How is Fintech Fulfilling Social Responsibility Amid Covid-19?

The lockdown due to COVID-19 has induced a spike in the popularity of fintech applications. People are opting for net banking and mobile banking services. Fintechs are playing a vital role in diminishing the economic and social repercussions of the current COVID-19 catastrophe.  Expanding the financial horizons of low income families and small businesses can also help in a comprehensive recovery. Fintechs are more agile, competent and economical than the conventional financial services. These are the reasons behind their increasing reach among financially weaker groups and small and medium sized enterprises (SMEs). When the country was hit by the COVID-19 health disaster, fintechs enabled cashless and contactless transactions. They also helped to expedite the swift and efficient implementation of support measures taken by the government.

 Many fintech companies have set apart their commercial objectives and for now they are concentrating on the welfare of their staff and consumers. They have constructively impacted the retail market by helping in digitally sending and accepting the money and this is the effect which is going to remain even after the pandemic is over. Fintechs are making some exceptional efforts to help the needy communities to overcome the hardships through charities and by complying with their most crucial commitments during these dire circumstances.

Providing Financial Aid in the Form of Long and Short Term Loans

During the pandemic, people have gone through the toughest periods of their lives. Many have lost their family and friends.They have spent their life savings to save their loved ones. During these testing times, fintechs emerged as saviours for many as they provided short term and long term loans in the times of need with minimum paperwork and in a short span of time. By taking personal loans and medical loans, they were able to pay for the expenses of hospitalisation and post discharge treatments.

With the dried up sources of income and ever rising expenses during COVID era, these loans have helped many to handle the educational, household and other expenses. Laptops and smartphones have become the basic necessity to study and work from home. These loans helped them to buy these products and cope up with the new challenges.

Respite for SMEs

Amid COVID-19 pandemic, small businesses are worst hit in the Indian economy. It is expected that over 80% of the small and medium sized enterprises are negatively impacted by the pandemic induced recession. It is anticipated that it will take more than a year after COVID to bring normalcy to these SMEs. For the revival, they will need to adopt the technology, better credit facility and better marketing support.

Fintechs companies have totally digital platforms. So, they are in a better position to help them in comparison to the conventional financial institutions. Fintechs are coming up with some tailor made solutions to help these small businesses. They are helping them to access their bank accounts, debit, credit and business cards, managing their cash flows, etc.

They have simplified their loan application processes, smooth repayment options, enabled the businessmen to accept payments digitally. These are the most crucial factors to sustain their businesses especially when lockdowns and social distancing have become the new normal. The contribution of fintechs in reviving SMEs is phenomenal.

Flexibility, Convenience and Modernisation

Our economy was hit so badly amid COVID-19 pandemic that businesses and the industrial sector had disrupted and fintechs could not expect the timely repayment of their loans. To come up with new plans and strategies was the need of the hour. fintech s responded positively to this challenge. They knew that the ‘one solution for all’ policy would not work during this crisis because unlocking was done in phases. Some activities were allowed in the phase-1 and some were allowed in the last phase of unlocking. So, the same policy could not be implemented for both.

So, companies came out with some tailor-made strategies. New credit plans were made to suit their needs, EMIs were lowered for the worst hit section and tenures for their loans were increased. This was a great respite for the industry at the time when they needed it the most.

Cyber Security

The financial and business pandemonium after the pandemic has increased the threat of cyber criminals more than ever before. Cyber criminals are leaving no stone unturned to dupe the individuals and rob them off their finances and resources. These unprecedented developments in the financial panorama urged the fintechs to come up with some flawless solutions.

 Being dedicated to providing the utmost financial and cyber security to its customers, companies amplified their KYC services to nullify such attacks. Safeguarding user data organisational assets from maligned individuals and cyber criminals.

 So, the fintechs are doing their best to provide social relief amid Covid-19 pandemic. Traditional banks are also collaborating with fintechs which are flexible and digitally more capable to satisfy the customers’ needs efficiently and swiftly. Fintechs are redefining the rules of the conventional financial systems so that an inspiring environment for growth can be created.

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