Short for financial technology, fintech refers to the use of innovative and new technology to deliver financial services faster, more securely, and more affordably. As a result, there’s a fierce competition between the traditional financial service providers and intermediaries who offer more expensive financial services.
As an entrepreneur, you can take advantage of fintech in various ways that include:
• Getting to Know Consumers Better
By now, you know that there are no two exact customers and that the behaviors of customers differ. So, what’s the best way to engage and make customers loyal, seeing that each customer behaves differently?
One of the best bets is to customize reward programs to suit each customer using the reward platform (fintech). A typical example is the Rewards Platform Belly that enables members to see data relating to their customers’ shopping behavior.
• Expanding Your Horizons, Especially Credit
A lot of people do not have credit history, or probably have just a little credit history. The credit scores are important to traditional lenders, so that they can figure out a consumer’s borrowing power.
The peer-to-peer financial techniques would go a step further to take cognizance of social data. Subsequently, it is easier to determine a consumer’s credit worthiness. As a result, entrepreneurs can leverage financial technology to sell financial advice to consumers, especially in terms of their spending and how best to take advantage of financial institutions’ products.
• Getting Rid of Middlemen
Money transfer has become increasingly seamless and affordable through digital currencies – e.g. Bitcoin. As a result, new micro-markets are created as transactions take place in lower values (in terms of cost) and at volumes that are much higher than usual. This ultimately gets rid of third parties (middlemen) who, through their activities, make the costs of financial transactions unnecessarily high.
There are other tons of ways that entrepreneurs can benefit from fintech.