How FinTech Companies Help Startups to Grow?

Soniya Khanna

06 Jul, 2023

India ranks second for having the largest number of FinTech companies globally with the United States on the first spot. FinTech companies help small business owners and startups by providing them with credit and technological advancement. In this blog, we are going to dig deeper to know how FinTech companies help these businesses.

What Do FinTech Companies do?

FinTech is the abbreviated form of Financial Technology is a range of financial services software that is used by companies to automate traditional financial methods. These are the examples of technologies which make financial services more assessable to the general public; smartphones, mobile banking, investing services and cryptocurrency.

These are some of the ways a FinTech company benefits small businesses and startups;

• FinTech corporations provide funds to startups without much hassle. Traditional banks used to demand various documents, their processes were complex and also, they used to take too much time. Startups obviously couldn’t afford that introduction of FinTech corporations surely has decreased this problem
• These companies provide online solutions to accept payments, send invoices, and pay creditors which enables users to do all these activities even when they don’t have a merchant account or an expensive card payment accepting machines
• These companies allow the merchant to make multiple payments at a time and also makes sure these tasks are done with compliance with anti-terrorist, banking, and other payment regulations
• FinTech companies now facilitate to make the processes easier by allowing the consumers with an option to write checks online
• These companies have come up with a service technology called “Check” which helps business owners with an option to manage all their bills in one place. Moreover, these technologies also ensure that the payments are paid in time

Top 20 FinTech Companies in India

India has the second-largest number of financial technology companies {FinTech companies}. Our country has over 2000 FinTech startups and 42 percent of them are situated in Bangalore and Mumbai other is located in New Delhi, Gurugram and Hyderabad. Until 2018 there were 730 functional FinTech companies that grew from the year 2015-2018 and 1300 more FinTech startups were added in the Indian FinTech companies’ ecosystem.  Some of the top FinTech companies in India are;

• Mobikwik: is a digital wallet service that enables our mobile phones to make phone recharges, bill payments, and online shopping
• Policy Bazaar: is a portal which brings unbiased comparison of financial services of top insurance companies
• Paytm: is a payment processor especially built for Indian mobile shoppers
• phonePe: is an app which is used to transfer money online
• PayU: is a mobile wallet
• Kissht: is a lending platform that specifically offers personal platforms for purchasing electronic gadgets, kitchen appliances, furniture, etc.
• Subh Loans: is a Mobile Money Lending startup which makes loans accessible to underserved and un-served
• Lending Kart: it provides with a platform for users to evaluate the borrower’s creditworthiness and other related platforms
• Faircent: is India’s first P2P lending platform especially for receiving the certificate of registration {CoR} as an NBFC- P2P from Reserve Bank of India {RBI}
• WonderLend Hubs: provides credit gateway solution to the urban and new-to-credit public so that they can enable zero-friction credit assessment

• ExpressMOJO: this startup focuses on developing a technology platform for improving access to information and credit to help small fleet owners and single truck owners to grow their businesses
• Pine Labs: provides Point of Sale {POS} solutions to simplify the payment acceptance and creates business opportunities for issuers, merchants, and brands to connect with customers
• Freecharge: is a platform for making prepaid, postpaid, DTH and electricity bill payments
• Capital Float: is an online program that issue working capital finance to SMEs in India
• Aye Finance: is an NBFC which provides loans to MSMEs in India
• Acko General Insurance: is a digital insurance company
• Mswipe: is a mobile add-on which enables the smartphones, feature phones and tablets to accept bank and credit card transactions
• Bank Bazaar: is a digital financial products marketplace for getting instant customized rate quotes on loans and insurance products
• Paisa Bazaar: is a digital market place for getting the loan, credit card, and other investment products in India
• Pay Sense: is a FinTech startup that provides loans and credit options in the range from Rs. 5000 to Rs 1 lakh using the web or mobile platform

Suggested: Growth Aspect of Fintech in India

How FinTech Companies Help a Startup Grow?

FinTech companies develop technologies that allow business owners to manage and control actions like accepting payments, paying bills and using other financial services to their advantage. Earlier with the lack of these technologies and other facilities provided by FinTech, startups didn’t have many ways to grow their businesses.

Furthermore, they only had banks as a source of capital which used to look for the credibility and the scope of these companies in the future market. This made the process more complex and difficult for a company that is in its initial stage. With the FinTech solutions in the market, the startups now have more options and ways in which they can work towards growth.

Importance of FinTech Companies

However, it is hard for startups to grow and make a reputation in today’s world with all the competition and a large number of startups launching every year. Hence, it is important for them to opt for ways that bring ease in their functioning and help them grow effectively/efficiently. FinTech companies play a major role in this. Mentioned below are some of the importance of the presence of FinTech solutions in the (modern) market;

It includes technologies like

• Crowdsourcing and crowdfunding
• Online payments(on mobile and PC)
• Peer-to-peer transfers
• Micro credits and loans
• Cryptocurrency

Advantages of FinTech are;

• Anyone having internet connection can access FinTech solutions all over the world
• FinTech solutions are comparatively cheaper than their counterparts
• Cryptocurrencies like Bitcoin use various technologies which make it more secure than traditional banks. Also, the transactions are anonymous
• Moreover, the usage of various technologies make the process in a company automated
• Furthermore, these systems are flexible in nature as they do not demand too many documents and they provide lending to new and very small businesses
• Also, the use of modern technologies add to the reason for startups choose for them
• Henceforth, FinTech companies provide with a better customer experience

To Conclude

FinTech companies are companies that provide funding to startups and small companies. They ease the process of managing a business by using automation technologies, less documentation, providing lending, expense tracking and invoicing, usage of various tools, and by providing a range of FinTech products and services. These services help startups to grow.