Why Startups Need to Think Beyond Traditional Banking for their Financial Operations
“Consumers don’t like traditional banking methods anymore”, said the Founder & CEO of a renowned United Arab Emirates digital crowdsourcing firm. Well! the comprehensive financial landscape of the world is in the middle of a worth-watching parallel shift — and, all thanks to young and successful fintech startups which expansively transformed consumer’s relationships with the money by providing reliable alternatives to traditional financial operations.
Financial Technologies — the Future of the Banking in India
While the United States of America is the leading nation by the total number of startups, the UK got the third spot after India being the second huge abode of efficacious startups. So, there is absolutely no doubt that India has become a quintessence of modernization with a total of 9,300 unicorns.
But in this constantly evolving era of IPOs and Unicorns, don’t you think that it’s easy for people to get caught up in the surging stories of startup failures, since nothing scares them but “catastrophe”. So, what could be the possible reasons for a promising startup failure? Lack of capital, non-alignment of founders and investors, business model, lack of trust, or money-management?
Although market need and non-alignment of founders and investors are the commonly traced reasons for the failure of promising businesses, knowing how to manage “financial challenges” topped the list.
If you sit closely with the new founders and entrepreneurs, you’ll see how they often struggle to pay for their unanticipated outlays even after creating a proper financial projection and clearing due diligence.
So, what’s the catch here for the entrepreneurs? Well! in any new business, even a small expense which is not included in the business budget can cause huge glitches in making Payrolls or paying the bills. Thus, startups must think beyond traditional banking for their financial operations.
And, when it comes to thinking beyond sourcing capital for day-to-day expenditure, new-age banking which is “neo-banking” comes into the role.
FinTech has amplified in scope
With covering an array of financial services, this modern banking alternative can be outlined into 5 key areas: consumer edges, security and monetization of data, infrastructures and payments, risk management and internal operations, finance and investment.
Unlike traditional banking methods, a Ne0-bank doesn’t ask you to sit and spend your precious hours on simplifying things such as navigating a buggy software or understanding an intricate infra-system.
In simple and sorted worlds, Neo-banks are here for the long run and can probably be the biggest asset of FinTech.
Neo-Banks — The modern way of banking Explained
Bridging the gaps between evolving demands of customers and services that banks provide, Neo-banks have a huge role in keeping the Fintech companies a step ahead of traditional banks.
Here are some benefits of Ne0banks that new and budding startups can seize to grow:
- Transparency
The infrastructure of Neobanks allows them to stay transparent in this digital age, providing real-time alerts and clarifications of any penalties and charges sustained by the customers.
2. Satisfactory customer experience
With personalized and hyper-enhanced banking services, neo-banks provide efficiency and ease to their customers in banking services, for instance, treasury services, budgeting, ML (machine-learning) and AI (artificial intelligence)-automated treasury, budgeting and accounting services, real-time international payments, quick chatbot supported customer services, and unified account creating.
3. Easy-to-use APIs
Neo-banks offer easy-to-operate and organize APIs to consolidate banking into the payment and accounting infrastructure.
4. Automated services
Along with offering basic and necessary banking services, neo-banks also provide near real-time and automated reconciliation and accounting services for profit & loss records, balance sheets and bookkeeping on mobile platforms at affordable prices.
UpShot
Whether you’re a small or big startup, without any second doubt, reconsidering your banking style for your financial operations is a necessity of the time. In the initial year of operations, you can’t even imagine thriving without adapting and evolving. And, when it comes to evolution in banking, Neo-banking is the cutting-edge, super-fast, transparent, efficient and affordable way of managing your financial operations.
