Experienced Corporate Communications Expert Carlton James
Combining new banking concepts and ideas with groundbreaking technology, fintech is revolutionizing the finance industry, with exciting new startups delivering innovative products for small business owners. From payroll to cybersecurity to investment, there is a fintech solution to virtually every problem. Here we look at 10 promising fintech startups to watch in 2021.
1. Spring Labs
Based in Marina Del Rey, California, Spring Labs leverages blockchain and real-time data ledger technology to provide a secure platform for transferring information between businesses. Spring Labs helps its business clients to reduce instances of fraud by validating identities through a range of different products and income stability indicators. The platform streamlines the credit transaction approval process while simultaneously protecting consumer data.
Specifically for e-commerce, tech, and life sciences companies, Brex is a corporate credit card company that offers credit limits 10 to 20 times higher than its rivals. Brex also offers increased reward points on qualifying business purchases.
Brex offers a comprehensive suite of financial services and products for entrepreneurs, including business accounts and spend management. Compatible with a variety of other software products including Gusto, Expensify, Xero, Concur, and QuickBooks, Brex enables clients to streamline expense management and sync expense-related data in real-time.
LendUp is an affordable alternative to payday loans, offering a quick online application process and instant decisions 24/7. The company also offers a series of online tutorials, free of charge, aimed at helping users to boost their financial acumen so that they can make smarter spending choices.
Based in San Francisco, TrueAccord uses the power of machine learning to help companies collect debts in a way that benefits both them and the customer. Instead of sending debt collectors or cold calling, TrueAccord uses modern modes of communication such as push notifications and texts to boost engagement and payback rates.
TrueAccord works with customers who have outstanding debts, providing a customizable payment platform for them to select achievable payment arrangements.
Stripe enables business owners to send and accept global payments. It facilitates payments for both online and in-person retailers, as well as subscriptions businesses, marketplaces, and software platforms.
Stripe helps companies to send invoices, reduce fraud, access funding, issue physical and virtual cards, manage business spend, and much more.
With offices in San Francisco, New York, Seattle, and London, PitchBook is a leading financial data and software company. Serving clients in 19 languages, PitchBook provides comprehensive data on public and private markets to help clients identify and execute opportunities with confidence.
Founded by John Gabbert, PitchBook places customers at the center of an experienced support network that is focused on helping them to make more strategic, data-driven decisions. From onboarding to data analysis to business strategy, PitchBook’s customer success team supports clients through live chat, ensuring they are taking full advantage of the platform to learn best practices and receive additional training and actionable advice.
Based in New York, Riskified is an AI-powered platform that protects e-commerce sites, helping them to distinguish between legitimate shoppers and fraudsters. Riskified provides a variety of different tools, including dynamic checkouts, chargeback guarantees, and alternative payment processing, helping to convert visitors into customers.
The platform’s pre-authorization and ATO prevention solutions fix leaks in e-commerce purchase funnels while simultaneously strengthening customer relationships.
8. Juniper Square
Juniper Square’s groundbreaking software delivers powerful tools specially designed for the real estate industry, simplifying fundraising, investment administration, and investor reporting tasks.
Having managed over 10,000 real estate transactions to date, Juniper Square streamlines compliance, CRM, reporting, data security, and payments, providing an easy-to-navigate investor portal for sharing investment performance data and important documents.
Headquartered in Chicago, Illinois, Morningstar offers an array of services and products that provide everyday investors with access to professional-grade financial information and research, allowing them to make smarter investment decisions.
CEO Kunal Kapoor explores the elements of great investing advice on the Morningstar website, explaining that since its inception, the company has seen how high-quality investment advice empowers investors to reach their investment goals. Driven by high-quality data, Morningstar presents information in an easy-to-understand way, using elegant design to communicate complex ideas.
LendingClub connects individuals and businesses with potential investors. Users can apply for a LendingClub loan in minutes, customizing loan options including the rate, term, and payment options. To date, more than 3 million people have used the platform, securing loans for a variety of different purposes, from medical bills to home improvements to debt consolidation.
Partnering with Accion Opportunity Fund, LendingClub connects business owners with a network of lenders. Offering business loans of up to $500,000, LendingClub provides small business owners with a dedicated client advisor to guide them through the loan application process.
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Just as the Internet changed music and media forever, so technological innovations have revolutionized the finance sector. Once a stagnant industry monopolized by banking powerhouses, finance was ripe for the innovation, growth, and change created by fintech.
In this article, we look at the sudden growth of fintech companies, identifying the different types, and the potential of fintech to change the world of finance forever.
What Is Fintech?
Fintech is a term applied to firms in the finance sector that utilize modern technology to cultivate innovative, pioneering financial services and products. The term is a portmanteau of the words âfinanceâ and âtechnology.â Although it is a relatively recent term, fintech is far from a fad. It is here to stay.
Leading financial institutions are worried about fintechânot so much the relatively modest market share fintechs currently command, but their potential to unseat the worldâs biggest banks in the future. Fintech is changing the finance sector, and fintech companies are already having a considerable impact on the way that both businesses and private clients conduct their financial affairs.
Global investment in fintech tripled between 2008 and 2018, rising from $928 million to $2.97 billion. With fintech becoming an increasingly attractive investment option for venture capitalists, the sector has stratospheric growth potential.
What Are the Main Types of Fintech?
Fintech comes in a variety of different formats, including:
Digital currencies secured by cryptography, making them virtually impossible to double-spend or counterfeit. The worldâs first major cryptocurrency was Bitcoin. Cryptocurrencies are not usually issued by a central authority, placing them beyond the reach of government manipulation or interference.
The lynchpin of many cryptocurrencies, blockchain is essentially a public ledger that records an individualâs online transactions. Information saved on the ledger is shared across a network and cannot be altered or deleted.
Bricks and mortar banking branches are rapidly becoming obsolete, with more and more individuals and businesses transitioning to online banking. Digital banks exist purely online, enabling customers to open online checking and savings accounts, helping clients to complete deposits, transfers, and withdrawals.
One of the newest types of fintech, insurtech companies provide customers with convenient, competitively priced services via accessible, flexible apps.
Paying for goods and services has never been easier. Online payment apps eliminate the exorbitant fees associated with traditional banking services like international money transfers. Whereas some banks charge up to 8 percent in fees for these services, fintech offers faster, more economical options.
Probably the largest category of fintech today, alternative financing encompasses rewards-based financing, equity-based financing, donation-based financing, and debt-based financing.
This fintech subsector includes services such as cloud-based point of sale and software-as-a-service, two cloud-based services that can be accessed 24/7 from anywhere.
A form of fintech that relies on apps and software to help people and businesses to comply with constantly changing, market specific regulations. This type of fintech can also help businesses to mitigate and combat financial crime through fraud detection and cybersecurity.
Built for beginner investors to help with risk and investment management, examples include Acorns, Personal Capital, Wealthfront, and Betterment.
AI, machine learning, digitalized tax platforms, cloud computing, and other technological advancements have helped to automate accounting operations and make them more transparent.
A subsector that leverages technological advancements to reduce the costs associated with international trade, facilitating trade finance and increasing transparency in trading operations.
The range of fintech applications is diverse and continually growing, with massive advancements in several subsectors, notably blockchain, digital banking, and insurtech. The fintech industry is constantly evolving, growing ever more efficient and effective, integrating a variety of financial products and services across many financial sectors, reaching out to an ever-increasing number of consumers to satisfy their changing needs.
Fintechs have continued to disrupt traditional banking, presenting new, innovative concepts which are having an increasingly significant impact on global finance and the way that people and businesses conduct their financial affairs.
Ever since the 2008 Global Financial Crisis, fintechs have continued to spring up all over the world, gaining popularity for a number of reasons, some of the most common being distrust of financial institutions following the banking crisis and anger at inequities associated with the traditional banking system.
Technological innovations have fundamentally changed our relationship with banking in the same way that the Internet disrupted the music and media industries. Today, people routinely organize their finances via their smartphones, with fintechs delivering cheaper, faster, more convenient services.
With the financial services industry monopolized by big banks for decades with little to no competition, fintech has provided an alternative, often incorporating cheaper rates and more transparent pricing. In order to stay relevant, forward-thinking banks are investing heavily in financial technology, improving their own digital armories and presence, providing clients with a comprehensive range of online services to make banking faster, easier, cheaper, and better.
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Carlton James has more than 35 years of experience in corporate communications and has worked across South America, Africa, and the Caribbean. Currently a director at the Guyana Bank for Trade and Industry (GBTI), Carlton James chairs the Marketing Committee.