In the past few decades, the innovativeness of FinTech industry has surpassed even the most optimistic expectations. The industry has dozens of large players valued in tens of billions.  Many of the unicorn startups might be disrupting industries with their innovative products, but when it comes to internal planning, they’re lagging behind.

FinTech companies typically maintain a complex set of relationships with financial institutions and other partners. This requires extensive accounting and keeping track of their finances. This is especially true for large FinTech startups.

Growth pains experienced by many expanding FinTech companies demonstrate the need for effective ERP tools. ERP consultants say that their solutions can be effective for a company at any stage of development. Still, it’s easier to implement ERP while your company is still relatively small. Once the company grows, the benefits of using an ERP solution are immense.

Fortunately, more and more FinTech companies are starting to realize the potential of ERP for internal planning. Outsourcing menial tasks to the ERP solutions (under the supervision of specialists) allows the management to divert their attention to more important tasks, such as making creative and strategic decisions that promote growth.

Why do Fintech companies need ERP?

The primary benefit of using ERP solutions is that they pave the way for FinTech companies to achieve success at a larger scale. To be specific, ERP consultants can:

Increase efficiency through automation:

Even though FinTech companies are great at detecting and addressing the inefficiencies of the market, they’re sometimes incapable of fixing inefficiencies within their organization. One solution is to hire more workers to ensure that internal operations go smoothly. A much better alternative is to hire ERP consultants and listen to their recommendations.

ERP can automatize internal financial reporting, financial analysis, and even regulatory compliance. As the company grows, dealing with bureaucracy becomes an extremely burdensome, yet essential part of everyday routine.

The importance of internal financial data can not be overstated. The most advanced companies use the data to make key financial decisions. ERP software can organize the data to allow the managers to gain valuable insights into the financial performance of the company.

Improve Internal Communication

As the company grows, its departments grow with it. Sometimes FinTech startups hire employees very fast. Within a span of a year, the headcount for each department might exceed the initial number of employees at the entire company. The heads of departments can use ERP software to facilitate the communication and flow of essential information.

Some ERP solutions also have the capacity to help you keep track of employee morale and overall satisfaction.

Maintain client relationships

In the FinTech industry, keeping the customers (or in some cases, partners) happy is the key to success. Fortunately, ERP solutions also include features that facilitate communication with the customers.

When it comes to data protection, FinTech companies must maintain their credibility at all costs. Fortunately, ERP solutions have features that can help you plan to arrange the safety measures for your B2B client's data.

If your company is primarily focused on serving individual customers, you can still utilize ERP software. You can use these tools to develop a brand loyalty program and stay closely connected with them and promptly answer their inquiries about the product.

How to make the best use of ERP?

Decide on your priorities. You can only choose the best ERP software if you know what your company needs. Ask important questions, like: How many people do you currently employ? Do you envision the company to grow much larger in terms of the number of employees? ERP consultants say that large companies are the ones that benefit the most from using their software. If your company is small, and you intend to keep it that way, you might be better off not using ERP software at all.

Consider the ERP software vendors carefully. If you anticipate that you’re going to need after-sale support, make sure to verify that your vendor provides it. Also, if you need to address problems specific to the FinTech industry, avoid generalized ERP solutions. It’s better to pick vendors that focus on developing solutions specifically for the FinTech industry. If your problems are unique to your company, you should also consider whether or not the vendors can provide customized solutions.

Last but not least, pay attention to the cost. ERP software is not cheap, but if you put it to good use, the investment is worth it. See if you can find the funds in your company. Make sure you have the funds to cover all the costs associated with ERP software, including setup and recurring fees.

Future of ERP for FinTech

By streamlining the operations and record-keeping, ERP software can help FinTech companies achieve significant success. Currently, the biggest players in this industry make use of some form of ERP. However, just like FinTech products, ERP software also goes through constant evolution. The company leaders must be aware of the options available to them.

In some cases, a company can save or potentially make millions of dollars just by switching to different software. FinTech space is getting more and more competitive and the companies that use every tool at their disposal are going to prevail.

At the end of the day, the businesses that use the newest and the most practical ERP software are going to have an upper hand over their competitors. The solutions must be practical because simply using the newest tools isn’t going to make much difference unless they include the features to resolve the problems of your company. ERP consultants can recommend the solutions that are designed to address the specific problems faced by your company.

Summary

Companies in the FinTech industry can streamline their operations by using the right ERP software. If there’s no one at the company who can find the areas for improvement, the executives should hire ERP consultants to do it for them. The cost of the software might be deterring at first, but the savings, in the long run, are more than worth it.