By Ajay Kadyan, co-founder and CTO of Zimyo
Have you ever wondered how to make payments for a ride before you even reach your destination or pay utility bills without even leaving your home? I’m sure you should be aware of this – via Paytm, Google Pay; yes, you can name many channels that allow instant payments. But how is it, how are traditional banks replaced by digital transactions? The answer is simple: with integrated financial services.
Integrated finance is the new business model that is gaining attention these days. Today, non-traditional financial players like Amazon, Google, etc. are also trying their hand at gaining market share in consumer financial services. In addition to these conglomerates, there are many HR technology platforms that facilitate access to financial services.
Integrated finance is a completely new concept for some people; Therefore, today we are going to take a look at the examples of integrated finance that will transform the near future:
1. Integrated payments
Integrated payments mean making payments at the push of a button. This leads to faster checkout and settlement processes thus providing a great payment experience. Integrated payments allow users to make payments from one place without having to search their pockets for cash or swipe cards. Food delivery apps like Zomato and Swiggy and payroll automation software etc. allow users to make in-app purchases and payments. These apps allow consumers to make payments without switching between apps.
2. Integrated card payments
In addition to making payments through credit cards and debit cards, you can make payments through integrated cards. Integrated cards allow end users to electronically transfer funds to the card and make purchases up to the full cash value held on the card. There are several platforms that issue smart cards, virtual cards, or spending cards. These cards can be a convenient alternative to cash. Payments by on-board card are secure because all information is encrypted. They also allow faster processing and are economical than traditional cards.
Integrated financing: making loans available for new rural clients to credit
3. Integrated loan
In this digital age, you don’t have to go to banks over and over again, check your credit scores, or wait until the underwriting process is complete to apply for a loan. Today, many non-financial products / services have entered the financial segment which allows users to apply for and obtain a loan directly at the time of purchase. This eliminates the need to use third parties, excessive paperwork and lengthy processes. User can get personal loans at the push of a button. Not only food delivery or retail apps, but even HR technology platforms also offer integrated loans to make life easier for employees and employers.
4. Integrated investments
Agree or not, but few of us know about secure financial investments. We don’t even think about it, let alone invest money. But becoming financially literate is important because it helps in the efficient management of our money. Making integrated investments is a smart way to manage your money. Integrated investments simplify the investment process by providing users with a single platform to invest and manage their money. Built-in investments allow users to invest in the stock market, mutual funds, pension plans, without leaving the platform they are on.
5. Integrated insurance
According to data from S&P Global Market Intelligence, India is the second largest insurance market in Asia-Pacific, accounting for 35% of the $ 3.66 billion in insurance-focused venture capital investments made in the country. . As people become more tech savvy, technical integration is of utmost importance in selling insurance policies. Considering the complexity of traditional methods of purchasing insurance plans, we can say that integrated financing is a much more viable option. Because it makes it easy for insurance companies to approach customers. On the other hand, customers are more likely to buy from a trusted platform than from a foreign entity.
6. Integrated banking services
Embedded banking is the type of bank in which banking-type services are offered by non-financial players. It replaces the checking or savings accounts offered by banking establishments. From a single platform, you can make investments, apply for loans, chip cards or manage your transactions. This provides users with a seamless banking experience. Integrated banking services make processes more efficient with fewer touchpoints and are much more cost effective compared to normal banking services.
Technology can bridge the gap between financial services and end consumers. Integrated finance makes access to financial services fast and hassle-free, thus improving customer satisfaction. As more and more non-traditional players enter the fintech segment, you can expect increased adoption of integrated finance among direct-to-consumer businesses.