For Gig Workers and Entrepreneurs, Business Banking Done Digitally

For the smallest of firms — think gig workers and “sole traders” — banking by app?

Amaiz, a FinTech based in the United Kingdom, earlier this month said it is debuting a mobile banking app geared toward entrepreneurs.  The solution offers invoice generation and submission and the ability to manage expenses.

The company said in an announcement that the solution, aimed at gig workers, entrepreneurs and contractors, can let those individuals and small firms do away with outsourced accounting services. Among other features, according to the announcement, the app sports the ability to connect those workers with Mastercard business cards and direct debit functions.

In an interview with PYMNTs, Steve Taklalsingh, Amaiz managing director & CFO, said that entrepreneurs are increasingly interested in a mobile-first option for banking as millennials and Gen Zers have grown up with the internet as a major part of their lives.  “They are natural entrepreneurs, used to finding out how things can be done, how they can be done better, why they can’t — and if not how to fix things to suit their lifestyles,” he said, adding, “the message now is very much ‘If you can’t deliver what I need, with the products to suit, I’ll find someone who will.’”

The Mobile Banking Advantage

Since entrepreneurs tend to embrace technology in general, said the executive, there is a natural synergy at play. As he said, “Entrepreneurs look for banks that are like them — and apps do this best.”

He said that for many smaller firms, taking on the services of a full-time accountant or monthly paid accounting software is not a suitable option.

“They exist in a unique space,” said Taklalsingh, “and need some accounting help, maybe quarterly, maybe once a year for self-assessment. Amaiz aims to be the bridge between an accountant and a limited company.  Ideally, we will continue to see a move towards minimizing and automating these processes.”

Traditional accounting services fail to provide a live view of the finances of a company, working off of historical data that may not accurately reflect the current financial state of a business.

With mobile-only banking, the user can get a live view of their finances. For example, a lot of banking apps provide entrepreneurs with a live expenses category breakdown in the palm of their hand on a banking app or things like tax estimators, which a traditional accountant or a conventional High Street bank wouldn’t be able to offer.

Beyond accounting functions, Taklalsingh said almost all business banking-related tasks can be efficiently sorted with mobile apps, which means that the entrepreneur has a full picture of their financial health, plus control over finances. These features ultimately reduce the amount of time entrepreneurs spend on doing business administration activities, said Taklalsingh.

He told PYMNTS that challenges arise with services on offer from many traditional players.  Entrepreneurs and freelancers may find it onerous to navigate through all the unnecessary features that he said “suit all businesses and none at the same time.”

Consider the example of a sole trader who has to schedule an appointment with a High Street bank and “it’s an appointment which may not be available for several weeks in some instances. They will then have to find the time to visit a High Street branch, wait to be seen by a staff member, discuss their business in detail, take along a pile of paperwork and wait three weeks for the account to be opened while losing, in total, around six weeks — instead of simply doing their business.”

There also exists some imperative to embrace digital banking, he noted, as in the U.K. the government has an initiative in place to make tax collection digital. Many small businesses, he said, still are paper-based and face significant challenges in getting information converted to an electronic format.

Technologies and functionalities such as in-app tax estimators, the ability to submit VAT returns from banking apps (as part of making taxes digital), and raising customer invoices from banking apps will, in Taklalsingh’s words, “shift customers who bank with High Streets to challenger banks.”

The fact that technology is readily becoming more affordable for even the smallest of businesses may also prove a tailwind for banking done digitally and across mobile conduits.  Taklalsingh pointed to the continued traction of cloud computing and data warehouses, which have made it possible for smaller firms to access software as a service and platform as a service offerings. Big Data makes access to insights about customers affordable as well, he said.

“Some sole traders are even incorporating Messenger Chatbots into their own businesses. Customers no longer need to pick up the phone or fill in an online order form. Instead, they’ll log into an app and quickly place their order on Slack, Facebook, Whatsapp, or other chat app,” he said.