A Look At How Evolving Fintech Is Powering The Growth Of The Alternative Financing Industry

1. A Look At How Evolving Fintech Is Powering The Growth Of The Alternative Financing Industry

2. The evolution of fintech has brought in a revolution in the financing industry. The fintech industry is creating disruptions in the way people did business even a few years ago. But now its growing power is helping the alternative financing industry flourish as well. Although still in a budding stage, the fintech industry has already made a significant impact in the alternative financing industry.

4. The effect on the alt-lending industry is so profound that over the last decade, the two terms - fintech and alternative financing - have almost become synonymous. Alt-lending institutions powered continues to deliver different financial channels powered by technology, specially harnessed, to serve the financial industry.

5. Technological innovations such as AI, machine learning, and cloud computing have been critical for the success of fintech and has contributed to the climbing growth rate of the financing industry. This, in turn, has benefitted both the lenders and the borrowers.

6. While lenders are looking for a uniform process to scale their business by leveraging technology, borrowers are leaning more towards alternative financing because it is fast. The user-friendly portals and the ease of submitting documents are encouraging more borrowers to favor alternative financing. Once all the information is submitted online through portals or emails, they get checked and verified at the back end through automated systems.

7. Why are small business owners leaning towards alternative financing? The fintech the revolution has brought alternative financing into the limelight. Since most of the alternative finance lenders leverage technology to underwrite, the process is much faster than a traditional funding system.

8. Because most of the processes are technology-driven, approvals happen at a much faster rate. For example, Cresthill Capital offers funds as quickly as 4 hours or up to 3 business days after the submission of the application. Alternative funding does not work on stringent guidelines. Hence, SME owners who are looking for cash flow to boost their businesses find alternative funding more convenient. Easy and accessible cash makes it faster for small businesses to scale up. For example, Cresthill Capital reviews confirm stories of many small business owners who have benefitted from their cash boosts to grow their business.  

9. Different types of alternative financing options In the world of Alt-fin, one size doesn’t fit all. Fintech has made it easier for alt-lenders to build and manage different funding options to suit different business scenarios and requirements. Here is a quick glimpse at different alternative financing options:

10. Merchant cash advance:  It’s an advance on your estimated future earnings. The advance is paid back with a predecided portion of your daily sales. So, the payback amount is flexible, which depends on your revenue along with a small lender’s fee.   Equipment financing: This is pretty straight forward. If you need any equipment to grow your business, you can get equipment financing for a 100% down payment.

11. Invoice financing: Also known as account receivable financing, it is a popular alternative mode of financing that gives you advance on the money, you are owed. This means you don’t need to wait till the month-end to receive money from your customers. The bottom line: Is that most of the advantages of alternative financings - such as speedy processing, flexible offers, hassle-free approvals - wouldn’t have been possible without specialized technological interventions. The rise of fintech has mirrored the advancement of the alt-lending industry. The ultimate effect is that capital is now available to everyone

12. If you are a hard-working business owner with a profitable business, then there is no reason why - with alt-fin - you can’t get hold of capital to grow your business further! What are your views on the role of technology in the financial sector? Do you think fintech will evolve further, and will the borrowers see a further benefit? Do tell us what you think in the comment section below.