Banking is the most fundamental form of managing finances. Whether your use is personal or official, you rely on banking and its services. And, if you have a business of your own, you definitely know the importance of business banking. Today, we’ll take a look at business banking and understand the new age forms of using these services.
What is business banking?
Business banking is the process of a third party managing your company’s finances by providing loans, credit, savings, and current accounts that are especially designed for businesses instead of individuals.
Business banking helps keep your funds safe while providing you with a clear view of your business’s financial health. You also get additional perks that you won’t receive with a personal account.
Methods of business banking
Business banking can be carried out in a few ways.
A physical branch – This is the traditional way of business banking where are your transactions will be processed at a branch.
Online banking – This method of banking has become increasingly popular because of the ease it provides to the customers.
In online banking, neobanking and open banking have opened up a whole new avenue of services that primarily focus on experience while providing your business with the best possible solutions for money management. Let’s take a closer look.
What is neobanking?
It is a type of digital bank that does not have any physical branches. Unlike a traditional bank that has a branch at a specific physical location, a neobank is entirely digital and online.
Think of a neobank as a cluster of financial service providers who cater to today’s tech-savvy consumers. Without a license of its own, a neobank leans on bank partners to provide bank licensed services to its customers.
How does neobank help with business banking?
Often, businesses have to deal with tedious, never-ending processes that involve disbursals and payments. These processes result in hours and hours of manual efforts due to buggy software, complex infra systems, and many other reasons. This complexity may further grow into fiddly money movement views.
Business banking via neobanks helps solve all these problems.
- Account creation is a breeze since neobanks are completely online; they don’t have a storefront. All it takes are a few minutes and a couple of simple steps on a smartphone
- With friendly UI, you can provide the best user experience to your customers
- Business banking with neobanks helps take your business to any part of the world
- Neo-apps help manage your finances by providing you with an overview of your expenses and a savings goal that matches your needs
- You can save 10x time because of reduced manual effort and instant payouts
- Make, track, control, and analyse all forms of money movement, all from a unified platform
- You can also track and manage money movement to vendors, customers, employees, and more, with the in-depth Financial CRM
- Use APIs that are easy to deploy and integrate banking into payments and accounting infrastructure
- Make informed, impactful business decisions with off-the-shelf analysis on payouts mode
Neobanks also provide current accounts since they support higher volumes of transactions.
Read more: Everything You Should Know About Neobanking
What is open banking?
Open banking involves sharing financial information digitally and securely, with customers’ approval. The use of APIs enables third-party developers to build services and applications around a financial institution. This drives speed while keeping costs low when compared to traditional systems.
A combination of rich bank data and disruptive fintech results in financial products that provide both businesses and customers with the best of both worlds.
How can you improve your business banking with open banks?
The utilisation of APIs by banks has become very progressive all around the world, and for good reasons. With API banking, innovators have more flexibility to provide the best features and services to streamline financial services, thereby creating a surge of competition and innovation in fintech products.
Use cases for API banking
The most common use-case for API banking is payouts.
Lending: In the last year, the consumer lending industry saw a meteoric rise. And, with increased competition, the speed at which loads are processed became a top priority.
Today, RazorpayX has helped many lending companies reduce the average time to process a loan from 3 hours to 30 seconds.
Gaming: Gaming is an industry in which instant gratification reigns supreme – winners want to claim their prize instantly. 40% of the real-money gaming industry in India uses RazorpayX to disburse winnings to their users.
Open banking provides solutions for all your business banking needs.
- Have more transparency, knowledge, and options when it comes to managing your finances, and find a tailored solution that fits your business case
- With real-time capabilities, get enhanced visibility of cash flow, cash position, and more, across currencies
- Reduce administrative hurdles with regard to managing your finances like applying for a business loan, checking your creditworthiness, and more
- Be in control of your data as you decide how to use it or who gets to access it
- Set targets on savings and expenditure, ration your finances logically while being able to account for each and every financial activity
- Have a single view of all your finances while being able to control, track, and analyse all financial movements, all in one place
Suggested reading: 2020 – The Year for Neobanking in India
RazorpayX – business banking experience like never before
With RazorpayX, businesses can manage their entire financial operations and make timely payouts using our sleek dashboard or robust API. Businesses like CureFit, MPL, Dunzo, and others use RazorpayX to make payouts at scale via API while keeping costs low.
This also helps them ensure their customers and partners are happy. RazorpayX Current Accounts takes business banking further by including all standard banking services like debit cards, accounting statements, cheque books, and more.
Surely, you’d want to manage your business’s money better, with more control and efficiency. Neobanking and open banking can help streamline and automate your business banking at scale.