Fintech has become one of the most fastest-growing businesses in Indonesia, offering various types of services such as cashless payment systems, peer-to-peer lending, account aggregation, investments, and insurance. However, this phenomenon shows that the competition in the finance industry is getting tougher.
Winning the competition in the financial sector is indeed not easy, but you can make your business a step ahead of your competitors by implementing the right strategies. Here are a few tips for building a successful fintech company that you can apply.
1. Focus on Customer Service
One of the most common mistakes made by fintech entrepreneurs is focusing too much on increasing revenue. Akshay Garg, the founder of Kredivo, one of the leading fintech businesses in Indonesia admitted that. According to him, many fintech entrepreneurs focus more on making profits than improving their services, although they are struggling to gain public trust.
When you have successfully gained public trust in your business, finding investors should not be difficult. This was admitted by Modalku, a pioneer of financial technology-based peer-to-peer lending services in Indonesia. Great services along with transparency will help fintech companies get trusted by customers and investors.
2. Build a Healthy Work Culture
The success of a fintech company cannot be achieved without the role of its workers. Therefore, it is very important to build and maintain a healthy work culture. Although there is no ideal description of what a healthy work culture is like, there are a few elements that create it:
- Productive work environment
- Low stress levels
- Transparent communication
- High employee satisfaction
- Low employee turnover
- Room to grow
Pressure at the workplace is unavoidable, but stress can absolutely be reduced. High employee turnover and decreased productivity can lead to many obstacles in various business activities. Therefore, it is important to improve your HR management.
Make sure employees’ salaries and benefits are always paid on time, have your employees fill out satisfaction surveys, review their achievements, analyze and help improve their performance. To ensure the whole process is going well, consider using a centralized HRM system to simplify complex HR operations throughout the company.
3. Find Reliable Partners/Investors
You will compete with many other fintech entrepreneurs with lots of money, so attracting partners and potential investors early on in the process is important. This could be a fairly difficult stage, but you must be patient and selective.
You and your prospective partners or investors should share the same idea and passion, so that the collaboration can run smoothly. Choose a funding source that suits your needs. Venture capital companies can provide large amounts of money with strategic inputs, but often want to be included in important decisions. Most private investors do not interfere, but usually their capital resources are limited.
4. Ensure Smooth Cash Flow
Not only do you need to secure your capital in advance, but also after your business has been launched. Supporting your business to keep running is not enough, you also need to ensure that your business is profitable.
Know your expenses and income in a given period (for example, a month or a year). Make sure you don’t spend more than you earn. Therefore, it is important to keep your budget under control and check customer bills regularly.
Business finance apps like EQUIP Accounting can help you better manage your finances. This software makes it easy for you to control expenses and allocate budgets, keep track of receivables, calculate profits and losses, and forecast revenue. This tool also makes it easier for accountants to follow up on invoices, which will help you get paid on time and result in healthy cash flow.
5. Invest in Technology that Supports Your Fintech Business
Fintech startups are booming. Each of them has unique and attractive offers for customers. You must enhance your competitive advantage if you want to stay ahead of the competition.
One of the smartest ways to gain a competitive advantage in the fintech business is to invest in automation systems like ERP software. An ERP system helps you gain greater insight into your business, covering from accounting, HRM, CRM, to asset and contract management.
With most of your business processes being automated, efficiency and productivity can be improved, while operating costs are significantly reduced. Complete and accurate analytical reports will help you make better business decisions. You can also focus more on innovating to provide better services for your customers.