Not exactly fintech but somewhat related: Manual bookkeeping.
I suppose though that probably short of artificial general intelligence there’s no one-size-fits-all solution for this because bookkeeping is too varied and complex.
If everyone agreed on a digital standard for sending invoices and receipts that’d be a first step (no, that standard isn’t PDF). Unfortunately, as long as there are even companies that still send paper invoices we still have a long way to go.
If you're a big enough company or work with big companies there are actually a few "standards". Retail, energy and healthcare among others use EDI. It would certainly be nice to have one for small companies as well
Book-keeping as a whole might be too complex and varied, but you can split the problems into smaller pieces. For a start, split accounts payable and accounts receivable. Then, within AP, split between invoice entering objective data, matching against purchase orders, getting payment authorization, and coding appropriately.
Some of these part need some company-specific work flow, but not much intelligence so can be coded by any internal dev team. But some parts (e.g. extracting the objective info from PDF or scan) are harder but more standardised, and could be provided as an API. Some other (allocating to the right accounts in the GL) should be automatable for 90% of invoices, just because most received invoices are for the same thing each month.
I’ve seen too many fintech pitches that go something like:
Fintech: here is our amazing solution to a problem you didn’t even know you had!
Banker: oh you mean like <some common piece of banking terminology>
Fintech: blank stares
A fintech that is all ex-bank who spun off to solve a problem they knew they had, will probably succeed. A fintech that is all web devs solving problems that they only imagine exist will not.
A) There's no problem to be solved (which I think is your point), or
B) The problem looks unsolved because it's harder than it looks (e.g. payment fraud).
But I imagine there are spaces (e.g. consumer payments) where a pair of fresh eyes wouldn't suffer from either of the above.
I don't know whether companies like Revolut or Transferwise were founded by ex retail bankers, but I could imagine someone from outside the industry identifying the problems they solve, purely from their customer perspective.
Also C) what they propose would be illegal under the regulatory regime of at least one jurisdiction the bank operates in, and that’s the only reason the bank hasn’t already done it
could imagine someone from outside the industry identifying the problems they solve, purely from their customer perspective
So the sad thing is fintech startups do not really solve things for now. They just push some banks to improve their tech.
Here is a real issue: transaction speed of SEPA wire transfers.
Here is another issue: no fintech will be able to solve it, since fintechs are no banks, and (typical for "disruptive" startups) can not solve this for the whole system as it is a regulated system for tons of reasons.
So what could fintech really solve?
How about focussing on customer facing technology? A fintech proposing and providing an open standard for banking apps where security and compliance is enforced by default would at least one problem solved.
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[ 3.2 ms ] story [ 42.0 ms ] threadI suppose though that probably short of artificial general intelligence there’s no one-size-fits-all solution for this because bookkeeping is too varied and complex.
If everyone agreed on a digital standard for sending invoices and receipts that’d be a first step (no, that standard isn’t PDF). Unfortunately, as long as there are even companies that still send paper invoices we still have a long way to go.
Some of these part need some company-specific work flow, but not much intelligence so can be coded by any internal dev team. But some parts (e.g. extracting the objective info from PDF or scan) are harder but more standardised, and could be provided as an API. Some other (allocating to the right accounts in the GL) should be automatable for 90% of invoices, just because most received invoices are for the same thing each month.
Fintech: here is our amazing solution to a problem you didn’t even know you had!
Banker: oh you mean like <some common piece of banking terminology>
Fintech: blank stares
A fintech that is all ex-bank who spun off to solve a problem they knew they had, will probably succeed. A fintech that is all web devs solving problems that they only imagine exist will not.
A) There's no problem to be solved (which I think is your point), or
B) The problem looks unsolved because it's harder than it looks (e.g. payment fraud).
But I imagine there are spaces (e.g. consumer payments) where a pair of fresh eyes wouldn't suffer from either of the above.
I don't know whether companies like Revolut or Transferwise were founded by ex retail bankers, but I could imagine someone from outside the industry identifying the problems they solve, purely from their customer perspective.
could imagine someone from outside the industry identifying the problems they solve, purely from their customer perspective
That’s a fair point
The tech is easy, meeting compliance and getting other businesses to integrate not so.
Here is a real issue: transaction speed of SEPA wire transfers.
Here is another issue: no fintech will be able to solve it, since fintechs are no banks, and (typical for "disruptive" startups) can not solve this for the whole system as it is a regulated system for tons of reasons.
So what could fintech really solve?
How about focussing on customer facing technology? A fintech proposing and providing an open standard for banking apps where security and compliance is enforced by default would at least one problem solved.