The Future of Small Business Banking
April 5, 2018
Many small business owners would agree that banking is a necessary evil. Today, it’s impossible to run a business without a bank account.
But as we pointed out in our article Why Large Financial Institutions Aren’t Built For Small Businesses, the services of big banks simply aren’t tailored for the needs of small businesses.
Small businesses form the backbone of US economy
And yet, small businesses form the backbone of US economy. Their banking needs should be catered to, and if big banks aren’t up for the job, something else will step up to fill that void.
In fact, it already has.
Small Business Today
As Frederick Crosby’s article Then, Now, and the Future of Small Business underlines it, we live in a golden era for small business. Many new opportunities present themselves to small business owners, but these also bring challenges.
Small businesses struggle with lack of funds and outdated, costly wire transfer processes that may even ruin their business altogether.
Many of these challenges are connected to money. How can small businesses raise sufficient funds for their operation? Is there a way to send quick and trackable overseas payments at a reasonable cost?
Unfortunately, the current banking system doesn’t provide a suitable solution to any of these issues. Small businesses struggle with lack of funds and outdated, costly wire transfer processes that may even ruin their business altogether.
How to escape from this trap? By turning to alternative financial solutions. Also known as FinTech.
What Is FinTech?
Financial technology is a relatively new phenomenon. It encompasses various innovative ways to provide financial services with the help of groundbreaking new technology, like blockchain.
FinTech companies strive to come up with new solutions that disrupt the old and outdated financial industry. FinTech services range from international payments to investments and insurance, and everything in between.
And why is it good for small businesses?
The Future of Funding
If you’ve ever tried to get a bank loan for your small business, you know that it’s not as easy as it sounds. In fact, 80% of small business loan requests are denied by banks.
But thanks to FinTech, this is about the change. Companies like BlueVine offer a credit line of up to $200k to small businesses. In addition, you can also ask for invoice factoring, which means that you get an advance from the company on your outstanding invoices.
BlueVine promises fast services: you can get your cash in one business day.
There are other options as well, like crowdfunding. Companies like Kickstarter, LendingClub, and CircleUp offer various types of crowdfunding that can help you raise the necessary funding for your latest business projects.
The Future of Banking Processes
Having an actual bank account is (yet) inevitable for small businesses. But, thanks to FinTech, there are various banking processes they don’t need to suffer through anymore.
Like international transfers.
If you’ve ever sent an international wire transfer through your bank, you know that it takes a lot of time and money. The process is riddled with hidden fees levied by unseen intermediary banks that forward your payment to its destination, and uncertainties about timing and security.
If you’ve ever sent an international wire transfer through your bank, you know that it takes a lot of time and money
The whole thing is like a big surprise party, except the joke’s on you. You don’t know how much money will arrive and when. And if any of the intermediary bank messes up, even the “where” is in question.
But it doesn’t have to be this way.
The next time you need an international transfer, choose Veem.
Veem is a global B2B payments network, allowing you to request, send, and receive international payments with just a click. Veem allows you to track all your payments, which means you’ll know exactly where your money is and when it will arrive.
You need 7 tools to master international trade. Find out what they are.
In addition, Veem charges no wire fees and offers competitive foreign exchange rates, helping you to save time and money. All of which you can spend on strengthening your business.
Sign up for a free Veem account to click, save, and grow.