurs are still unsure about its advantages and what it truly means for e-commerce.
The term FinTech has been around for a hot minute now, but it seems that a lot of people are still wondering what it is and how it works. You can read about it in almost all financial media and technology websites, yet there are still a lot of questions around it, that’s why we are going through all of them to help you understand how it works and how it can push any business to a whole new level.
Definition of Fintech or Financial technology
The term Fintech is a relatively new word in the industry. In fact, if you search it on the dictionary, you won’t even find it. However, it has gained a lot of importance during these last three years and it’s now impossible to ignore it.
The word Fintech is the abbreviation of ‘’Financial technology’’. A new technology that has been developed in recent years with the aim of replacing the traditional financial methods. Today, smartphones are the devices that use this service the most because it allows users to access and perform a series of actions safely and quickly without the need to go to a bank.
But this new technology not only allows customers to view their online transactions, it also concedes the ability to do mobile payments, money transfers, loans, fundraising and other services such as buying products and services online.
The popularity and investments in fintech have been so fast, that some sectors haven’t been able to adapt their businesses to this innovation as quickly. As a matter of fact, Europe has experienced the highest growth rate between 2008 and 2015, thus forcing companies to restructure their regulations and making them re-evaluate its customer’s behaviour.
With the advent of fintech, the way finance and e-commerce used to run is now changing completely and will continue to do so in the next few years, however the adoption rates across the world is growing.
How fintech has changed the way business is done
Not only did it change how companies do business, it also changed the way customers buy. Long gone are the days when someone would open its business and turn to their local bank to manage their profits or looking for funds. Nowadays, entrepreneurs and startups can get investors to help them from anywhere in the world in a matter of weeks.
‘’It is estimated that there are about 20 million small companies in Europe that still doesn’t take card payments.’’
In one of our posts, we’ve already talked about the future of fintech and how much impact it would have on e-commerce, but what we can truly say is that online payments, money transfers and savings are just a few of the things fintech has made easier and cheaper. That is certainly something that any corporation or company would need on their budget strategy. But, why are there still companies that do not use it?
It is estimated that there are about 20 million small companies in Europe that still doesn’t take card payments. If we dig into a little bit more, we can see that the main reason why they are not accepting this payment method is due to its cost. That’s when companies like SWAPPT come into action.
SWAPPT offers the chance to any startup or small business to provide multiple payment methods to their customers and take international card payments just like any bigger company does. There is no good reason why a small business couldn’t compete with larger competitors and understand how the market works. By providing them with this kind of service and with the analytic tool, entrepreneurs are capable of taking a big step forward and grow their income.
But fintech has only just got started. Entrepreneurs need to keep their eyes wide-opened with future developments coming. We don’t know how much time fintech is going to stick with us or how much will it change from now, what we do know it is a vital part of our lives right now and any business willing to improve and grow needs to be at the forefront of the market.
