Growing a small-medium sized enterprise (SME) has proven to be a challenge throughout the pandemic, however, the evolution of fintechs has acted as a lifeline in some cases.
Ashley Mallett is the head of B2B growth at Paysend, an integrated global payment ecosystem, enabling consumers and businesses to pay and send money online anywhere, anyhow and in any currency. Mallet has over 15 years experience in the financial services space and lead delivery and execution of Paysend’s B2B product suite. He has formerly led sales and business development teams at Geoswift and Western Union.
Speaking to The Fintech Times, Mallet explains how building a one-stop-shop online ecosystem for financial services can enable businesses to grow and scale more easily:
Technological innovations are facilitating an evolutionary shift in the payments industry. Businesses are looking for ways of processing payments and managing their wider financial needs more efficiently and securely. This is particularly true for smaller and medium-sized companies where streamlined operations can allow them to better focus on serving their customer needs and developing their offerings.
While the digital revolution has enabled a plethora of efficiencies for businesses, many still face varied challenges when handling international payments and broader financial services. These can range from high costs and cybersecurity risks to slow processing times and late payments. For example, a 2021 survey by Time Finance found that one in five SMEs have late payment debt as high as £200,000, while the Credit Protection Association found 51 per cent of UK SMEs were affected by delays in receiving payments for their goods and services.
Perhaps the most significant obstacle for financial services teams – made even worse for leaner teams or solo entrepreneurs – is having to navigate many different providers which don’t talk to each other or connect. While technological innovation is vastly improving the customer experience for individual financial services, whether it’s payroll, banking or FX plug ins, they have yet to be brought together into one unified platform. These frictions are especially cumbersome for SMEs with fewer resources in terms of manpower, infrastructure and budget. At the early stages of growing a business when agility, innovation and speed are paramount, such challenges can have real impacts.
We have seen how the emergence of new technologies is helping businesses to significantly improve B2B payment efficiency. For example, blockchain technology is leading to faster, more cost-effective, and secure international payment processing services, while numerous digital portals, including mobile apps, websites and APIs, are enabling payments and improving ease of access for customers.
The global fintech sector reached $210billion at the end of 2021; as it continues to expand, financial products and services continue to rapidly improve. There is now a clear opportunity to make them work together all under one roof, driving efficiencies and simplifying the financial process for customers. So, the next evolution of addressing customers’ needs is clear: to bring a business’s financial services and products into one platform – a one-stop-shop online ecosystem that caters to all enterprise financial needs, ranging from banking to payments and eCommerce requirements.
To make this centralised model work in practice, and to attract customers to the platform, it needs to provide top rate, tailored client services operating round the clock, with a regular feedback loop. This must be accompanied by a transparent fee structure, fast settlement times and modular, connected products that can work together or operate independently, giving entrepreneurs the flexibility they need to succeed.
Enabling entrepreneurs to thrive
According to the latest SME Finance Monitor, Q2 2021 saw a significant reduction in SMEs expecting limited income in the near future or viewing the covid-19 pandemic as a major obstacle. Just over half (52 per cent) of SMEs said they are planning to grow, up from 24 per cent in Q2 2020. With a more stable few years likely on the horizon, small business owners in the UK are beginning to take advantage of opportunities, while still keeping an eye on threats, whether that’s Brexit, reducing their carbon footprint, rising interest rates, a tough hiring market or the supply chain crisis.
A one-stop-shop online financial ecosystem can offer SMEs fully integrated, affordable and time-efficient financial services. With the benefit of faster settlement speeds, quicker transfers and clear pricing, SMEs can become more confident, nimble and efficient in their operations. This can break down barriers to entry for entrepreneurs and SMEs, so they can develop and grow – ultimately increasing financial inclusion.
Entrepreneurship is all about agility, operational efficiency and profitability. Leveraging existing technological capabilities in financial products and services, alongside the benefits of an ecosystem model, can give small business owners the simple tools, time and financial freedom they need to thrive.