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Introducing Property-Secured P2P Loans

For the newbies, debt crowdfunding is a concept where borrowers (usually SMEs) approach a crowdfunding platform for loans funded by a pool of investors. Investors earn interest, paid by borrowers, as returns on their investment. Investments are open to individuals as well as corporates with a minimum amount going down as low as $50 for smaller loan amounts.

Funding Societies, licensed and leading crowdfunding platform in Southeast Asia, backed by SoftBank Ventures Korea and Sequoia Capital, has recently introduced Property backed Secured Loans to its pool of more than 50,000 investors, providing them with more diversification opportunities. This is the third product Funding Societies has introduced since Business Term Loans and Invoice Financing.

What are Property backed Secured Loans?

Property backed Secured Loans are loans taken by companies who have pledged a local property as a form of collateral against the loan. These are local properties owned by the companies and/or Directors of the companies, and can be Residential, Commercial or Industrial. The loan amount is capped at 70% of the property value determined by independent valuers.

As an investor, you can start investing from $1,000 in this secured crowdfunding product.

Why should you be excited about this product?

It is secured by property as a collateral: Funding Societies (FS) takes the first charge on the property, i.e. In the event that the property needs to be liquidated to repay the loan, FS will have the first right to access the cash after it is auctioned. Given the 70% Loan to Property Value (LTV), there is enough buffer against fluctuations in market prices that result in properties being devalued.

It’s a short-term investment: The loans are typically up to 12 months’ tenor.

Fair returns for a lower-risk product: You can get up to 8% p.a. returns in your investment.

Additional Diversification: Existing crowdfunding investors now have a secured loan product to further diversify their portfolios. New investors who have not invested in crowdfunding can take this opportunity to start investing.

What happens if a borrower misses out on repayments

In the case of repayment by borrowers, FS will liaise with borrowers on behalf of investors for collections. If the loan reaches defaults (defined as 90 days past payment due date), Funding Societies will pursue legally to auction the collateralized property. Proceeds from the auction will be used to repay the investors and any excess will be returned to the owners of the property.

In the rare scenario where proceeds from the auction are insufficient to repay the loan, Personal Guarantors (usually Directors of the company) and the borrowing company will be liable for the outstanding due.

TL;DR (Too Long; Didn’t Read)

Given that there is collateral security in the form of a property, Property backed Secured Loans become more secured and typically lower risk compared to other crowdfunding investment products.

For those with a lower risk appetite but still want to potentially earn a return of up to 8%, the Property backed Secured Loans is a product for you to diversify your portfolio in.

Limited Time Promotion: Receive $20 Cashback!

From now till 15 June 2018, sign up as an investor and invest at least $1,000 to be eligible for the $20 cashback. That’s an upfront 2% cashback on your investment!

Here’s how to claim the cashback:

  1. Sign up for your new investor account on www.fundingsocieties.com.
  2. **IMPORTANT!** Enter MDMAY in the Promo Code section.
  3. Complete your registration and activate your account.
  4. Invest at least $1,000 before 15 June 2018. Investment can be in one loan or across multiple loans.

Eligible investors will be notified via email of their within one month from the end of the promotion.

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Business

How Startups And SMEs Can Use Fintech To Fuel Growth

The financial technology (FinTech) field grew and developed rapidly as a response to the financial problems we face, from making financial information more accessible to addressing the lack of financial inclusion in various countries. Small and medium-sized enterprises (SMEs), in particular, can benefit from the digital solutions offered by FinTech. For instance, FinTech offers e-payment and bookkeeping services that SMEscan take advantage of.

But most of all, FinTech can provide business financing solutions for SMEs. The growth of any small and medium-sized enterprises (SMEs) is dependent on the health of their finances, especially on having the appropriate funding. Certain business models within FinTech, such as peer-to-peer (P2P) lending, can be an alternative source for SME working capital loans.

FinTech as an online financing platform

To grow, SMEs need working capital. SMEs often choose to apply for loans to finance their business development. However, traditional financing products can have regulations, criteria, and processing time that are incompatible with SME needs. Often, requirements for collateral can stop a promising SMEs from getting the financing they need.

FinTech models such as peer-to-peer lending offers a solution: by building an online financing platform for SMEs. Since it is online, the application process tends to be faster and simpler. Certain P2P platforms also have apps and a small business owner can easily apply for financing through the app. The loan product also keeps SMEs in mind, with no required collateral.

FinTech as an accounting and bookkeeping service

Small businesses sometimes neglect the importance of accounting, even though it is crucial for any company to stay aware of their financial condition. Well-managed financial statements will help SMEs identify problems they are currently facing and how to bring the company to a better, more profitable place. Sometimes, small businesses simply lack the capital to hire an accountant.

These days, some FinTech platforms provide accounting technology to help manage SME financial statements. The platform also allows SMEs to have an easier invoice and payment process. Many of these accounting services are based on cloud servers so business owners can access their data anywhere, anytime.

If you do use cloud-based service providers, remember to implement the appropriate safeguards. Read more on “How to Protect Your SME from Cybercrime”

Fintech provides electronic and digital payments

FinTech digital payment solutions, such as online and mobile payment options, along with multination and multicurrency options will help businesses gain a simpler way to manage financial transactions. The electronic and digital payments solutions will especially help small businesses sell their products and services to a wider audience than if they were only dependent on cash.

Digital solutions and innovations pioneered by FinTech bring great impact for SMEs. By utilising FinTech innovations, SMEs will more easily adapt to the digital age and grow their operations.

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Career

3 Tips You Can Use For Expanding Your Professional Network

Ask any business owner and they will tell you how important it is to build a solid business network. A great business network is high-quality and consists of a group of people you can count on. Building such a network requires commitment and consistency. Not to mention, a balance between giving and taking, not simply exchanging business cards and contact information. Here are 3 tips for building a better business network:

Be Authentic

When introduced to new acquaintances and businesspeople, it’s recommended to be knowledgeable and up-to-date. But it’s more important to be yourself. Sure, we all want to present a more refined and polished version of ourselves to the world, but it’s another thing altogether to mislead acquaintances about your goals and values. Understandably, there are many people we would want to impress, but the best relationships (yes, business relationships too) happens when you start with a natural connection and common ground. Being authentic also enhances your reputation to others in your field.

Bad Behavior Is Never a Good Idea

We hear of several charismatic yet overbearing and unpleasant business leaders. We start to wonder if such traits are perfectly acceptable, or worse, integral to success. Please don’t try this.

Being a jerk while taking benefits from your relations and not giving back is detrimental at any stage, but especially so when you are in the process of building and growing your business. You will get an unsavory reputation and trust us, your network will pass on juicy anecdotes of nasty behavior to their relations.

Thank your acquaintances when they have provided you a favor. Be kind to them even when it looks like there is no visible payoff for doing so. Being trustworthy and dependable has business value.

Get More Personal

Want to know a particular person better? Ask them to hang out together. You’ll have the chance for a more personal discussion. Be open to different ideas. Be willing to have someone teach you business models you may be skeptical of. Share your experiences, points of views, and professional plans to see if this is someone you want to share a more lasting business relationship with. Also, see if this is someone you can trust.

Building a solid business network doesn’t stop at exchanging contact information. It’s what happens after that matters most. Be authentic, be professional and responsible, and establish quality relationships with talented people who trust and inspire.

Looking for more business tips? Click here for how to maximize business productivity and here for ideas on growing a small business.

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Business

Importance Of Creativity And Innovation For Startups And SMEs

It has become widely accepted that creativity and innovation are crucial to business success, especially in the ever-changing and uncertain world we live in today. While creativity is the ability to produce new and unique ideas, innovation is the execution of that creative ideas.

When properly fostered, creativity and innovation create inventive problem solving for your business or your audience. Think of technological innovations! They solve day-to-day problems and make life more convenient for all.

The same rule applies with business innovations. Creative and innovative problem solving can make your company run more efficiently. They can also make a name for your business and create the competitive edge all businesses strive to achieve.

The importance of creativity and innovation in SMEs

Without creativity and innovation, companies would be stuck in a rut. They would utilize the same marketing/promotion campaigns, business strategies, or maybe even sell uniform products and services. But once your business brain is able to think creatively, the possibilities are endless.

By being creative, your business is more likely to become innovative. And by being innovative, your business is more likely to offer something new, making you a step ahead of others in the industry. Encouraging business creativity pays internal dividends as well. Your company gets a variety of ideas for problem solving and staff becomes more engaged.

A UK study shows that employees are most productive when they are challenged by interesting work and allowed to implement their initiatives. Too many rules and procedures, on the other hand, stunt productivity. In other words, giving employees opportunities to innovate pushes business productivity and agility.

Empowering SME creativity and innovations sounds like a tall order, but innovation comes in many forms, not just cutting-edge technology and design. For many service-fed industries, this simply means meeting customer demands, going the extra mile, or approaching your market in a different way to competitors.

How can you implement creativity and innovation in your business?

For SMEs looking to encourage innovation from within, the answer is to not limit yourself to your organization. Collaborating, sharing knowledge, and broadening your network fill your business with fresh ideas and help improve your business’ growth prospect. Of course, take care to keep internal data private, but exposing yourself and your staff to external connections adds to your repertoire of knowledge and ideas to explore. Outside connections can also provide objective feedback to your ideas.

Internally, you can push creativity and innovation by intellectually challenging yourself and your team. It’s important that your team is sufficiently challenged. Too little of a challenge will cause boredom, but too much will cause stress. Find a healthy balance to help them sharpen their creative minds.

It’s very clear that creativity and innovation are advantageous for your business. Innovation provides a culture of creative thinking that enables you and your team to think outside the box and come up with new and interesting ideas.

This article was written by Funding Societies, Singapore’s leading peer-to-peer (P2P) lending platform. We provide working capital loans for small and medium-sized enterprises (SMEs), along with attractive investment opportunities to the broader public. To learn more about us, click on our website here.

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Business

Building a Business: Online or Offline?

When thinking of how best to build your business, a major consideration these days is whether to make it offline or online – especially, of course, if the business idea you have in mind is in the retail industry. Each option has its ups and downs, so you need to contemplate it very carefully.

In the digital era, it seems easier to build an online business because of the advanced technology (and of course, the promise of cheaper overhead costs). But that doesn’t mean brick and mortar shops have lost their merits.

For those of you who are about to build your very own business, here are some points to consider before deciding which type suits you best.

If You Want to Build a Brick and Mortar Shop

An offline store looks and feels credible. Whether or not customer behavior is rational, the presence of a physical location has the advantage of more readily gaining trust. People know that the business is physically present should there be any issues with its goods and services. Besides, who hasn’t heard of fraudulent online sellers? There are also certain products that customers would want to check directly before purchasing, such as cars and electronics.

However, when it comes to brick and mortar shops, keep in mind that you do need to spend a lot more money on its infrastructure and upkeep. You also need to spend money on manpower, such as a manager or supervisor and a few people as staff. In addition, you will need to take care of paperwork ranging from operating license to legal documentation so you can legally run your business.

If You Prefer Online Business

Today’s age offers many possibilities for online enterprises. Not only do they offer advantages for the customer, they also benefit owners.

As most would already know, online stores and digital businesses are relatively cheaper than offline businesses. You don’t need a physical location as everything can be handled through the Internet. Many overhead costs (rent, maintenance, utilities, total salary) can be cut by having your business move online. People can simply shop from anywhere in the world and wait a few days until their order arrives (that is, if the online business offers international shipping!).

However, online business relies on Internet connection and a functional platform (your business website or mobile app or social media page). If your company’s online medium slows down, has issues, or is frustrating to use, your business will suffer.

Moreover, online business has no set operational hours. Some people find this an advantage, as they can respond to customers anytime and anywhere. But bear in mind that in the digital age, everyone is impatient. Your social media page might be scrawled with complaints if your response is an hour late.

As you can see, whether you build an online business or an offline one, each has its pros and cons. What usually happens these days is to start with an online business. When your company has become more recognized and has started earning profit, you can plan its expansion to a physical location. In fact, many, if not most, successful businesses are a mix of online and offline. Good luck in your business endeavors!

This article was written by Funding Societies, Singapore’s leading peer-to-peer (P2P) lending platform. We provide working capital loans for small and medium-sized enterprises (SMEs), along with attractive investment opportunities to the broader public. To learn more about us, click on our website here.

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Business

How To Plan A New Business Or Side Hustle

All successful businesses start with great planning. Business plans can be a daunting challenge for some, because of the effort you have to put to craft one. As daunting as it seems, business plans are necessary as they provide the roadmap for where you want to take your company. In other words, a well thought-out business plan is a vital requirement for any entrepreneur or business seeking to increase chances of survival.

But how do you write a good business plan?

Figure out what needs to be there and what doesn’t

Start off with a basic outline that will make sense to investors or whoever it is you are offering your business plan to. Write about your understanding of the market, the unique selling propositions of your product or service, the business model, and data that proves there is demand for whatever you want to create. If possible, show that you have the team and resources to help you in this business journey. If you don’t, write down what resources and how much money you need to be able to reach your destination.

You can build off the above with more sophisticated aspects, such as:

  • Company Analysis
  • Industry Analysis
  • Competition Analysis
  • Customer Analysis
  • Marketing Plan
  • Management Team
  • Operations Plan
  • Financial Plan

Research, research, research

Now that you know what needs to be included in a business plan, you need to start doing your homework. Find and curate as many resources as possible, monitor your target market on a regular basis, and keep track of competitors’ new launch or strategy.

Investors reading your business plan will want to see that you’ve thought long and hard about the potential of starting or expanding your company, along with the challenges ahead and how to rise above them.

For entrepreneurs who intend to use their business plan to get an investment, you also need to research your potential investors. Understand the way they work, take a look at their portfolio, and see whether there are any similarities with your business.

Have proof to back up every claim you make

Want to know why research is so important for business planning? By conducting thorough due diligence, you will have proof to back up every claim you make.

Let’s say you claim in the business plan that your product will be the leader in your field by six months to a year. You will need to detail why you think so. If you say your management team is fully qualified to make the business a success, you should make sure their resumes demonstrate the needed experience.

Be realistic with available time and resources

What’s most important about a business plan? Whether or not the steps and content can be implemented. So more than being a document to win over investors, a good business plan needs to be doable.

Don’t be overly optimistic about time and resources, it’s a common error of entrepreneurs. Be realistic, as it will give credibility to your plan. Always assume things will take 15% longer than you anticipated. If you anticipate that a certain process takes 20 weeks, write 23 weeks instead.

The success of business planning is all in the details. Make the plan concise, but include enough details that a reader will have sufficient information to make educated decisions. A business plan should reflect a sense of professionalism, with accurate content, realistic assumptions, credible projections, and no spelling mistakes.

This article was written by Funding Societies, Singapore’s leading peer-to-peer (P2P) lending platform. We provide working capital loans for small and medium-sized enterprises (SMEs), along with attractive investment opportunities to the broader public. To learn more about us, click on our website here.

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Career

Saving In The Digital Era

We’ve all been there before: at first, we were just absentmindedly scrolling through our Instagram feed when we come across a beautifully made travel bag or trendy sneakers posted by a brand account. Next thing we know, we’ve placed our order and we’re ready to make a purchase.

Everything happened too fast! When the order arrives at our door, our satisfaction levels are high. But in mere days we realize we didn’t really need the product in the first place.

Temptation is everywhere in the digital era, and it’s becoming harder and harder to save money. With the rise of technology and social media, online shopping is just one easy click away. If you fall prey to too many ill-considered purchases, you will soon have bad financial habits.

So how do you save money in the social media era?

Set up automatic deposits into your saving accounts

Establish a budget, period. When you have an accurate view of your income and expenses, you can start improving your personal finances. Once you have set a budget and clear goals, get in the habit of saving money by automating the process. Set up regular and automatic deposits into your savings and investments accounts, either directly from your paycheck or from your checking account.

Get a money buddy

According to an MIT study, friends with similar traits can pick up good habits from each other. Financial planners also recommend having someone to hold you accountable for the task at hand to increase effectiveness and deliver stronger results.

Consider using the concept to save more money. You don’t need a finance whiz, you can find a partner in a friend, a parent, a sibling, or your own spouse. Set an achievable savings goal and ask your money buddy to monitor your progress and keep you on track.

Solo shopping

When it comes to shopping, it’s fun to shop with company. For the sake of personal finance, however, it’s better to shop alone. In a fun and relaxed mood, your friends might encourage you to buy more things than you intended. Obviously, it’s not healthy for your financial condition.

If you still want some company, ask your money buddy to accompany you. They are monitoring your personal finance progress, after all – chances are they won’t suggest shopping as a way to have fun in the first place.

When you get a raise, raise your savings too

Everyone says they would save more when they have more. But do people actually do it? When we get a raise, usually the first thing we do is buy something expensive to celebrate the occasion. Maybe a handbag, or plane tickets to a dream destination.

Celebratory spending is fine. Some self-reward is healthy. But remember to increase your automatic monthly transfer to savings as well. It might be painful now, but you will reach your personal finance goals faster if you allot more money to your savings and investments from a younger age.

Ultimately, saving enough money comes down to willpower and contentment. Do you have enough willpower to save? Are you okay with not having more right now? If you can develop both these qualities, you will grow wealthy over time.

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Investing

8 Principles of Investing for Beginners and Beyond

To start, there are no investment hacks and shortcuts. Investing requires time, research, and maintenance. Effort? Depends on the instrument. Stocks, for instance, would need more vigilance than bonds, which is mostly a ‘buy and wait for maturity’ affair. Overall, however, there are no instafix to get you high investment returns.

For beginners and those who want to refresh the main principles of investing, we’ve collected 8 crucial tenets.

1. Know that investing is a commitment

Investing can be compared to quality relationships. Both require patience and its close kin, time. There are more investment options available than ever on the market, with new ones like cryptocurrencies and P2P lending entering the mainstream. But before you choose “the one”, you must first determine your investment profile. Then, you need to mull over the pros and cons of various instruments before selecting those that best fit your purposes.

Time also applies to the investments themselves. Some investments allow you to cash out by a relatively quick maturity date. Others take longer. It also pays to take time and review your investments regularly. Depending on how the markets have moved, you may have to rebalance your investment portfolio to fit your personal risk tolerance.

2. Invest when you have enough savings

Everyone has a benchmark for how much savings is “enough”. But it’s essential to have several months’ worth of monthly expenses before you invest your money. Three months’ worth is a good minimum amount, six months’ worth is safer.

If your savings account is stable, you have something to turn back to if you have an emergency and need funds immediately. When all your money is tied up in investments during unexpected times, you may have to withdraw funds when the markets aren’t optimum or when your investments haven’t reached maturity – exposing you to hefty penalty fees.

3. Watch the inflation rate

The interest we get on our savings is insignificant and when you factor in banks’ admin fees, our savings usually stay flat over time. What doesn’t stay flat, unfortunately, is the price of goods thanks to inflation.

Inflation is why we invest; we want to stabilize our purchasing power in the long term. To do so, our investments must beat the national inflation rate. To solve this, balance an investment portfolio that delivers overall returns above the inflation rate.

4. Know your personal risk tolerance

Thereby, know the risk and return principle, which declares that the higher the potential returns, the higher the risk – and vice versa. Because of the risk and return principle, everyone’s investment portfolio will look different as every investor balances risk and reward according to his personal risk tolerance and future goals.

Aggressive investors will aim for instruments with the highest returns, no matter how risky. Their portfolio can consist of 80-90% high-risk instruments. Meanwhile, investors with a low stomach for risk will veer towards safer products.

Age is often, but not always, a factor in determining risk tolerance. Rationally speaking, someone young and healthy, with enough savings and a long period of productivity ahead of him can afford to take more risks.

The idea of establishing your personal risk profile is to support you in building your perfect portfolio – one that reflects your personal preferences.

5. Remember the risk and return principle: anyone promising extremely high returns either requires you to take an equally extreme risk or is selling an investment fraud

Certain instruments can be stable while offering higher returns relative to other instruments, but there is no magic instrument with high profit and no risk. It simply does not exist. Be instantly wary of suspicious offers. Investment scams tend to have several things in common: high and unsustainable returns (think monthly returns above 10%), lack of transparency, general product claims (gold, foreign exchange, etc), and no operational license.

6. Diversify, diversify, diversify

How do you mitigate risk? You diversify your investments. Diversification means allocating your funds among a variety of investments. The more diversified your portfolio, the more protected you are. Even if an investment fails, your overall returns stay positive.

Diversification is how you build your unique investment portfolio. Remember personal risk profile? Maybe you are risk-averse. You may want to compile a portfolio of 70% bonds and fixed deposits, 10% in cash and equivalents, and 20% in stocks. If I’m risk-averse, why not spend 100% of my funds on fixed deposits, you ask? Even “safe” instruments have risks. What happens when fixed deposit interests fall? Your portfolio value will be diminished. Spreading your investment across various assets will prevent this problem.

7. Reinvestment is essential

When your investments generate earnings, you have several options. You can withdraw and cash out. But if you want long-term benefits, you should reinvest those earnings so they generate more earnings.

Say you invest SGD 10,000 into bonds with 7% annual interest. After a year, you have earned SGD 700 in interest. You decide to reinvest the total SGD 10,700 into the same bonds in year 2. SGD 10,700 now reaps SGD 749 in interest earnings rather than SGD 700 and you didn’t do anything.  Over time, you would double your starting principal or more. The key is in diligence and frequency.

8. Invest early because time matters

The reinvestment principle especially shines when you start investing early. Let’s say person A invests in an instrument with 5-6% annual interest at age 25 and reinvests every year. Then there’s person B who does exactly the same with the same initial amount starting age 35. Various graphs show that when they are both 60, person A would have nearly double the money of person B.

Remember: start early, commit over the long term, have enough savings, know your risk profile, be wary of suspicious offers, diversify to build an optimum portfolio, and reinvest your earnings.

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Business

Funding Societies Surpasses $100 Million in SME Crowdfunding

Funding Societies welcomed the start of the year by crossing the SGD 100 million mark in total crowdfunded SME loans across Singapore, Indonesia and Malaysia. This is the highest total crowdfunded amount achieved by any peer-to-peer lending platform in Southeast Asia.

In line with the platform’s goal of responsible growth, Funding Societies expanded its crowdfunding book by 400% in 2017 while maintaining a default rate of 1.5%.

You can watch their milestone video below:

Founded in 2015, Funding Societies provides business financing to underserved SMEs for their working capital and expansion needs. This is done through its digital marketplace platform where retail and institutional investors come together to lend to the SMEs. Businesses can avail loans ranging from just SGD 5,000 going up to SGD 1 million and at reasonable rates of interest. Funding Societies platform has facilitated funding across industries including Manufacturing, Engineering, Construction. Professional Services, Wholesale and Retail Trade amongst others. Most of the SMEs which Funding Societies has funded do not receive adequate financing through traditional options. Others have existing bank loans but approach Funding Societies for fast and short-term bridging loans.

Reynold Wijaya (left) and Kelvin Teo (right) at the tunnels of Harvard Business School where they conceptualised Funding Societies in 2015.

According to a Visa and Deloitte study, four in 10 SMEs in Singapore are unserved by existing financial institutions when addressing their financing needs. This problem is compounded, with 72% of Singapore SMEs requiring funds to better manage their working capital and cash flow. The lack of access to financing faced by SMEs is an issue that needs to be addressed. Alternative financing providers like Funding Societies are addressing this gap by providing funding solutions for the growth of local businesses.

Kelvin Teo, Co-Founder and CEO of Funding Societies, commented, “We started Funding Societies while at Harvard to positively impact SMEs in Southeast Asia. 2017 has been a strong year, as we gained global recognition for our efforts including our loan mobile app FS Bolt and our chatbot Miyu. We’d work even closer with the SME community in 2018, in line with our motto ‘Stronger SMEs, Stronger Societies’.”

Funding Societies received many local and global awards in 2017. At the end of 2017, its Indonesian entity, Modalku, won the Global SME Excellence Award from United Nations’ ITU Telecom. It is the first and only Asian startup to win the award. The company was also included in CB Insights’ Fintech 250, a select list of the top FinTech companies around the world working on groundbreaking financial technology. It also won the Best in Customer Experience Asia award from Retail Banker International and was conferred as the Hottest Startup in Singapore by Singapore Business Review. The local and international awards highlight the impact of financial technology on society.

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Business

The Myths And Misconceptions About FinTech

Ah, financial technology – better known as FinTech. A very booming sector, and there are many thoughts and perceptions about it. Unsurprisingly, there are misconceptions about the industry ever since it shook up the financial world.

We can’t deny that FinTech is indeed disruptive and revolutionary, but is it truly going to destroy traditional financial institutions? We don’t think so, thus we invite you to take a look at these four common myths and misconceptions about FinTech.

It’s stuck in a bubble and will burst

The concept of “bubbles” in markets was introduced during the “dotcom” era, when growth and funding in startup websites were climbing steeply. The rise of FinTech has been compared to the dotcom bubble. Yet there are now more than 45 FinTech unicorns (each valued at more than $1 billion) worldwide. Five of them have gone public, proving that the industry is not going anywhere. Not only do the numbers speak for themselves, the FinTech industry has given the world new business models. For example, companies like StudentFunder enables access to education for students who can’t find proper funding elsewhere.

FinTech is not secure

FinTech may be relatively new to the financial world; that doesn’t mean it’s not secure. Yes, new technology is never completely safe from the possibility of cyberattacks, but FinTech is no more exposed to these threats than any other sector. Besides, any reliable FinTech company will have security and identity checks in place.

Trying to learn more about how to protect your business from hackers? Read “How to Protect Your SME from Cybercrime”

It’s only about lending and payments

In the US, lending and payments dominate the FinTech industry by 80%. However, other areas like insurance, market provisioning, investment management, and capital raising are also making significant progress in FinTech. In fact, The World Economic reported that insurance is one of the biggest disruptors in FinTech, as advanced algorithms and computing power are changing the industry. There are also new financial management systems that are able to help people save money and time, boost credit scores, and detect fraud all in the same place. FinTech can also provide superior data analytics. Thereby the assumption that FinTech is a limited sector is simply false.

It’s waging a neverending battle with banks 

Some conventional banks feel threatened by the rise of FinTech, since FinTech is always seen as the “disruptive” one. In reality, banks and FinTechs are getting along quite well – fintech and banks have recently been making collaborative partnerships for the financial industry. Why? FinTech builds products and services with cutting-edge technology that people need but platforms often lack distribution capabilities. Which party has large distribution capabilities? That’s right: banks.

Because fintech is online-based, eventually they can reach prospective clients more widely and more quickly. According to CB Insights data, six major banks in the US have made strategic investments in more than 30 FinTech companies since 2009. So much for enemies!

The world, especially advances in financial technology, is moving fast. Watching the journey and further innovations of FinTech will be an exciting ride.

This article was written by Funding Societies, Singapore’s leading peer-to-peer (P2P) lending platform. They provide working capital loans for small and medium-sized enterprises (SMEs), along with attractive investment opportunities to the broader public.  To learn more about them, visit their website here.

Funding Societies is a DollarsAndSense Brand Connect partner. You can find out more about what they do on the DollarsAndSense Brand Connect Page.

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