2018 was a near record year for fintech funding, with the first half securing $57.9 billion, almost surpassing the current record of 2015’s $62.5 billion. This momentum is expected to continue through 2019. There are three major ways we will start to see businesses benefit from this investment surge throughout 2019:
1. B2B Payments: It wasn’t long ago we started seeing a change in the way consumers pay for products, with more people reaching for a smartphone app to complete payment instead of their physical wallet or checkbook. Now, B2B payers can enjoy similar hassle-free automated payment options. A leader in this market is WorldRemit, which recently closed $175 million in funding and helps facilitate cross-border money transfers for employees and contractors.
2. B2B Lending: Anyone who has ever needed a bank loan knows how rigorous the process is to obtain credit. After banks tightened lending rules following the financial crisis, the space was left wide open for fintechs to use big data and technology to increase finance options. This is now being mirrored in the B2B world. Take, for example, Brex, a San Francisco-based startup that issues corporate credit cards to startup leaders so they don’t have to max out personal cards. It is predicted that there will be a dramatic increase in supply-chain finance options, with banks providing the capital and tech companies bringing parties together.
3. Better Bank Offerings for Businesses: Since 2008, fintechs have been putting a lot of pressure on banks. As more fintechs break into the B2B space, the pressure on banks continues. The B2B space offers larger markets, with higher profit margins, and banks are fighting hard to protect their market share. This translates into better offers for businesses. So while 2019 may be a great year for fintechs, it is business that will be the real winners.
Read the source article at Entrepreneur.
Don’t forget to share this post!