More Money In Their Pockets 1
More Money In Their Pockets
Leah Smith
FIN4323
More Money In Their Pockets 2
Financial technology (Fintech) has given small businesses and their owners an
opportunity to grow and strengthen their finances and businesses as a whole. From mobile
payments to POS systems, accepting payments couldn’t be more simple. Fintech has developed
techniques and software to organize business’ finance and help them be more successful. There
are three companies that are not only some of the top Fintech companies, but they also aid in the
growth of small businesses—Stripe, Xero, and Avant. The comparison of these three companies
and how they have helped and assisted small businesses grow will be shown.
Financial Technology is improving and innovating ideas to help assist and promote
success in small businesses. They are companies or services that essentially use technology to
improve all financial activity—including speed, convenience and accessibility. Fintech not only
benefits small businesses and businesses as a whole, but consumers as well. Financial technology
first began around the 1950’s—when credit cards were invented to create an easier way to ‘carry
cash’. Next came the 1960’s, when ATM’s were created for convenience but could potentially
replace tellers and branches. In the 1970’s, electronic stock trading evolved. The 1980’s brought
on more sophisticated data recording and improved computer technology drastically. By the
1990’s, internet and eCommerce was invented, which in turn made many businesses expand
rapidly. According to Forbes.com, “Fintech developments were creating more sophisticated risk
management, trade processing, treasury management and data analysis tools at the institutional
level for banks and financial services firms. While these systems are not apparent to retail
banking customers, they make up a multibillion industry aimed at supporting the needs of the
financial services sector. (Desai, 2016)” Financial technology has created a platform and
structural development that most people wouldn’t even think about today. Banks were expecting
to be hurt by some of the Fintech companies. On the contrary, financial technology has helped
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them succeed and grow at a faster pace. Banks were able to offer more services to their clients to
help them save time, convenience, track and organize their finances easier, and ultimately make
more money.
Fintech has made a huge impact on small businesses as a whole. The amount of
technology that is offered now, is night and day from 70 years ago. More specifically, it has
given small businesses better financial options such as merchant services, automatic accounting
and online payments. There are multiple financial options that financial technology has offered
to small businesses. Some of these include: small business loans, credit cards and loan equity
fundraising. By offering finance options online, businesses were able to complete the application
process easier and get loan and credit options sent back quickly—an overall easier transaction and
faster process. According to the New York Times, “New technology companies were also able to
