Humongous Opportunities of Fintech Business: Insights and Foresights
“Fintech, a must-have tech to speed up and ease all the financial activities in the world, unleashes unlimited business opportunities for disruptors”
Fintech service companies are accelerating the means that consumers and companies conduct transactions for a long time and transforming the structures of financial services. Consequently, there are humongous opportunities in the Fintech sector for entrepreneurs and investors. Ground-breaking Fintech disruptors who offer speedy and errorless financial services have achieved a wide-ranging impact in every sector. In addition, among all the financial transaction issues in the era of Covid-19, for all sorts of transactions, Fintech service companies play a major role to fill the space left by traditional institutions of financial services.
Top benefits of Fintech
A rapid growth of Fintech in several sectors has resulted in many benefits that include:
Accessibility and approval
The key benefits of vendors are faster accessibility and speedy loan approvals. Because of a quick and hassle-free process, vendors become more adaptable to this new technology.
Better experience and convenience
In a single platform, consumers enjoy a very convenient payment method and feel a better experience when they process any payment from devices such as Smartphone and tablet.
Chatbots and Robo-advisors
Several latest systems depend on chatbots and robo-advisors to help users understand their finances. As Fintech is a very low-cost option, people get more useful information.
Better payment systems
Fintech is powerful software which is very helpful for companies to collect payments accurately. It also helps everyone to know their updated account status.
Here are some of the most promising verticals that generate ever-growing business opportunities for financial technology disruptors who want to Fintech the world.
International Money Transfer Services
Costly and time-consuming international money transfer services survive for a long time. These money transfer companies charge from five to eight percent. Fintech companies, who provide the services of international money transfers, offer faster process charging less expensive fees. This is one of the best categories for generating Fintech businesses as this service can unlock global opportunities.
After the dawn of Fintech companies, the process of lending has successfully entered into the next level. Nowadays borrowers don’t contact banks or credit unions for availing any lending-based services. Most of the Fintech lending companies provide services directly to consumers who request loans online. Fintech lenders measure the credit worthiness of borrowers very quickly with the support of automation and process the procedures of lending immediately. Hence, there are unlimited business opportunities for disruptors who are ready to focus on providing specialized sector-based lending services.
The Rise of Fintech and Personal Finance
The rise of Fintech market has transformed the entire structure of personal finance. Some years ago, people met financial advisors at banks if they require any financial advice. At present, Fintech apps have mushroomed here and there and offer financial advice for budgeting anywhere at any time. Fintech companies who want to enhance the world of personal finance can develop niche apps that will provide advice on personal finance for a wide range of professionals.
Opportunities in Equity Financing
Fintech service sectors have also entered into the world of equity financing. When it comes to macroeconomics, Fintech companies support all the sectors to raise money providing fast and reliable approaches. With simplified fundraising process, investors carry out every process online without delay. So Fintech disruptors can provide equity financing services based on the type of business sector.
Fintech-centric payment is one of the fastest growing categories in financial technology markets. Fintech companies offer payment services for senders and receivers so that they don’t rely on banks. Since banks charge excessive fees for simple payments, Fintech companies help consumers send money cost effectively and quickly. To generate business opportunities in this category, both investors and entrepreneurs should discover the types of consumers, who largely depend on payment services, and provide services based on a type of consumer.
Fintech or Insurtech companies have gradually occupying the insurance market. The rise of Fintech has totally disrupted the insurance industry. Because of rapidly growing situation and aggressive claim by consumers, several insurance companies are partnering with Fintech companies that offer solutions for quicker transactions. This category is also one of the best options for Fintech disruptors who want to transform the world of insurance with sector-based insurance services.
Apart from the above existing types of services, Fintech can open the doors for new disruptors in finance business process and public finance for emerging markets.
Finance business process
A finance business process, a chronological set of tasks that deals with various data-based procedures, includes different types of processes on a daily, weekly, monthly, quarterly and annual basis as follows.
- Accounts payable
- Accounts receivable
- Asset management
- Billing and credit
- Capital expenditure
- Employee reimbursements
- Expense management
- Inventory management
- Payroll system
- Procurement management
- Retail and wholesale management
- Safeguarding assets
- Travel management
- Treasury management
- Working capital management
Established Fintech companies or start-ups can create micro opportunities for providing services based on each process of finance business process. In macro economics, Fintech service providers can create opportunities for providing services appropriate to the management of finance business process of a particular sector. In every sector, as start-ups keep evolving, there will be new opportunities forever.
Public Finance deals with government financial activities that manage government revenue, expenses, and debt. Major aspects of Public Finance encompass:
Tax Revenue encompasses corporate tax, excise duty, goods and services tax, income tax, taxes levied on imports and exports. Non-tax revenue encompasses surplus of public sector undertakings, income from fees, capital receipts, grants, fines, and central bank revenue.
Components of public expenditure include defence activities, provision of social security, economic development, healthcare and medical research, infrastructure development, and maintenance of the government.
Major public debts include:
- Compulsory and voluntary debt
- Funded and unfunded debt
- Internal and external debt
- Productive and unproductive debt
- Redeemable and irredeemable debts
- Short-term, medium-term and long-term loans
Established Fintech companies or start-ups can keep eye on creating micro opportunities for providing services based on each public finance process such as revenue, expenses, and debt. In macro economics, Fintech service providers can create opportunities for providing services appropriate to the public finance management of a particular country.
Financial technology companies provide a broad landscape of business services such as financial management, personal financial control, business receipt solutions, digital bank account, credit card and machine, payments, debt negotiation, loans and investments, and insurtech. Some of the Fintech companies include:
- Alternative lending marketplaces: LendingClub, Prosper, and OnDeck
- Blockchain technology: LeewayHertz and Consensys
- Cryptocurrencies and digital cash: BitGo and Bitcoin
- Financial cybersecurity companies: EverCompliant, Forter, and CrowdStrike
- Insurtech companies: Lemonade, Oscar Health, and ZhongAn
- Money transfer and remittances: PayPal, TransferWise, and Venmo
- Mortgage lending: Better Mortgage and LendingHome
- Neobanks: N26, Chime,and Monzo
- Online business loan providers: Kabbage and Lendio
- Robo investment advisors: Wealthfront and Betterment
- Stock trading apps: TD Ameritrade, Robinhood, and Schwab
The technological revolution, especially cloud computing, has digitalized business functions across all types of industries. In the same manner, Fintech, one of the modern service sectors, has transformed financial and banking sectors and made financial procedures customer-friendly and corporate-friendly. Since it supports both consumers and companies to save time and efforts by offering fast-paced solutions, it will keep bringing business opportunities forever.