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How fintechs can keep a handle on costs

Small and medium sized enterprises (SMEs) now spend an average of £1 million (£1,016,194) each on business expenditure every year, according to new research*. The biggest costs in this annual shopping bill include hiring new staff, paying suppliers and investing in technology.


And SME spending only rises as businesses age, so getting cashflow management right from the start is an integral part of ensuring a smooth path to growth. This is certainly the case for fintechs which are also, more often than not, SMEs.


To ensure sustainable business growth, there are some key techniques that fintech companies can leverage to help keep a handle on costs. Whether you want to free up capital to grow the business further, boost profits or simply avoid cash flow headaches, often a few small changes can make a big difference.


Effective expense management 

For many small businesses, managing expenses can be a tricky task, so it’s important not to overlook optimising expenses as part of your broader business strategy. Having a clear process and tools in place for employees to submit their expenses not only makes it easier for them but also gives your company greater control and visibility over what is being spent, and where.


Regularly reviewing where your company money is being spent means you can make changes which can lead to some significant savings – whether that’s using data to negotiate better rates with key suppliers or putting new rules in place for employees on how they buy key products and services. 


Employee rewards

Agile fintechs are driven forward by agile minds, and to attract and retain the brightest talent in the industry businesses need to incentivise and reward valued employees. By using a business credit or charge card that earns rewards for company purchases you can accrue rewards from your business spending which can be used to fund travel upgrades or other business perks for employees.


Keep cash under control

The better the grip on cash flow within the business, the easier it is for fintech businesses to remain innovative and nimble, by being able to deploy resources and investment as soon as it’s needed. In the early stages of business it’s important to prioritise cashflow ahead of profits as the former is essential to making sure that you pay your suppliers and staff effectively, and forge positive relationships from the beginning. To help this, set up payment terms with customers – before signing a new customer, ensure you have agreed payment terms so you are not left out of pocket.


The raison d'être of fintechs is to stay nimble and operate efficiently. Make sure your company’s internal operations and finances reflect this, to put you in a strong position to control spending and grow sustainably.


*Research undertaken by Centre for Economics and Business Research and Opinium on behalf of American Express. The survey was conducted among 500 UK SMEs in July 2017.




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Jose Carvalho

Jose Carvalho

Senior Vice President, Global Commercial Payments

American Express

Member since

31 Oct 2017



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