Now, the finance sector has been undoubtedly affected by FinTech. This term “FinTech” means “Financial Technology”. The traditional financial services have been completely improved by Fintech with the use of advanced technology. Fintech offers faster and more efficient financial services than traditional financial services.
Fintech has become a challenge for the banks as the Fintech firms offer an easier way of payments through mobile wallets. People find mobile wallets very convenient as they do not need to go to a bank anymore for any payments. They can simply use their mobile wallet and make any payments online. Banks are now afraid of FinTech companies.
Today, there is a tough competition between the banks and Fintech firms. Fintechs have been offering new services that have not been offered by the banks. However, banks have now realized that they have to understand the customer demand and on the other hand, Fintech firms are now thinking to cooperate with the banks in order to produce more chances of success.
PoS(Point-of-Sale) device nowadays is very commonly used for the sales transactions and processing credit/debit card payments. Many Fintech companies and banks have started offering POS services. But the new thing in this POS world is POS financing.
With POS lending, the relationships between the banks and Fintechs are emerging. Indian Fintech company Paytm has now partnered with India’s largest private bank, ICICI Bank, to launch digital credit account on Paytm app. In this partnership, the bank provides an algorithm and credit information based on a customer’s financial behavior and the Fintech provides instant access to the app. Also, Fintech can help banks reach a wider range of customers to offer POS lending services.
In summary, When it comes to POS financing, Fintech companies should be thinking of being a bridge between banks and retailers, instead of competing with banks and being alternatives. Fintechs have the capabilities that can enable banks to offer new-generation services by putting the existing services on the backend. In the future, there is a hope that the leading companies in POS financing will welcome this collaboration between the banks and Fintech.
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