Fintech is a broad term for a wide array of financial technologies that are disrupting the finance world for the better.
What is Fintech?
If you’ve heard the words cryptocurrency, blockchain, insurtech, crowd funding, unbanked, or even online application, these all fall under the fintech umbrella. According to Investopedia, “fintech, which originally referred to computer technology applied to the back office of banks or trading firms, now describes a broad variety of technological interventions into personal and commercial finance.”
Great. But what does that actually mean?
It’s hard to define fintech simply because it is constantly changing. New applications make new things possible all the time, so today’s definition may be obsolete tomorrow.
How Does Fintech Benefit Small Businesses?
The ambiguous definition of fintech is a good thing.
Small business owners typically have a hard time getting approved at large, traditional financial institutions because operational expenses make smaller loan amounts cost-prohibitive. It’s cheaper for them to make fewer, larger loans than it is to make more small loans. Fintech makes it possible for lenders like Lendistry to innovate ways to fill the gap and provide access to capital.
Fintech opens up access to the data and resources that large, traditional banks once enjoyed exclusively. It also opens up access to data and capital that were closed to many local community banks after the banking crisis of 2008. This makes it possible for small business owners who have been rejected by traditional banks to access the capital they need to grow.
How Does Lendistry Use Fintech?
Just having an online application for financing is fintech. Through our online portal, we can reach any business owner anywhere in the country and offer them small business loans. They are no longer reliant on going in person to a bank. As our CEO, Everett K. Sands often says, “Banks are open 9 to 5, but small business owners are working from 5 to 9. We meet them where they are.”
Here at Lendistry we have our own proprietary fintech. Our online application portal allows clients to apply online, and they can even opt to link their bank accounts to access documents for faster application completion. The application process can even be started on a smartphone or other mobile device. This makes the process faster and more widely accessible, and we are all about more access for more small business owners.
While fintech can sometimes sound like an abstract buzzword, it is the key to opening doors that were previously closed to small businesses owned by women and minorities, businesses in rural or low-income areas, or businesses that need smaller amounts of money to take the next step.
The most important element to take into account from a customer’s perspective when it comes to fintech is the human behind the technology. Fintech gets a negative reputation because it is perceived as impersonal and disconnected from quality customer service. At Lendistry, our team of professionals stands behind every application to provide help and training so small business owners have the best chance to receive the funds they need to grow.