Innovations introduced by various FinTech companies have sparked changes in global finance including the banking, digital payments, and wealth management industries.
A recent study by McKinsey & Company reveals the strong shift of public opinion on FinTech. The study shows that different industries, by and large, saw an increase in FinTech usage during the pandemic. Investment and lending platforms usage has increased 23 and 25 percent, respectively, over the last year. Banking FinTech accounts saw an increase of 6 percent. Payment accounts saw a 16 percent increase in usage.
A survey by Blumberg Capital shows similar results, with 50 percent of respondents saying that they reduced their use of cash significantly since the pandemic started. The same survey also finds that 78 percent of consumers believe that reliance on physical financial institutions is phasing out while only 20 percent share the opinion that these institutions are evolving fast enough to address changing customer requirements and preferences.
As the FinTech sector is surging and making inroads into traditional finance industries, Israeli startups are making their presence felt in the US market with the introduction of innovative new products. These companies demonstrate the reasons FinTech is becoming more enticing and easier to adopt by individuals and institutions alike.
There is growing interest in cryptocurrencies, especially with the wealth generated from trading and investing in Bitcoin and other coins. One challenge from decentralized technology, however, is the ease of use for consumers and businesses. Also, cryptos are still not as easily exchangeable with fiat currencies.
To address this, the EU-licensed Simplex offers a powerful and seamless infrastructure for fiat and crypto transactions. The company has partnered with over 350 entities worldwide to work with a vast range of payment methods including SWIFT, SEPA, MasterCard, Visa, and Apple Pay. Simplex accounts come with their own personal IBAN, which provides the ability for bank transfers to and from anywhere. Partners of Simplex can also offer their customers a crypto-friendly bank card.
Supporting more than 50 digital currencies and 50 fiat currencies, Simplex aims to deliver the benefits of “zero risk, zero rolling server, and zero security incidents” under an easy-to-use system. It also adds a zero chargeback guarantee and flexible integration with other systems. Moreover, Simplex ensures positive user experiences through its 24/7 customer support backed by an SLA.
Recently, the company started offering a new service called Simplex Banking for partners and individuals. This new FinTech solution lets users trade crypto at favorite outlets from a free account, giving them the ability to transact from more platforms for converting fiat money into coins.
Focusing on “big finance,” Tipalti specializes in accounts payable automation and global mass payments. This Israeli FinTech startup enables convenient AP and payment transactions through the cloud, providing businesses a highly scalable system for end-to-end global payable workflows.
AP accounting is inherently risky, challenging, and time-consuming. It is a tedious task that can be easily messed up by less-than-competent employees under an inefficient system. Tipalti addresses these pitfalls by sharing some of the responsibilities of AP accounting with customers—offering self-service supplier management and enterprise-grade financial controls. It also features invoice-based supplier payments and mass payments to partners.
With its innovative approach to AP and global payments, Tipalti streamlines the bill-to-pay-to-reconciliation cycle. In effect, it optimizes the accounts payable process while empowering partners, suppliers, and employees to handle transactions and keep track of records more efficiently.
The name Tipalti is a Hebrew expression for “I’ve handled it.” In that spirit, Tipalti eliminates the workload surrounding payables by 80 percent and significantly eases compliance risks while accelerating the financial close by 25 percent.
vcita is a business management app for small teams, solopreneurs and freelancers. It features FinTech functions that enable businesses to accept credit card payments in person and across digital channels. The app also enables businesses to send price quotes, invoices, bills, and receipts – and to link those elements together with appointments, service fulfillment, payments and customer relations.
With flexible digital payment processing, vcita offers service businesses the ability to accept payments on users’ own websites, on auto-generated customer portals and via mobile links.
Founded in 2010 in Tel Aviv as a self-service scheduling widget for websites, vcita expanded to open headquarters in Seattle within its first year of operation. Today the startup’s focus is on making it easier for service SMBs to manage their businesses. It provides a comprehensive set of tools that cover various steps of the customer journey, from scheduling to marketing and client management. As a new member of the SME Finance Forum, vcita has been cited as a platform that aids the digital transformation of small and midsize companies.
In tandem, vcita also works with banks, financial service providers, and FinTech businesses to develop business management software tools that empower those institutions’ small business customers.
Having attracted a $15 million investment round a couple of years ago, vcita has been working to develop its platform, particularly its accounts receivable automation capabilities for the benefit of SMBs worldwide. The startup was also recently named one of the Top 100 Software Companies of 2021 by The Software Report.
Trullion employs AI-powered automation to handle lease accounting. It is designed to unify the structured and unstructured aspects of accounting and translate them into financial workflows like lease accounting and revenue recognition. It is capable of extracting relevant data from source documents including Excel files, PDF contracts, so they can be easily linked to the audit trail.
Formerly known as SMRT, Trullion positions itself as a source of truth and confidence for accounting leaders. Acknowledging the importance of precision and accuracy in accounting, this automated lease accounting solution does not only speed up the accounting process with real-time data processing and reporting. It does it without compromising accuracy.
Businesses have been very careful in adopting new technologies, as uncertainties in their capabilities and mistakes in their outputs can be devastating. “The financial management industry has been stagnant for many years as industry pain points, including maintaining efficiency, accuracy and transparency, restrict executives’ time and collaboration,” says Brentt Baltimore of Greycroft, an investor of Trullion.
Trullion’s effective use of automation and artificial intelligence has gained the confidence of investors and industry leaders including Bell, Nokia HMD, KPMG, and RIGUP. Baltimore lauds Trullion’s “progress in revolutionizing the use of AI in accounting software.”
Capitolis focuses on FinTech SaaS products and solutions that, in the company’s words, “reimagine how the capital markets operate.” The company seeks to optimize the capital markets for all participants by allowing financial institutions to seamlessly spot opportunities for optimization, which can then be executed in collaboration with other market participants.
Aiming for maximum efficiency, Capitolis serves as a centerpiece for efforts to eliminate positions to free up capital without creating unnecessary risk, moving positions to better investments or institutions to open up credit lines, and creating new positions regarded as capital-efficient, enabling access to capital from the broadest sources.
Already used by more than 75 institutions worldwide, Capitolis offers a platform that takes advantage of advanced workflow technology and proprietary algorithms to evaluate and undertake portfolio optimizations with counterparties under a seamless and automated process. Capitolis’s innovative approach enables resource efficiencies and unlocks capacity in OTC markets that would have otherwise remained idle.
Capitolis started in 2017 with the founding of its network software and the establishment of the goal to help financial institutions in maximizing the yields of their capital through a fair financial marketplace. The company has the backing of leading venture capital firms including Index Ventures, SVB Capital, and Spark Capital, as well as investments from banks like State Street, Citi, and J.P Morgan.
The use of electronic payment in the US still has a lot of room for growth. More Americans have been using e-payments over the years, but the use of digital money or cashless payments in the United States still has a long way to go in comparison to the situation in the leading countries for cashless transactions.
There are many reasons for this. Some have issues with the privacy-invading nature of e-wallets and online payment systems with KYC policies. Others find it hard to figure out how to use new payment technologies. There are also those who want to avoid the onerous fees involved in paying or receiving money digitally.
Melio offers a solution meant to be simple and easy. It allows anyone to pay any invoice through bank transfer without any service fee or charges. Specifically intended for small businesses, this payment platform has a three-step process for making payments. The first step involves the adding of bill details through image recognition or integration with QuickBooks and other similar platforms. The next step is the selection of the payment method. Lastly, users need to choose their preferred payment delivery to complete the process.
Melio focuses on the B2B payment experience to save time and significantly improve cash flow for SMEs by simplifying the process of paying vendors and contractors. It also supports the payment of invoices through free bank transfers or credit cards, which allow the deferment of payments and earning of rewards.
The FinTech market is relatively young, and there are still many ideas in using financial technologies that are yet to be explored and formulated into a novel but useful business idea. The companies listed above are only six of the many innovators and trailblazers in the FinTech space. The new ideas they bring can help stimulate FinTech in America and bring the benefits of financial technology to more consumers.