Can you imagine going back to the time when the technology did not exist to check account balances anytime, anywhere, using any electronic device, and to verify the seamless processing of your payments and other financial transactions? We can’t either. And we don’t want to. Without the perks of financial technology we enjoy today, doing and dealing with businesses would be difficult and time-consuming
Let’s take a closer look at how the hypergrowth of financial technology has improved the business landscape in the Philippines and how your business may further use it to your advantage:
SMEs’ financial transactions are a lot easier now in large part due to the emergence of mobile banking.
Mobile banking refers to the use of a cellular device to perform banking activities through digital platforms. It empowers businesses to speed up bank transactions by creating easier and more convenient processes to remit and receive money online, among many others. So how exactly does mobile banking work?
The mobile banking app
Banks encourage their clients to enroll in mobile banking to speed up transactions from both ends. Mobile banking saves time and resources for business owners who would otherwise send a messenger to finalise their bank transactions. At the same time, it benefits banks by allowing them to serve more customers within a short time frame.
To get started with mobile banking, business owners simply need to download the app and register using their business information and account they opened with the bank. The mobile app is often used to access account balances, which comes in handy so business owners can keep track of their credit and debit card purchases. It also allows them to pay bills and transfer money to another account.
Mobile banking eases credit and debit purchase tracking
Through credit and debit cards, business owners can make an expensive purchase without drawing a large amount from their bank accounts. They simply need to swipe the card and sign their name to finalize the transaction. They can make multiple purchases as long as the sum total of all their purchase is within their credit limit. The app compiles all their transactions, so business owners can easily review their spending through credit and debit cards.
Mobile banking allows businesses to easily pay corporate utility bills
Through mobile banking, business owners can settle utility expenses online instead of sending someone over to pay the bill. In doing so, the messenger can be assigned to more important tasks, instead of waiting in line to pay bills.
Mobile banking makes checking account balances a breeze
Through mobile banking, business owners can also log in to their phones to check their account balance for payments and deposits—whether the status of these transactions are pending or have already cleared. Business owners can also move cash from one account to another without having to go to the bank.
First Circle Tip:
To make the most of what mobile banking has to offer, check the features of your bank’s mobile banking app. The FinTech industry is still evolving at a rapid pace so you should expect software updates with new mobile banking features to be released regularly. By staying up to date with the features of your mobile banking app, you’ll know the situations when and where it can most benefit you. Follow your bank on social media to keep an eye out for announcements. Subscribing to their email newsletter is also a good idea.
International Wire Transfers
In the past, when business owners sent money overseas to pay for imported raw materials or outsourced services, they always relied on banks. But with advancements in financial technology and the growth of FinTech startups, businesses now have the option to send money through other wire transfer options. Companies that offer alternative wire transfer options are becoming more popular, capturing market share from traditional banks, because they have tighter margins compared to traditional wire transfers. In other words, their exchange rates and transaction fees are lower than similar fees charged by banks.
Aside from being more cost-effective, wire transfer companies also offer fast and secure services. Another plus is that there are more of them now. Since many companies prefer international wire transfers, more FinTech companies have addressed this increased demand by offering wire transfer services. Thus, business owners have more options to choose from.
First Circle Tip:
If you are among those companies that pay freelancers or purchase raw materials from a different location, make sure the wire transfer services you are utilising suit the requirements of your business. If you need money moved quickly, find a service provider that has the shortest turnaround time. If you are concerned with the rates, do your research to see which service provider has the cheapest rate. But also, be careful not to compromise privacy and security for a low rate.
In its simplest sense, E-commerce refers to commercial transactions conducted online. Retail brands who want to stay ahead of the competition develop E-Commerce solutions for various good reasons.
Through E-Commerce platforms, businesses can tap their target market better. And since E-Commerce makes commercial transactions faster and more convenient, they also have better chances of increasing sales at a rapid rate. Moreover, it keeps business expenses down because it costs less to promote products online through E-Commerce platforms than to put up a physical store.
First Circle Tip:
To make the most of an E-Commerce platform, do your research meticulously. Consider pricing, payment, 3rd-party integrations, and the platform’s potential for scalability.
Small business accounting
All businesses need to have their books in order. For smaller companies, bookkeeping and accounting requirements are simpler. But as the business grows, so do the accounting needs. Regardless of company size or organisational structure, it pays to have a system for helping business owners keep track of their critical business numbers. This is made easier through cloud-based accounting software, which is another financial technology product
Before the advancements of financial technology came into the lives of business owners, books had to be kept manually, It was time-consuming and prone to errors. Accurate record keeping is proven to be a difficult task for bookkeepers and accountants who had to rush to meet deadlines, especially during tax season. Another problem was that since financial data can only be accessed on a single computer, financial data cannot be accessed by any other person in real time.
Nowadays, there are many business accounting software options. Business owners have the liberty to choose among a wide variety of cloud accounting software. Features, benefits, and pricing are among the things that business owners need to consider. With the right accounting software in place, they can easily pay taxes, do payroll, send an invoice, and keep track of their expenses, among many tasks.
First Circle Tip:
Business accounting programs offer different features and benefits. When choosing one, identify first which features your business needs most. Typically, optional advanced features are available for business owners who are willing to pay more.
Another tip is to get feedback from other business owners so you’ll know what to expect. Lastly, keep an eye out for the program that offers customer support services 24/7. This will make it easier for you to contact them when technical glitches happen.
Stock market investing
If you think stock market investments are only valuable to large corporations and investors, think again. Stocks, or shares of ownership in a corporation, are attractive investment options for business owners as well. They can generate income, diversify risk exposure, and potentially increase their companies’ net worth by investing surplus cash in the stock market.
The good news is that our current financial technology landscape in the Philippines allows businesses and individuals to access the stock market easily. Stock market investments allow business owners to be more proactive, easily buying and trading with just a few clicks.
First Circle Tip:
Look for investment apps that are easy to navigate and are available on Android and iOS.
Financial technology holds the key to increased productivity and cost efficiency, especially for SMEs. To grow and scale your business, you need to embrace FinTech and be open to the different ways by which financial technology can help your business achieve its full potential.
First Circle is a private FinTech firm that helps local SMEs to achieve their business goals by providing convenient business financing options to cover business capital gaps. Click here to apply for additional business funding.