Finance Monthly - December 2021

Finance Monthly. Tr a ve l & Li f e s t y l e 77 are spending and where they are spending it, as well as any fees they incur for things like FX exchange if payments are made overseas. The COVID-19 pandemic also brought the way SMEs deal with expenses into sharp focus for other reasons. All of a sudden, people needed to work from home and many of them didn’t have the correct equipment — laptops, monitors, keyboards, desks, chairs and so on — so they had to stump up their own cash and claim the money back. The alternative was days or weeks of inactivity; something that no business can afford, no matter its size. The situation was far from ideal but many smaller organisations had little choice but to do it this way. It’s true to say that the SME sector is one of the most neglected segments when it comes to financial services — for many banks, it’s seen as an unprofitable area, and they’d rather focus on the large corporate clients where there is much more money to be made. SMEs are also not usually the target of the cutting-edge, user-friendly financial products that proliferate in the consumer market. Massive market opportunity However, SMEs are typically digital-savvy, lean organisations that welcome innovative solutions. It’s a shame, then, that when it comes to banking they often have to use services that are expensive and designed for much larger organisations. While we’re starting to see FinTech companies targeting SMEs in markets like Spain and Germany, these tend to be focused on providing access to finance. There is still a big opportunity for new entrants to the market who can address the very specific needs of companies of this size when it comes to making tricky — but very necessary — processes more efficient. For example, FinTechs that make corporate debit cards an accessible solution for SMEs enable them to better manage employee spending. Business travel is coming back, and there is enormous potential for positive change. Obviously, there should be a reassessment of whether many of the journeys are actually necessary in the first place. But many companies also need access to the same kind of banking services that their larger competitors do in order to drive efficiency and take the strain away from their employees. How well organisations adapt to the future of business travel will depend on the availability of flexible financial solutions. There is a significant gap in the market for FinTech players to address the needs of small- and mid- sized businesses — not just when it comes to business travel, but expenses in general.