The new feature, called ‘Split payment’, allows customers “to decide how much of an inbound payment, such as their salary, to put away and where, including their saving Spaces, joint accounts, additional accounts and Kite cards.”

‘Split payment’ users can “organize inbound payments either by value or percentage.”

Funds are then “organized instantly, with no need to make lots of individual transfers of different amounts to different accounts or Spaces.”

Read more: Crowdfund Insider

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Fintech is empowering people to take control of their finances, allowing them to make more informed decisions and plan for their future. This is especially beneficial for people who may otherwise lack the resources or knowledge to navigate the financial world. With the help of fintech, everyone can now access personalized financial services, regardless of their financial background or knowledge.

What is Fintech?

Fintech, short for financial technology, is the use of technology to provide financial services. It includes a wide range of products and services such as digital wallets, payment processing, mobile banking, investing, and more. Everything from how to find the best high yield savings account to actually managing it.

Fintech is transforming the way people interact with their finances, making it easier and more affordable to access financial services. It is also transforming the financial industry by providing new opportunities for startups and established businesses to provide innovative products and services.

The term “fintech” was first coined in the early 2000s, but the concept of using technology for financial services has been around for much longer. In the past, financial services were only available through traditional banks and financial institutions. However, with the rise of the internet and mobile technology, fintech companies have been able to develop new products and services that are more accessible and affordable for everyone.

Benefits of Fintech

Fintech has many advantages for individuals and businesses. For individuals, fintech can help them save time and money by streamlining their finances. For example, people can now access budgeting tools, automated investments, and budgeting apps that can help them make better financial decisions. Fintech also makes it easier to access financial products and services, such as loans and investments, without needing to go through a bank or other financial institution.

Fintech also has benefits for businesses. Companies can now use fintech to automate their financial processes, such as payments and invoicing. This can help them save time and money and reduce the need for manual labor. Additionally, fintech can help businesses improve their customer experience by providing better customer service and more personalized financial services.

Fintech Statistics

The growth of fintech has been staggering in recent years. According to Statista, the global fintech market size was estimated to be $127.66 billion in 2020, and it is projected to reach $309.98 billion by 2023. In the US, the fintech market is expected to reach $48.98 billion by 2024. Additionally, the number of fintech companies globally is expected to reach 8,500 by 2022. These numbers demonstrate the incredible growth of fintech and its potential to transform the financial industry.

Popular Fintech Technologies

Fintech encompasses a wide range of technologies, but there are some that are particularly popular. Some of the most common fintech technologies include digital wallets, mobile banking, payment processing, artificial intelligence, blockchain, and cryptocurrency.

Digital wallets are becoming increasingly popular as they provide a convenient way to store and manage money. Mobile banking allows users to access their accounts, manage their finances, and make payments from their smartphones. Payment processing makes it easier for businesses to accept payments from customers and for customers to make payments to businesses.

Artificial intelligence and machine learning are being used to create more personalized financial services and products. Blockchain is a secure digital ledger that can be used to store and transfer data, including financial data. Finally, cryptocurrency is a digital currency that is used to make transactions on the internet.

How Fintech is Transforming Personal Finance

Fintech is transforming the way people manage their personal finances. It is making it easier and more affordable to access financial products and services. For example, budgeting tools and budgeting apps can help people plan their finances and make more informed decisions. It can also help people save money for travel. Automated investments can help people save time and money by making investments without needing to manually research or purchase investments.

Additionally, fintech is making it easier for people to access credit and loans. For example, peer-to-peer lending platforms allow people to borrow from other individuals or businesses, rather than from traditional banks or lenders. This can be beneficial for people who may be unable to access credit from traditional sources.

Different Types of Fintech Solutions

Fintech solutions can be broadly divided into two categories: consumer solutions and enterprise solutions. Consumer solutions are focused on the individual and include technologies such as budgeting tools, automated investments, and payment processing. Enterprise solutions are focused on businesses and include technologies such as artificial intelligence, blockchain, and cryptocurrency.

• Consumer solutions are typically easier to access and use than enterprise solutions. They are designed to be user-friendly and provide a wide range of services to individuals.
• Enterprise solutions are more complex and require more technical knowledge to use. They are designed to provide businesses with the tools they need to automate their financial processes.

How to Choose the Right Fintech Solution

When choosing a fintech solution, it is important to consider your specific needs. Different fintech solutions provide different services, so it is important to choose one that meets your needs. Additionally, it is important to consider the cost of the solution, as some solutions may be more expensive than others. Additionally, it is important to consider the security of the solution, as some solutions may be more secure than others.

Tips for Using Fintech

When using fintech, it is important to keep a few tips in mind. First, make sure to read the terms and conditions of the solution you are using, as they may contain important information. Second, use a secure password and two-factor authentication to protect your account. Third, be aware of potential scams that may be associated with fintech solutions. Finally, make sure to understand the fees and charges associated with the solution you are using.

Challenges of Fintech

Although fintech is an incredibly powerful tool, it does have some challenges. One of the biggest challenges is the lack of regulation. Many fintech solutions are not subject to the same regulations as traditional financial institutions, which can make it difficult to protect consumers from scams and fraud.

Additionally, some fintech solutions may be vulnerable to cyberattacks, which can put customer data at risk. Finally, some fintech solutions may not be available in all countries, so it is important to check if the solution you are interested in is available in your country.

Conclusion

Fintech is revolutionizing the way people manage their personal finances, making it easier and more affordable to access financial services. Fintech solutions can help individuals save time and money by providing budgeting tools, automated investments, and budgeting apps. Businesses can also benefit from fintech by automating their financial processes and improving their customer experience. However, it is important to be aware of the potential risks associated with fintech, such as lack of regulation and cyberattacks. Overall, fintech is making it possible for everyone to access personalized financial services, regardless of their financial background or knowledge.

The post Fintech for Everyone: Making Personal Finance Affordable and Efficient appeared first on FinTech Ranking.

The best way to ensure this done to an optimal standard is to incorporate a financial management platform into your company.

But how can you find the right one?

In this article, you’ll learn where you can find the best financial management platform for your business, what it is, and how it can benefit your company.

Where can you find the best financial management platform?

It’s important for your business to secure an expert financial management platform, that not only provides you with a clear and organized structure for your spend data, but also allows you to monitor, control, and evaluate your spending with a range of features.

Therefore, the best platform for your business is spend management software – more specifically, an expert software such as Mesh Payments spend management, for example.

What is spend management software?

Spend management software is an advanced financial management platform, that allows you to effectively manage every aspect of your corporate spend.

This includes extensive and precise data surrounding every transaction that occurs throughout your business. You’ll gain full visibility on your spending, such as the payments you make, how much is spent, who are the payment recipients, what’s being purchased, and much more.

As well as this, you’ll gain access to a variety of features that take your corporate spend management a step further. For example, features that enable you to control how every area of your company spends money, as well as insights that analyze your company’s cost-efficiency.

Spend management is the ultimate software for any business looking to elevate their financial management processes.

Why is spend management software the best financial platform for your business?

Spend management software is the best financial platform for your business, due to its wide variety of benefits, which include:

• Expert spend controls

A main benefit of using spend management software in your business, is that you can implement a range of expert spend controls to more effectively handle every corporate transaction.

For example, one feature the software provides is the use of spend limits across your company. These are specific limits that cap any transactions which exceed them, and stop them from taking place.

These limits can be applied to individual cards, specific purchases, or entire business teams – whatever you desire keep your company within the established budgets.

• Highly-efficient spend workflows

Spend management software can also significantly increase your company’s efficiency when it comes to spend workflows.

This is essential for creating a smoother financial management process, and allowing for a more accurate picture of corporate spend.

For instance, you can implement automatic approvals for your transactions, so that any payments which match a certain criteria – established by you – can be automatically approved, without the need for manual intervention.

This ensures there are no delays with any important payments, and you won’t have any pending transactions which hinder a clear picture of your entire corporate spend.

• Meaningful spend insights

You can also receive a range of meaningful spend insights for your company, which will outline all the ways you’re spending money and how this can be more cost-effective in every area.

These insights can come in many forms, such as suggestions for cheaper alternatives to any transactions you might be making – e.g., a particular service you pay for each month or year.

You’ll be informed of any other alternatives which perform a similar service, but at a cheaper price.

This helps you stay consistently on top of your corporate spend, where you can always evolve and optimize how cost-efficiently you’re handling your finances.

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Now you’ve seen how spend management software is the superior financial management platform for your business, get in touch with your expert provider now, to incorporate your own software.

The post How to find the best financial management platform for your business appeared first on FinTech Ranking.

This is where technology in the form of fintech can help save the day. In this article, you’ll learn more about the basics of fintech and how it can help you improve and manage your personal finances. 

Fintech: What Is It Exactly?

Short for financial technology, fintech refers to any technology that improves, automates, streamlines, or optimizes the use and delivery of financial services. Fintech refers to algorithms, software, and applications for both mobile and desktop.

At its core, fintech is used by consumers and businesses alike to better manage their financial lives, processes, and operations. 

How Fintech Helps You Improve And Manage Your Personal Finances

1. It Boosts Your Financial Literacy

In general, a person who acquires a better understanding of finances early in life has more time to build a better credit rating and can take more risks and improve their overall financial life. Decades ago, achieving good financial literacy was often difficult. Today, fintech has emerged as a new tool to encourage and drive financial literacy. 

Fintech companies have come up with a variety of methods to educate their users. You’ll find apps that educate you about personal finance in the form of video lessons, financial courses, and various learning materials. Apps are also useful in teaching you how to form good financial habits, including financial mapping, and providing a complete picture of your finances. 

2. It Makes Banking Easier

Gone are the days when you need to go to the bank to deposit savings and check your balance. Inconveniences like these and limited access to banking institutions are what obstruct most people from starting to take control of their finances. 

However, thanks to fintech, it’s now easier and more convenient for customers to access banking services. Most financial institutions now offer online banking in several forms including website platforms and apps. You can now check your balance, pay bills, transfer money, and more with just a few taps on your phone. 

Aside from its convenience, quicker and more intuitive transactions allow you to track your spending more efficiently. Digital banking apps and financial tools allow you to see transactions and financial history, so you can make financial adjustments as necessary. 

3. It Provides New Financial Opportunities

Fintech has opened the door to new opportunities on how to make and use money that didn’t exist before—from better savings to new investment venues. 

For instance, neo-banks and digital banks are currently on the rise to help improve saving habits. These fintech alternatives to traditional banking institutions are offering higher interest since they don’t face the same expenses as conventional brick-and-mortar banks. These online banks can offer up to 3% or higher interest rates on savings accounts, along with awesome perks and benefits. 

Meanwhile, cryptocurrency is another great fintech innovation that offers quicker, more secure, and cheaper international payments. It removes currency conversions, eliminates high transfer fees, and completes the process faster as well as serving as a good investment product.

4. It Automates Your Finances

Behavioral economists advise that in terms of improving your personal finances, you need to start saving for the long term. And to save more money, you need to make it as simple as possible and remove any obstruction. This is where fintech comes in. 

Fintech helps automate your savings. You’ll find solutions that allow you to deposit your paycheck straight into your savings account. Some tools also use emerging technologies such as artificial intelligence (AI) to move funds from your checking account to your savings account when its algorithms decide to do so by carefully scanning your income and spending patterns. 

In addition to automating your savings, fintech can also automate your payments and spending. For instance, most banking apps allow you to set repetitive transactions for paying your bills, loans, and other expenses on autopilot. This helps prevent you from forgetting your due date and hurting your credit. 

5. It Minimizes Financial Mistakes

With improved financial literacy, you can effectively minimize financial mistakes. That said, to further lower your risk of making mistakes, fintech utilizes technologies such as AI to do the math for you—whether in terms of investment opportunities, day-to-day banking, or loan payments. 

Not only that, but most technology also sends you alerts for overdrawn accounts, payment reminders, and suspicious activity to keep you informed and reduce the risk of financial errors. 

Takeaway

As you can see, fintech can contribute to good financial management. It helps save you time, money, and stress, helping you practice good financial habits and make well-informed decisions about your personal finances. Ultimately, fintech can help you take control of your finances, allowing you to enjoy a more stable financial life.

The post 5 Ways Fintech Improves Your Personal Finances appeared first on FinTech Ranking.

If you’re looking for a way to ensure your business stays within its budget, consider using expense tracking software. They’re easy to use and can help ensure that your company stays within its budget constraints. But how do you choose the right software for your business?

How to choose an expense tracking software for your business

Here are the things you need to consider when choosing expense tracking software for your business.

Research for different expense tracking software

The first step you must do is to research different expense tracking software solutions.

There are many different types of expense tracking software available, each with its strengths and weaknesses. You’ll want to look for something simple, functional, and affordable. And by comparing the features of different systems, you’ll find the one that best fits your needs.

You can start your research by looking at reviews online or asking other businesses what they use.

Meets your business needs

When looking for expense tracking software, you must consider the needs of your business.

For example, if you’re searching for a quick way to track receipts for your employee claims, look for a program that allows you to scan receipts and attach them to a specific purchase or trip. This way, you can monitor every expense and it will be easier for you to perform employee business expense reimbursements. This will also help you save time when filing for taxes.

Here’s another example. 

If you’ve got a lot of employees who need access to different types of expenses and billing information, consider getting an application that offers multiple user profiles. This way, everyone can log in and see what they need to see without compromising security or privacy. 

User-friendly for employees

When choosing an expense tracking software, test it out and try out all the features. 

Ensure it’s easy to navigate and the interface isn’t confusing. If you have older employees with no experience with computers, they may find some programs difficult to navigate or understand. 

You don’t want anyone frustrated while trying to use your expense tracking software!

Data Security

Data security is an important and crucial part of your business, and it’s no surprise that your expense tracking software should offer it.

The right expense tracking software will allow you to protect your business’s data with the following:

• Data encryption
• Email notifications
• Password protection

This gives you the confidence that only authorized users can access the information and that your data will be safe if the system is hacked.

You should also look for a system that offers two-factor authentication (2FA). So that even if they know your password, they can’t access your account since it’s connected to your phone.

Provides great customer support

The best expense tracking software will also come with great customer support. That’s because you’ll need help from the company if you encounter any issues with the software. Likewise, it’s less hassle to get answers from an actual human being than it is to try to figure out technical problems on your own.

If you don’t want to waste time figuring out how the software works, then make sure that the company offers great customer support!

Summary

Now that you know these things to look for, it’s time to find the right expense tracking software for your business. To do this, we recommend getting a free trial or demo version of all of the programs you’re considering. That way, you can get an overview of the software before making any decisions.

Once you’ve narrowed down your list, make sure you clearly understand how much each program will cost and how often they charge fees. Remember, if the offer of the software feels too good to be true, you might want to look for another!

Photo by olia danilevich

The post Tips in Choosing An Expense Tracking Software appeared first on FinTech Ranking.

What Are PFM Services? 

PFM services or systems are originally designed to help government agencies centralize their financial data. Its main functionality is to connect multiple departments or data sources and funnel all the data into a single place, which is often a platform. This is to ensure that government agencies are aware of the organization’s overall financial health so they can act accordingly. 

In other words, PFM services and systems offer government agencies a single solution for planning, budgeting, and forecasting existing financial data in the most streamlined fashion. Though they were initially designed to help government agencies manage their finances, PFM services can be a vital component of the financial strategy of companies. After all, their supposed benefits are perfectly suited to overcome the challenges of financial consolidation. 

What Are The Common Challenges In Financial Consolidation?  

Though the idea behind financial consolidation is quite simple, it can be tricky, especially if the organization is large. Below are some of the most common challenges it may pose:  

• Manual data entry errors: If an organization’s financial consolidation process involves entering financial data manually, there’s a high possibility of data inaccuracies. Missing digits and duplicate values are examples of these errors. 
• Calculation errors: Just like data entry, it’s also possible to make calculation mistakes, like using the wrong formula and converting currency incorrectly. 
• Financial consolidation can get tedious: An organization will most likely have several financial statements from different departments and subsidiaries. To consolidate all the data, the company must invest a few days or weeks of work. 
• Integration issues: It’s not uncommon for every branch or department of a company to use different reporting tools. While it may not pose a problem initially, the disparity between the systems can result in an even more tedious consolidation.  
• Reporting compliances are continuously evolving: Financial reporting standards, compliance regulations, and statutory requirements are continually changing. As the company grows, it becomes more difficult to keep up with these constant changes.

How PFM Services Overcome Challenges In Financial Consolidation 

While there’s no one-size-fits-all solution to overcome all these challenges, PFM services have proven to be quite helpful in that regard. Here’s how PFM services can help with these issues. 

1. PFM Services Promote Full Traceability 

PFM services aim to create a system where you can trace every piece of data back to its source, whether it’s from a different department or a separate subsidiary. With full traceability, this means that if a piece of data that isn’t supposed to be in the system finds its way to the platform due to an employee’s or worker’s mistake, the software can quickly detect the mishap and rectify the error. This minimizes the likelihood of manual data entry and calculation errors in financial consolidation. 

2. Automates Tedious Finance Tasks 

One of the main selling points of modern software is automation. PFM systems are no exception, as they’re known for automating numerous tasks, including particularly tedious ones. 

Currency conversion and calculations are examples of tasks that PFM systems should be able to automate to some degree. Not only will this automation accelerate the financial consolidation timeline, but it can also reduce the likelihood of errors caused by manual work. Certain PFM service providers can even automate the financial data collection process altogether. 

3. Provides An ERP System 

Most PFM services come with an Enterprise Resource Planning (ERP) system. The system consists of applications that are already integrated with one another. Though it’d require a company to overhaul the existing reporting systems of each department or branch, it can help significantly in future financial transactions. There would no longer be a need to manually connect data sources, as they’re already connected with one another through the system. 

4. Highly Configurable 

When performing financial consolidation and creating reports, a company must comply with international, local, and industry-specific requirements. Otherwise, the organization can be fraught with legal troubles for allegedly misrepresenting accounting to manipulate share prices.  

PFM systems can be a solution to this problem as they often have highly configurable requirements. What that means is you can add, remove, or edit statutory, compliance, and reporting requirements in the system. By doing so, you can ensure the platform handles financial data in compliance with the requirements and regulations that apply to your company. 

The Bottom Line  

As much as you’d like to invest in PFM services right away, one must keep in mind that it’ll bring a huge change to the company. Not only that, but it may also take a while to deploy the system if you push through with the decision. As such, it makes sense why you’d want to learn more about the service first. At the very least, you now have a better understanding of PFM services and how beneficial they can be to your organization, specifically with financial consolidation.

The post How PFM services can help to overcome challenges in financial consolidation appeared first on FinTech Ranking.

We can never know what might happen to us tomorrow. We might urgently need money because we’ve lost our jobs, our cars have broken down or we require costly medical services that our insurances fail to cover. To cope with such situations, you might want to have an emergency fund. From this article, you’ll get to know how to create it and make the most of it.

What Is an Emergency Fund?

Some people might call it “a rainy-day fund”. It’s money that you’ve set aside for life’s unexpected events.

You might wonder, what’s the difference between an emergency fund and a regular savings account? If you have the latter, you can use money from it for any purpose. For instance, you can buy a new car or pay for your child’s education. As for the emergency fund, you should never use the money from it for any other purposes, apart from something urgent and rather unusual.

How Much Should You Save for Your Emergency Fund?

If your emergency fund contains six months of your average expenses, it should be enough to make you feel comfortable. If this goal seems unrealistic to you now, you might start with saving at least three months of your average expenses. The more stable your income and household are, the less you need in your emergency fund.

You should strive to have a six-month fund if you meet one of the following criteria:

• Are a one-income family
• Are self-employed
• Earn straight commission

If you’ve had a steady job for several years or are a part of a two-income household, it should be easier for you to pay your bills in case of an emergency — so you might feel secure with a three-month fund.

Where Should You Keep Your Emergency Fund?

Your emergency fund should be liquid. You should keep your savings in a place where you can get to them easily and quickly. You can consider opening a simple savings account connected to your checking account. Alternatively, you might use a money market account that comes with a debit card or check-writing privileges.

Mind that you shouldn’t simply add the money that you regard as your emergency fund to your checking and savings account. You might want to use the services of different banks or even spread your emergency fund between several banks if it’s large enough.

A useful tip: online banks might pay higher interest rates. So you might want to choose the one that enables you to transfer money quickly and directly to your checking account.

How Can You Build an Emergency Fund?

To build a substantial emergency fund, you might want to rely on the following four rules.

Make a Budget and Live by It

If you’re not using a budget-planning tool yet, it’s time to get started. You can download one of the popular mobile apps that help you analyze and control your monthly expenses. It will show how much money you spend on each category of products or services. At a glance, you’ll understand how you can cut down your expenses and find money to transfer to your emergency fund.

Get Cash Back

Again, you can install an app that will help you to purchase products with maximum cashback. As soon as you receive this money, you should add it to your fund. Such an approach adds an element of gamification to the process of saving and you can have great fun while sticking to it.

Set a Monthly Savings Goal

You shouldn’t deprive yourself of things that you seriously need. You should set a realistic goal that you’ll be able to meet. If you get your salary once or twice per month, you should put aside some part of it as soon as you get the money. In a couple of months, you’ll feel proud that you have managed to accumulate a certain sum and it will be easier for you to go on.

Try to Put Aside More Money When You Have a Chance

You or your spouse might get a promotion at work, you might win a lottery or inherit some money. Don’t hesitate to add that extra income to your emergency fund. This will enable you to achieve your saving goal faster than planned.

How Can You Start an Emergency Fund Quickly?

People who would like to create emergency funds in the shortest possible time normally resort to the following measures.

• Try to boost their income. They start side businesses, take on part-time jobs and offer useful services to their neighbors.
• Adjust their tax withholdings. You might consider doing so if you get a big tax refund each year. Many people spend this money on impulsive shopping. But you might try to exercise your willpower and use this sum to start your emergency fund. Consider this tax refund as an interest-free loan that you’ve let the government hang on to for you all year.
• Sell stuff. What do you do with clothes, furniture and other objects that you don’t need anymore? Do you throw them away or give them to charity? What if you try to sell them? You can do it either on social networks or on sites that specialize in this type of sales. Even if each object costs no more than $10, you might end up earning hundreds of dollars in a few months.

Starting from scratch is always the most difficult part. If you manage to start an emergency fund quickly, that should motivate you to save money systematically.

Final Thoughts

Hopefully, this article came in handy and now you better understand the importance of having an emergency fund. This type of savings can help you in any unexpected life situation. Try to save a sum that equals six months of your expenses. To get started, you might want to sell your old stuff, adjust your tax withholdings and find sources of additional income. You might want to open a new bank account for your fund and install a budget-planning app.

The post Emergency fund: why do you need it and how can you build it? appeared first on FinTech Ranking.

SoftBank Latin America Fund and affiliates of China-based Tencent co-led the round, which included participation from a slew of existing backers, including funds managed by Soros Fund Management LLC, funds managed by affiliates of Goldman Sachs Asset Management, Ribbit Capital, Greyhound Capital, Monashees and Endeavor Catalyst. New funds, such as D1 Capital Partners and 166 2nd, also put money in the round in addition to angel investors such as Jacqueline Reses and Isaac Lee.

Read more: TechCrunch

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The fintech raised $150m in a round co-led by Bain Capital Ventures and Thrive Capital, with Keri Gohman, partner at Bain Capital, joining Pleo’s board of directors. 

Read more: AltFi

The post Pleo secures unicorn status with $150m Series C fundraise appeared first on FinTech Ranking.

If you are you an entrepreneur or an established business owner? In that case, you must know gathering funds to invest in your dream business and turning it into a reality is not a cakewalk. However, to survive and thrive your business in today’s competitive business world, you should be well-versed in financial skills to help grow your business. Put it this way, the better you manage your finances, the more chances your business can achieve its target and be successful. 

Is your mind still in conflict about whether learning financial skills can take your business to the next level? Then, read on below to get a clear picture of how your financial skillset can aid you in building and growing your business:

1. HELPS IN FINANCIAL PLANNING

Every business owner wishes to fulfill their consumers’ demands and achieve the business objectives. However, how can you do that if you have no prior financial knowledge or financial management skills? Setting business objectives is not easy. You need to conduct proper research to gain insight into your finances and learn customer behavior. 

Keep in mind; you need to analyze financial statements and reports to formulate a robust financial plan. For this reason, you can pursue an advanced degree to gain the relevant knowledge and skills that prepare you to tackle financial problems. Are you finding it challenging to seek further education while running your business? No need to worry. If you already have a bachelors degree under your belt, enroll yourself in an online master of accounting program and learn while focusing on your business survival and growth. In addition, online courses provide you better time management skills with added flexibility and self-paced learning. The degree further helps you gain insights into various business areas such as tax planning, auditing, financial and management accounting, etc. Having financial plans beforehand can save your business from going into bankruptcy. On the other hand, without a solid financial plan, chances are your company might get into the hot waters. 

2. MANAGE CASH FLOW

Let’s admit it; nothing harms the company more than the poor management of the cash flow. Simply put, cash flow is the amount of money that flows in and out of a company during a specific period. Better management of your cash flow can help you pay off your debts and bolster your business operations. However, having extra funds that are not in some use can lead to resource wastage. So make sure to utilize the surplus money in some better investments that can help you grow your business. 

3. AIDS IN ALLOCATING FUNDS

Picture this; your business in dire need of purchasing an inventory to complete its operation. However, you are low on cash and can’t buy it. To save yourself from such circumstances, having excellent financial skills can help you allocate funds appropriately. If you learn how to properly allocate your finances, then you will be able to allocate some of the money for travel and hobbies, in addition to business. Even if your hobby is playing poker or roulette at the best online casino in Canada.

Your business must have sufficient funds to manage the day-to-day business operations such as purchasing raw materials and inventory, utility bill payments, employees’ salaries, and much more. Proper financial management skills can help you cut down business costs and increase the efficiency of your operations. Conversely, failing to allocate funds appropriately can cause hindrance in operations and overall growth significantly. Thus, a sound financial plan can help you allocate funds to keep your operations going smoothly.

4. TAP INTO NEW OPPORTUNITIES

Chances are, your customers are satisfied with your services or products. Therefore you plan to set up another branch for your services in a different location. Maybe you have set your eyes on a new inventory or another exciting opportunity. Whatever the case might be, you need to have sufficient funds to grab the opportunity and flourish your business. For this reason, having sound financial skills can help you leverage opportunities. Make sure to build an effective and clear finance strategy to work strictly within the available funds. A best practice is to use retained earnings to avail opportunities. 

5. MITIGATES RISKS

There is no denying that running a business is full of highs and lows, no matter the size and type. One moment your business is booming in the market, and the next, it might undergo recession. However, if you have an effective financial management plan in practice, your business can avoid any downfall or complete shutdown.

While financial skills vary depending on the job role, some common ones include accounting, analytical, communication, etc. For example, suppose you wish to thrive in the highly competitive business industry. In that case, you must be well-aware of your company’s financial health and keep track of any potential risks. Doing so can assist you in eradicating the threats at an earlier stage and achieve long-term success. Thus, possessing excellent financial skills can help you solve financial problems in your organization and save your business from any unforeseen circumstances.

FINAL WORDS

Irrespective of the size and type of your business, finance is one of the most critical aspects of your business. It doesn’t matter how good your product or service is, which advanced technologies you use, or how effectively you run your business. All your efforts and resources will fall by the wayside if you lack financial skills. Gaining financial knowledge and skills can help manage your funds and execute business operations more efficiently. After all, the success of your business depends significantly on the financial health of your organization. 

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