With the post-covid era we live in today, the FinTech industry has seen some fundamental changes which have completely shifted the way numerous businesses operate globally. With mytalu being part of the FinTech revolution, this blog post reflects on the impact of covid-19 on the fintech sector, as well as looking forward to how the adaptions made during that period improved the industry for the better and its potential to adapt well against any future pandemics.
1. Usage differences/Positive impacts
Despite the pandemic causing a global economic crisis across all business fronts, it proved to be more of a catalyst as there was an increase in usage through digital financial services as there was essentially nowhere else to turn to. Furthermore, a number of studies around the changes of FinTech services before and after the pandemic, largely suggest that only a small number of businesses were thriving and with the sudden increase, fintech companies were forced to adapt and overcome.
2. Adaptations made for the better
Due to the financial instability caused by the pandemic, this saw a rise in problems in areas such as delayed payments, getting new clients and insufficient funding for fintech start-ups. However, fintech companies remained resilient and adapted to tackle these issues by introducing new methods, including payment plans, payment protection schemes, and new onboarding processes which led to greater business success and customer satisfaction.
3. Promoting financial inclusion
For the FinTech industry, the main positive outcome to come out of the pandemic was the focus on accessibility as it became a way to ensure financial inclusivity, and this was a huge part of how fintech services managed to face the challenges of covid-19. Additionally, this plays a huge part in one of the many reasons why digitalisation is the way forward, especially with how fast the world is gentrifying in today’s society.
As mentioned, with covid restrictions resulting in companies having to turn to digital platforms, this sparked more of an interest from investors since solutions such as digital payments and payment plans started to take off. This shows further potential for fintech companies and start-ups, as with more funding technology can have a more global outreach no matter the economic state of the country.
5. Ways to prepare for a future pandemic
With the way FinTech services have already revolutionised businesses, they have the potential to be prepared for any future pandemics. Some ways this could be ensured is by businesses continuing to be more and more open to using digital solutions as well as having more adaptable policies as it would largely expand their customer base.
The overall impact of covid exposed how inaccessible certain services were before the rise of fintech and the economic crisis highlighted the need for more fintech solutions to use globally. Ultimately, covid-19 proved to be a catalyst for numerous advances in the fintech sector, showing that globally, we would be more prepared to face any future pandemic as the current growth and expansion rate is better than ever.