Fintech or financial technology startups are the latest companies using technology to disrupt conventional businesses. Traditional banking models don’t bound fintech services, and they are customer-centric, focusing on integrating technology fast.
One central area where fintech services are disrupting traditional banks is in the area of loans. This is because fintech startups offer flexible small business loans instead of the very strict, rigid, and almost discouraging requirements of traditional banks.
Fintech companies target specific pain points of customers
Rather than merely improving their banking services like traditional banks, fintech services take their time to focus specifically on customer pain points. Fintech startups often believe in the one customer, one bank policy where each customer is treated specially.
In addition, many fintech startups implement the right business culture of scaling up as their customer base grows, so no customer feels neglected.
Fintech startups do not have unnecessary banking fees
Fintech services understand that it is hard to pull away customers from traditional banks, and they do their best to impress every customer. Fintech companies do not have the unnecessary banking fees, transfer fees, and deductions that regular banks have.
Fintech companies have implemented technology better than traditional banks
Fintech startups are at the forefront of using emerging technology in the banking system. They use data analytics, machine learning, A. I., and other disruptive technology. The “tech” in the name “fintech” or “financial technology” isn’t a mere appellation.
Fintech startups know their onions regarding using technology to offer financial services, and customers love them for this. Fintech institutes often have better mobile apps and more intuitive websites than traditional banks.
Fintech companies offer better interests in savings
Fintech institutions offer better interest on customer savings than conventional banks. So, it’s no wonder that customers are willing to move their money from traditional banks to these fintech businesses that offer them better returns on their capital.
Fintech startups are faster to implement good policies than traditional banks
Traditional banks are rife with bureaucracies, office hierarchies, archaic communication systems, corporate clashes, office politics, and other issues that make them slower to implement economic and financial policies that benefit customers.
New employees of traditional banks often find it hard to proffer new ideas and newer solutions as they are often absorbed into the culture of the conventional bank like a sponge.
This is unlike fintech startups, where new employees can have a say in improving things. Fintech services are not run like an “old boys association” or club where everything must be too formal.
Fintech startups are fast to respond to customer complaints
Fintech services respond faster to customer complaints and issues than traditional banks. Problems are resolved quickly and with minimal back and forths.
Fintech services offer better small business loans for businesses
When small businesses go to banks for loans, they will ask to produce several documents, collateral, guarantors, SSN(social security number), among other requirements.
Also, they offer loans at high-interest rates and less flexible repayment schedules. And the total costs of their loans are often high, with many other extra fees.
But fintech institutions are less stringent with their requirements, and they even offer small business loans to immigrant business owners without SSN or credit history. Also, they are more willing to listen to business owners to understand their needs and how to serve them better.
As a small business owner or a regular user of banking services, you are best served by a fintech. They can handle anything from small business loans to merchant cash advances to working capital loans.
Fintech services are growing faster than traditional banks, and it’s no wonder that many conventional banks now copy some things from fintech startups. Try a fintech today to get the best of postmodern banking services.
Arnab is a passionate blogger. He shares sentient blogs on topics like current affairs, business, lifestyle, health, etc. To get more of his contributions, follow Smart Business Daily.