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4 fintech and payments trends SMBs should be mindful of August 14, 2018 by PRBC News

The past few years the financial services industry has been absolutely chock-full with discussions of fintech and all of its possibilities. Small- and medium-sized businesses, somewhat understandably, might have felt just a little bit left out of these conversations, especially when seeing stories of traditional banks and financial institutions beginning to collaborate with fintechs. However, the various advances of fintech don't have to be limited to the biggest banks or companies. 

"Fintech advances don't have to be limited to use by the biggest financial institutions and businesses."

Let's take a look at a few of the newest trends and where SMBs may be able to leverage cutting-edge finance and technology in the near future, including the latest in alternative credit

The emerging possibilities of blockchain
You've probably seen this term thrown around in the business pages of your go-to newspaper or news site. Blockchain is perhaps best known as the algorithm that makes Bitcoin and other cryptocurrencies possible, encrypting each end of a given transaction with a set of data that cannot be replicated and thus not easily pirated. 

The core processes that fuel blockchain, however, don't have to be restricted to cryptocurrency, as Business.com explained. SMBs may, in the not-too-distant future, be able to leverage blockchain transactions to enjoy increased security that makes customers feel like they're in steady hands (and thus helps encourage brand loyalty). Beyond payment processing, the algorithmic language may also be beneficial for leveraging your business's liquid assets and turning them into potentially lucrative investments down the line.

Order invoicing and expenses
SMBs don't necessarily have the luxury of a dedicated multi-person team to handle expense tracking and invoicing. But these tasks simply must be done, or these companies risk losing the revenue lifeblood of their operations.

According to Entrepreneur magazine, there are fintech apps designed specifically to streamline this responsibility for smaller businesses. These include features like mobile document capture for receipts and invoices, simplified payables and receivables, alerts for almost-due or overdue invoices and more. The news provider specifically cited features from Sage, designer of the app, but it's inevitable there will soon be competition from other apps providing similar services.

Alternative small-business loans
Lending is arguably the most notable SMB-friendly fintech advance of the past few years, having emerged in the mid-2010s to address traditional banks' post-2008 lending reticence. Entrepreneur noted that unconventional lenders offering microloans of $50,000 or less have benefited countless small companies, due to factors including more open lending standards and longer payback terms. Interest rates can sometimes be higher, but this isn't true across the board for all alternative lenders. 

Alternative credit for businesses
The various alternative means of financing available to businesses don't just extend to lenders offering loans to company owners. They can also offer these services to their customers as forms of alternative credit, for those who are credit invisible by traditional credit standards - like FICO - but can still demonstrate reasonably financial responsibility.

Using the alternative credit data platform from PRBC Mainstreet, business owners can have data from thousands of PRBC members - individuals and businesses alike. They can then verify that financing applicants have a respectable recent history of day-to-day real-life payments like utility bills, rent checks, student-loan payments, child support and more. This can help business owners accept more applicants and gain more revenue in the long run.