Today, technology has transformed to a point where managing business finances has become simpler, safer, and more reliable. From AI-driven lending solutions to digital money taking over, the future of digital transactions looks promising and exciting. So, if you are here to learn about how digital transactions are revolutionizing how businesses handle finances, you have come to the right place. In the article below, we will explore a few digital solutions that every business owner needs to keep an eye on.
Digital Business Loans & AI-Driven Lending
One of the biggest challenges small businesses face is getting enough capital to grow. While these small businesses still contribute to the economic boost, traditional lending methods such as bank loans have strict policies. These policies not only make applying for the loan a tedious task, but getting approval is a whole new struggle. This is the reason why small businesses and startups often have difficulty in getting business financing, especially if they have a low credit history.
Therefore, in recent years, AI and machine learning have revolutionized the lending industry. Unlike traditional lending solutions where banks approve loans based on credit history, AI uses advanced algorithms to consider other critical factors to evaluate real-time risk. In fact, many online mortgage lending companies like Amerisave are leveraging the technology to assess the risks and check for loan eligibility. Thanks to AI-driven lending solutions, these companies have made business financing much more effortless, more reliable, and more accessible for businesses.
Open Banking
Open banking is another innovative and reliable way for businesses to manage their finances efficiently. It has completely transformed how companies manage their finances and conduct financial transactions. How does it do that? It comes as no surprise that your bank holds all your financial information, from your cash flow to invoicing and credit costs.
So, open banking allows you to share this data securely with authorized third-party providers such as banks and fintech companies. Using that data, these companies can find the best products, services, and apps to help you monitor and understand your finances better. It has enabled companies to be more profitable and productive without relying on traditional banking systems. Among many other benefits, open banking allows businesses to improve financial management, track expenses, and enhance the overall payment experience.
Central Bank Digital Currencies
In recent years, we have seen the most significant change in business finances with the introduction of the central bank’s digital currencies (CBDC). Unlike traditional currency, which you need to carry everywhere in your wallet, digital currency is available on your phone in the digital wallet. But how is this shift benefiting business finances? The answer lies in the secure, fast, and simplified digital payment system.
For starters, whether you want to make a local or international transaction, CBDC allows you to do so within minutes. This has helped businesses simplify and streamline their finances like never before. One of the biggest drawbacks of using traditional methods was the considerable transaction fee businesses had to pay. Thanks to CBDC, businesses now do not have to rely on intermediaries, hence significantly reducing transaction fees.
