Making Finance Accessible to all MMEs:
How Lenders Can Step Up – Podcast
11 April 2020
With the Advent of Covid-19, SMEs and MMEs have found it increasingly difficult to maintain cash flow and get access to funds and support, either through institutions such as banks and lenders or government schemes. The fast changing landscape that Covid has created for many businesses, has made it all the more important to be adaptable to change.
Even before Covid, here at ELEMENTARYb we acknowledged the uncertainties and challenges facing MME’s and the explosion of data and choice that presents both real risk and tremendous opportunity. In this light Fintech has a vital role to play in the financial health of British business, and our own CEO, Karen Rudich was invited to share her thoughts.
Karen contributed to the UK FinTech Week organised by Innovate Finance together with the Department of international trade and the City of London.
At UK FinTech Week, Karen shared the digital stage with key stakeholder currently working hard to support MMEs through the crisis: Christoph Rieche, Co-Founder & CEO, iWoca; John Davies, Chairman, Kompli-Global; Justin Fitzpatrick, CEO & Co-founder, DueDil; and Yasamin Karimi, Head of Product, Codat. The discussion was moderated by the excellent Eleni Digalaki, Managing Analyst, Business Insider Intelligence.
The panel first discussed what specific steps their companies have taken to support MMEs during this time. Karen highlighted that there were a lot of challenges around the big banks getting the loans out and how this constitutes the new norm on crisis funding. But her focus is on the lessons learnt and how liquidity can be enhanced when the next thing happens. She highlighted the fact ELEMENTARYb is looking to give access to financial products so as to support MMEs stabilise and grow their organisations. In her own words:
“Leveraging the connected world
to use up to date credit report and offer MMEs precise information
on what they qualify for and what they do not.”
The panel was then asked how they think FinTech can make sure that MMEs have better access to funding in the future. Karen put forward that it all comes down to the data. Lending being a complex process, data is the way to turn around application process. From the observation that the world isn’t digitised and standardised yet, and with open banking and accounting still in their infancy, Karen derives that it is up to innovation in financial services to facilitate connectivity and data.
“MMEs want to modernise how they handle their financial wellbeing
and optimise business and financial opportunities.
This requires them to have a clear view in real time of their data
so they can navigate the future. It is up to incumbents and FinTechs to make this happen.”
Panellists were then asked how they thought the pandemic was going to change the SME lending space longer term. Keren replied:
“We are going through horrific situation right now
and a lot of companies may not survive. But on a positive note, culture is very resilient
and innovation happens. People take stock and turn things around.
We are going to see a lot of changes.”
Karen went on to highlight how a lot of companies all across the country are going through a generational management shift with baby boomers handing over to two generations down. Millennials are a lot more digitally savvy and willing to connect. According to Karen, this data driven changes are for the better and require that MMEs are provided real-time information. Looking into the future, she predicts that MMEs’ relationships with big banks is going to change.
And of course, Eb hopes to lead the way in effecting this positive change, setting out to support the commercial needs of MMEs to help them become more robust and resilient.