Financial technology continues to change so rapidly that it’s difficult for many entrepreneurs to keep up with it. The widespread use of mobile devices and the shift towards technology are two of the most significant trends. Small business owners need to know more to take advantage of the efficiency these advances offer.
Cloud-based financial apps
With broadband service becoming faster and cheaper it is now more feasible for companies to run financial apps from the cloud. In the past, many small businesses were forced to be their own IT departments. Software patches, hardware upgrades and other tedious work had to be performed to protect critical data and keep systems running. Cloud service providers take care of most of those tasks now, freeing entrepreneurs to focus on their core competencies.
Another attractive feature of cloud computing for financials is that the service provider has redundancy in its server architecture and off-site data storage. Everything is backed up on a regular basis and recoverable in the event of a disaster.
Financial software in the cloud is available at affordable prices and from reputable providers. For $39.95 per month, Intuit QuickBooks is well within the budgets of many small companies. Intuit also offers an online payroll application for $39. Freshbooks also provides online billing, accounting and invoicing software in the cloud for $39.95 for an unlimited number of clients.
Financial mobile apps
Mobile devices are another market that financial app developers have targeted. Just about any smartphone with the right apps installed can access a bank account and perform transactions. Optical character recognition has advanced to the point that it’s possible now to take a picture of a check, transmit the image to the bank and the check is deposited. There are no envelopes or slips to fill out.
In the past year, point-of-sale (POS) solutions for smartphones and tablets are more popular. All that is needed is to install a POS app on the device and to insert a card reader into a port and you now have a fully functional POS device. The apps and card reader are provided by banks like Bank of America or by third parties like SquareUp which can link transactions to business accounts. Scandit has an API that do-it-yourself entrepreneurs can use to save money by creating their own POS solutions.
One of the disadvantages of mobile POS solutions is that the per-swipe fee is still more than with a regular POS device. For some businesses there has to be a really compelling reason to use a mobile POS to justify the added cost.
Entrepreneurs often need funding to get their businesses off the ground and one of the more recent trends to accomplish this end has been in the area of crowdfunding. When the banks and venture capitalists say no, another option is to put a proposal for the business on a website and ask the public for support. The recent JOBS Act that the U.S. government passed in 2012, allows shares to be issued to investors under certain conditions.
Several sites now provide a platform for business owners to seek crowdfunding. Kickstarter, the most popular site in this field, typically supports creative efforts, but not causes or awareness campaigns. Other similar sites include Indigogo, RocketHub and GoFundMe.
Technology in recent years has opened up available options to small business owners as it relates to finances. Receiving funding, processing transactions and computing architecture have changed a lot in the past five years. Entrepreneurs can take advantage of these developments to serve more customers and make running their own business a lot smoother.
About the Author: This article is written by Tara Miller