Mahi Sall, Advisor, Fintech-Bank Partnerships, Payments and Financial Inclusivity
January 25th, 2023
Guest Post | Aug 5, 2022
Emerging technologies touch nearly every aspect of the business world, and that includes the accounting department.
Financial technology — or fintech for short — is any technology that supports, automates, or enables a company’s or individual’s use of financial services.
In the accounting department, fintech helps accountants do their jobs more efficiently. But fintech can also free up accountants’ time so they can focus on meeting the strategic needs of the business. Rather than simply supporting other departments, accountants can be the changemakers themselves.
Before we delve into how fintech can add value, let’s talk about a few specific technologies that have transformed how accountants do their jobs.
Automation technology has been around for some time. When you think about the most popular automation programs on the market today (Excel, Quickbooks, TurboTax, etc.), it’s likely that nearly every business across the globe uses some form of automation technology in their accounting department.
But there are newer computer programs that take automation one step further. For example, computer technology can now automatically perform month-end close tasks like reconciliations, payroll, and financial reports. Additionally, software like Expensify and Dext use Optical Character Recognition (OCR) to gather data from a PDF or a photo.
Robotic process automation (RPA) is a technology that mimics human keystrokes on a computer. This technology operates by programming the computer to follow a set of rules: If X happens, the computer will take Y action.
In accounting, RPA can:
—and so much more.
Intelligent automation (IA), like RPA, mimics human keystrokes on a computer, but it can do so without following strict “if X, then Y” rules. IA uses artificial intelligence-enabled programming to, for example, read a client email and take an action based on what it sees, or automatically authorize an order by checking the work order against progress reports, accounts receivable, and inventory.
Blockchain technology relies on the premise that all human- or computer-initiated transactions are stored in the blockchain indefinitely. Future users can see what transactions prior users executed, which makes blockchain a secure and transparent way to transact business. Blockchain can:
Because all transactions are recorded in the blockchain, there is a simple way to spot asset misappropriation.
Because the blockchain is decentralized, more than one user can access it at once. In real-time, auditors can gather information about the business without disrupting the day-to-day activity of the accounting department.
Blockchain introduces a truly secure way to transfer property rights between businesses or affiliates.
New technology takes time and effort to adopt (and even more time to learn how to use to its full potential), but once you do, your department will see just some of the following benefits:
If your staff are more efficient at their jobs, they can spend their time on more important things. Instead of entering data or checking another person’s work for accuracy, they can focus on strategic tasks that cannot be accomplished by a computer program — things like collaboration with other departments, finding creative solutions to long-held inefficiencies, and interpreting information that helps the C-suite make better decisions.
When businesses base their decisions on current and accurate data, they reduce their risk of making an unsound investment or decision. Additionally, fintech programs can reduce the risk of fraud. They can trace transactions more quickly, and if fraud is discovered, it can be contained quickly.
Humans provide value to businesses — there’s no doubt about that — but their value does not come from their ability to tick and tie numbers. Computers can perform simple arithmetic and complex calculations, and they can do much better than a human ever could. Businesses that use fintech to their advantage will make fewer errors and have more accurate reports.
Fintech’s automation capabilities reduce time needed to complete tasks, and when time equals money, the cost savings add up quickly. Fintech for payment services can also save the company money by optimizing when payments are made and how quickly checks are deposited. When payments move faster, the business has access to cash sooner and can use that cash as leverage in new strategic pursuits.
Fintech can be as complex or as simple as your company needs it to be. Start small, understand your technology, and move from there. Even adopting simple automation programs can greatly impact your department’s work and your employees’ experiences while on the job, so do your research and see how fintech can help you.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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