Fintech Redefines How SMBs Tackle Cash Flow Challenges


Cash flow has never been more critical for small businesses as economic factors such as inflation and supply chain challenges have quickly become an emerging pain point. In light of these challenges, small businesses are increasingly turning to fintech solutions to help, and the industry has an incredible opportunity to deliver money movement innovations to fuel their success amid these headwinds. 

The adoption of technology was accelerated by the pandemic, with reports from McKinsey in early 2020 noting that in a matter of weeks we catapulted forward five years in both consumer and digital adoption. As technology continues to play a pivotal role, here are three areas fintech will continue to redefine as the industry looks to drive greater small business outcomes.

Truly Integrated Money Management

During the pandemic, we saw increased demand for mobile payment offerings as consumers changed the way they wanted to pay. The ability to get paid quickly became even more critical and according to a QuickBooks survey, during the pandemic, 46% of businesses began processing contactless payments and nearly a third (30%) began processing payments using mobile payment apps. With these new payment methods taking hold came an increased need for greater access to integrated money management and cash flow forecasting abilities. And that landscape has not changed with current macroeconomic pressures continuing to test the resilience of small businesses and reinforce how essential it is for them to remain nimble and have the right cash flow tools at their disposal. 

Together, these shifts have created an even greater demand for financial services that are truly integrated and deliver comprehensive visibility of a small business’s financial health. This includes faster money movement services like instant deposit, forecasting capabilities like a cash flow planner, and on-demand capital. Individually, these are all incredible innovations that can save business owners time and give them greater financial clarity, but the true power lies in how platforms can connect these services to create a truly cohesive money experience that spans payments, banking, and lending.

As fintechs look to the next phase of addressing money movement challenges, advancements and offerings that enable faster money movement in an integrated and embedded way will truly allow small businesses to be agile in a rapidly changing world.

Accessing Capital

As entrepreneurs face today’s macroeconomic hurdles, access to capital is often a vital tool in helping support a business’s survival. Unfortunately, many small businesses can face challenges when looking to secure a loan from a traditional financial institution, creating a gap in access to capital. This can be a major roadblock on the path to healthy cash flow when a business is looking to buy additional inventory, purchase new equipment, or hire additional employees. 

Fintech platforms have led the charge in rethinking how small businesses can access capital, and providing greater availability to businesses who have struggled to get a traditional loan, utilizing data and insights to better understand the financial health of a business to introduce loan offers more quickly and at the most critical points in their business journey. Innovative products are helping to bridge the cash flow gap by allowing businesses to tap into invoiced funds faster with an advance. Continued advancements in this space have the potential to unlock even greater access to and efficiency in securing capital, delivering funding at key financial moments business owner’s face every day and eliminating cash flow hurdles.

Waiting to Get Paid

Waiting to receive cash that’s been earned can be one of the greatest struggles for a small business owner. And it’s an issue that spans B2B and B2C payments, with business payment terms for invoices at net 30 days or more, and 38% of small businesses reporting being paid late regularly by their customers. Today, businesses can help mitigate these challenges by diversifying their payment offerings with solutions like mobile and online options. But in the future, advancements in technology will continue to eliminate manual aspects of payments and paper checks, and the unnecessary payment lags that can lead to cash flow headaches. 

Today’s small businesses have faced no shortage of challenges, but fintech innovation has undoubtedly helped give many the confidence and optimism that fuels their resilience.  At this inflection point, fintech is perhaps better positioned now more than ever to deliver offerings that reimagine how finance works so that it works best for small businesses and allows them to effectively manage their cash flow with ease. If we do, we’ll power not only small business success, but fuel the growth of our economy. 


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