The industry of financial services, particularly in Asia, is a sector that has seen rapid growth. Mobile payments and cloud accounting software are two technological advancements that have radically changed how businesses interact with customers and operate.
According to 90% of accountants, the cultural shift within the accounting industry has led to technological change.
Accounting firms have traditionally been based on providing advisory and compliance services to clients. Fintech has brought a new breed of startups challenging the status quo and offering innovative services to shake the industry.
What is Fintech?
Fintech (financial technology) is any technology that provides financial services through software, online platforms or apps. Examples include online banking, mobile payment apps or cryptocurrency. Fintech is an umbrella term that includes a variety of technologies. However, the primary goal of fintech is to transform how consumers and businesses obtain their financial services.
Fintech and the Accounting Industry
Here are some prominent ways that fintech is changing the accounting industry.
- Automation levels up the game
Fintech also drives change in the accounting industry through artificial intelligence and automation. Automation has made processes such as credit control, forecasting and invoicing, cash flow reporting, and reconciliation significantly easier and faster. It frees up resources and time and allows businesses and accountants to take a calculated and strategic approach.
- Enhances productivity and decision making
Businesses can get ahead with streamlined automation, real-time access to reports and data, better forecasts, and cash flow analysis. With this at their disposal, business owners can become proactive instead of reactive. Fintech allows them to see the future more clearly and make better budgeting and contingency plans.
- Unprecedented Data Access
It is now possible to access data at any time. Cloud-based accounting software was born out of this need. Anyone with access to the internet can view financial information in real-time, anywhere and anytime. Due to technological advances, fintech companies have real-time access to financial data and reporting. Fintech companies can make informed decisions and respond instantly to changing economic situations. It also gives you better insight into budgeting, resource management and forecasting.
The Impact of Accounting Technology on Business Decisions
Businesses can now make better-informed and more responsive decisions thanks to faster access to data and insights. Automation of processes also allows companies to spend more time on their core business.
Integrating tools and software has made it easier to manage finances for businesses. Cloud-based accounting software allows companies to work from anywhere in the world.
Accounting’s role has evolved from compliance and taxation to advisory and consultation. The need for businesses that offer more value-added services is driving this change.
AI, automation, and cloud computing in accounting systems take on many accountants’ time-consuming, traditional tasks. This has the potential to save time and money.
Five Technologies that are Transforming Accounting and Bookkeeping
- Cloud Technology
The cloud is a game changer for the accounting sector. Cloud technology has enabled accountants and bookkeeper’s access to client data and the delivery of financial information and reports via the cloud from anywhere. It has made working remotely on client accounts and collaborating with clients easier. This has also allowed accountants to engage with clients and encourage strategic tasks instead of tedious paperwork.
Blockchain is an open-source distributed database which allows for secure, transparent and tamperproof transactions. It could revolutionize the accounting sector by making it easier for people to track financial transactions and reducing the likelihood of fraud. Blockchain could make it easier for financial records and statements to be audited.
- Tax Software Innovations
Fintech features simplify tax compliance, a crucial aspect of accounting. As powerful accounting software and cutting-edge tools are introduced, a new era in tax management will begin. Automation is a powerful tool that allows you to streamline calculations, create flawless reports, and ensure compliance with constantly changing tax regulations. Businesses can navigate complex tax landscapes more efficiently, reducing errors and penalties. These tools help companies to achieve a higher level of efficiency and financial success.
- Mobile Apps
Mobile apps are redefining the way business is run. Accounting software allows you to access financial data anywhere, anytime. You can create and send invoices, track expenses, and reconcile transactions.
- AI & Robotics
Automating repetitive and time-consuming activities such as data entry and invoicing can save you much time. This will allow accountants and bookkeepers more time to concentrate on other tasks.
| Read More: RPA in Accounting
How Fintech has Changed Accounting?
The development of fintech has accelerated the flow of financial data. Fintech accounting continues to be revolutionized by applications such as Stripe and Fresh Books. Software for cloud accounting is also a popular option.
Although not all fintech businesses are fully modernized, the fact remains that manual invoicing and payments are costly and out-of-date. Cloud-based accounting software automates fintech businesses’ bookkeeping, tax filing, and accounting functions.
Automating processes will reduce costs and help businesses get paid faster. The customer will enjoy greater efficiency, lower prices, and a higher value of services.
However, while this does not mean that traditional accounting software like QuickBooks, and bookkeepers/accountants, are not playing an essential role in accounting, the importance of this conventional software is reducing daily.
Fintech employees are also affected by automation in different ways. The new technology should be embraced by employees rather than viewed as a threat. Automation saves time, which can be used to train employees, increase clientele, or improve work-life balance.
Fintech companies and their accounting service providers should keep up with changing trends to reinvent the fintech industry’s roles.
Fintech innovations are changing the accounting industry. They empower businesses with tools and technologies to improve financial management, decision-making, and efficiency. Accounting professionals and bookkeepers can now focus on activities that will drive industry growth, while companies can take advantage of accurate financial insights and streamline processes. Accounting professionals must adapt to new technology and embrace changes as it develops.