Competition in Financial Technology | Study

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COMPETITION IN FINANCIAL TECHNOLOGY

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COMPETITION IN FINANCIAL TECHNOLOGY
The term Fintech is a portmanteau of the words finance and technology. Fintech refers to
the technology that seeks to improve the use and delivery of financial services. The world of
supply chain finance has been shifting over the years with the introduction of Fintech industries
who act as brokers between buyers and sellers. These companies have used technological
innovations and traditional banking systems to improve the transaction between buyer and seller,
ensuring they both benefit from the trade. These companies improve transactions by increasing
working capital, reducing contract payments, and offering favorable payments for both the buyer
and the seller. These supply chain finance Fintech companies ensure a deal where the supplier
can get paid in 10 days, whereas the buyer can pay between 30- 120 days within the same
agreement (Flaherty, 2019). This transaction is procurement using Fintech platforms. In this
paper, I will explore the competitive landscape of the existing supply chain Fintech, and I will
discuss the value proposition of Monimove, which is one of the most promising corporate supply
chain finance platforms in the Fintech industry.
Fintech companies in the supply chain environment are highly competitive. They use
different strategies and techniques to stay ahead of the competition. The tech industry is a
volatile market, with innovations constantly flooding the scene. For a company to succeed, they
are required to be agile and continuously refresh their products. The global Fintech industry is a
booming field that received an investment of $17.4 billion in the year 2018 alone (Browne,
2017). Fintech helps companies and business owners to better manage commercial operations by
using software and algorithms. However, well-established Fintech companies do not have
trouble in the acquisition of customers since they have already broken the customer adoption
barrier. Approximately a third of the world population is estimated to be using two or more

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Fintech applications in their consumer endeavors. Technological advancements, evolving
customer expectations, and the ever-expanding economies are some of the factors that drive the
demand for Fintech (EY, 2018). Many financial institutions have joined Fintech startups either as
a partner or as investors. Almost 80% of financial institutions have partnered up with Fintech
companies, according to a recent survey (Galvin, et al., 2018). This phenomenon might be owed
to the fact that most of these financial institutions are becoming obsolete.
Fintech has transformed the face of the global supply chain by acting as an intermediary
between companies and their suppliers. These companies improve the working capital by
extending the buyer's payables and accelerating payment to the suppliers. This technology
benefits the company by providing greater liquidity and reduced variables in payment. The
Fintech industry is becoming more competitive, with constant startups that threaten the previous
Fintech. There are many startup Fintech companies in the Fintech supply chain industry.
However, only a few get to become successful in this highly competitive industry. Different
Fintech companies use different structures in their transactions. However, the underlying
structure starts with the buyers' purchase and ends with the supplier receiving the payment.
Several factors determine the likelihood of a company's success. These "pillars" in the Fintech
ecosystem include sustained demand, access to capital, regulatory openness, talent availability,
and an enabling environment.
A supply chain finance Fintech Company achieves a sustained demand when its product
is digitally compatible and ready to penetrate and access financial services for the consumer.
Additionally, the company needs to have access to risk capital, strategic capital, and growth
capital, all of which are used in the sustainability of the company. Furthermore, the company is
required to meet Fintech laws and regulations that include taxation laws, credit availability,

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regulatory sandboxes, and visa policies. Moreover, the company should attract, up-skill, and
retain their employees. This strategy ensures the growth of the company's performance. All in
all, the company must have an enabling environment that is strong, scalable, and sustainable.
Fintech companies in the supply chain industry are known to use various techniques to keep up
with the competitive industry. They use widely applicable applications and complex applications
such as big data and artificial intelligence.
Cryptocurrencies have become a widely used tool in the Fintech industry. These
currencies are digital, decentralized, and they use encryption. They are independent of the central
bank or the government. Ether and bitcoins are among the most popular forms of
cryptocurrencies that exist in the market today. These virtual currencies give some Fintech
companies a competitive advantage over other companies. Additionally, there are other
techniques such as Blockchain, which is a form of a distributed ledger. This ledger keeps all
records of cryptocurrency transactions throughout a network of computers without a central
ledger. This technology is used by Fintech companies to maintain an efficient operation
throughout the company's endeavors. Other techniques, such as the Ethereum, uses the
Blockchain technology to build a decentralized application. This application allows users to
interact directly with each other without third party connectivity.
The Fintech ecosystem can be fit into several categories, all of which are timing with
Fintech companies. There are robo-advisors and personal finance services. These platforms use
financial algorithms to automate investment advice. They include Moneyfarm, Robinhood,
Nutmeg, Addepar, Hobito, and Motif, to name a few. There are Regtechs. These regulatory
technology companies aid firms who work in the financial service industry to meet business
compliance regulations. They include Viclarity, Corlytics, Sovos, Accudelta, Contego, and