Fintech banks will replace traditional services from the market in the next 5 years
The head of Klarna and expert in the field of fintech banks Sebastian Semiatkowski is sure: the traditional banking will exist no more than 5 years. This conclusion is made by the expert on the basis of the directive PSD2 of the European Parliament, which requires banks to exchange information about users with external suppliers in order to develop new projects in the financial industry. The professional emphasizes: millions of dollars are invested in startups of this sphere, they see the future in them. World-renowned organizations such as ING or Goldman Sachs have already started to change it, which will allow maintaining positions in the market in the future.
Fintech banks will facilitate the work of small and microbusiness
Users are ready to trust fintech projects. They offer huge benefits, especially for business. Small business entities in the world demand quick and easy access to financial services, so they will become the first customers of modern services, and for them will come private individuals. Why is that? It’s simple.
Reason #1 is simplified online lending. Microbusiness critically needs borrowed funds, this will provide an opportunity to expand production, acquire new assets and increase profits. However, traditional banks are very reluctant to contact, considering that the risks of approving applications are too high. If an entrepreneur manages to achieve his own, conditions are not the best.
Small companies are the locomotive of the economy in all countries, so States are interested in their development. And they don’t play an important role for financial organizations. The probability of problems is high, and the profit from such clients is negligible. A person is constantly faced with a huge bureaucratic machine that takes precious time and efforts. Some people have to go to the bank like to their own office to get at least some results.
Fintech development is the key to cheap, fast and convenient borrowing. Services of the new generation will destroy the monopoly of financial organizations, business will gladly turn away from the paperwork in favor of services in two clicks. The size of the enterprise, the amount of its capital, the turnover of money, etc is unimportant for Fintech-sphere. Lending will no longer be a nightmare of entrepreneurship, but will become his reliable friend.
Reason number 2. Ability to control costs. Successful case management involves clear tracking of costs. Hiring a full-time accountant is too expensive, and hiring outsourcers is not always convenient. Thousands of companies closed due to misspent funds. Fintech will come to the rescue of small businesses. Startups develop hundreds of accounting systems, thus solving monitoring problem. Moreover, most services are free of charge, and income is derived from advertisers.
Reason number 3. Simplification of operations between States. Traditional financial institutions make cross-border money very difficult. Huge commissions make transfers simply unprofitable, so people are forced to refuse to expand trade abroad. In the case of fintech services, transactions will take only a few seconds, and additional payments are minimal.
Banks are obsolete, and have become organizations that hinder the conduct of their business, rather than contribute to it. Modern technologies will easily attract the client and help companies develop without spending time and money.