Colin Timmis is the Head of Accounting South Africa, Xero. Image: Supplied.
JOHANNESBURG - Banking has been around for thousands of years. The fundamental concepts of banking and payments have remained largely intact during this time.

Today, we’re seeing huge disruption to the status quo. This shake-up will give businesses and consumers fantastic opportunities to better manage their finances. It encourages innovation, discourages complacency, and gives consumers and businesses more (and better) options. 

Fintech innovation is bringing this disruption to South Africa. Broadly defined as technological innovation related to personal and commercial finance. It’s anticipated that the market for it will amount to $10,499m by the end of 2018, with digital payments accounting for much of its proliferation and prominence.  

If you’re running a small business, you might be thinking about how you can use these burgeoning Fintech technologies to your advantage. The South African small business community has a huge appetite for technological invention and financial reform.

Why Fintech is flourishing 

In many respects, Fintech has arrived at precisely the right moment. A large underbanked rural population and a growing middle class have increased the desire for new solutions to old financial problems. Underserved communities have long desired better services, and even well-served communities are keen to explore more sophisticated options when it comes to issues such as payment processing. 

Crucially, the tech community is in a position where it can provide these solutions and options. In South Africa, incubators and accelerators are popping up with clockwork regularity: Cape Town, for example, recently hosted its very first ‘Startupbootcamp’ – which focused on creating scalable technology solutions for financial services and related industries. Aurik Business Incubator, run by Pavlo Phitidis, is actively working with new entrepreneurs to turn their businesses into valuable assets. South Africa is also attracting and showcasing the very best talent in the startup community at events such as the African Angel Investor Summit and BCX Disrupt. 

An enthusiastic, vibrant development ecosystem, a clear gap in the market, and a willing target audience has led to Fintech’s rapid rise. 

How Fintechs can help small businesses flourish

If you’re running a non-technology business such as an estate agency, a florist’s, or a hair salon, you might well wonder why this matters to you. In 2018, businesses can only progress if they embrace new technologies. It opens up huge possibilities for you to reach a global community; enhance your relationship with the digital-first, millennial audience etc. 

For example, apps like Shopify and TradeGecko can support your e-commerce efforts – allowing you to sell products online through a digital sales channel. For many customers who prefer to make their purchases with a minimum of travel or interaction, this is the ideal option. 

If you want to go into more detail, tools such as VendHQ can offer a real-time breakdown of stock supplies. By having a clear window into what is and isn’t selling, you can tailor offers when you need to move something quickly, or capitalise on a high-performing product. Elsewhere, apps such as GoCardless can ease the management and processing of payments – all the while ensuring that your bank balance and your time remain blissfully uncompromised. 

Beyond the individual merits of any Fintech app, going digital is simply easier for your business. When you use cloud tools, the management of bills, expenses, and invoices becomes significantly simpler; spreadsheets become unnecessary, if not highly discouraged. 

Businesses that embrace Fintech are more agile, more efficient, and better able to acquire and serve customers. It’s time to welcome innovation into the very heart of your business – to do more with digital, so it can do more for you. 

Colin Timmis is the Head of Accounting South Africa, Xero.

The views expressed here are not necessarily those of Independent Media.