With the coronavirus pandemic putting strains on businesses, some FinTechs have been offering their services for free to help.
The virus has left a lot of businesses in a state of panic to ensure they can survive through the pandemic. Countries around the world have gone into lockdown and while there have been sizeable rescue packages made by governments to help failing businesses, it might not be enough for everyone. Some FinTechs has stepped up to offer their aid to people impacted by the virus.
One of the companies to release a free service to help struggling businesses was NorthOne, a US-based digital bank. NorthOne co-founder and CEO Eytan Bensoussan told FinTech Global, “It was clear to us that small businesses, especially those that are in the food service and hospitality industry, would be hit the hardest by this pandemic. We wanted to help in any way we could and knew that the last thing that business owners need to worry about right now are bank fees.”
The challenger bank decided it would drop all account fees for all businesses which are in areas heavily impacted by the pandemic. Furthermore, it is providing free accounts to businesses including restaurants, food services and hospitality companies, as they cope with the impact of the virus.
The challenger bank said that “acting early and decisively is part of our ethos” and this led the bank to have its staff work from home three weeks ago, before governments in the US and Canada encouraged it. Bensoussan stated that working from home is a luxury not all small businesses have. Companies in retail or restaurants can’t just work from home, but even financial services are not all prepared. A recent study from Leesman claimed that in the UK 56% of people had never worked from home.
“Now more than ever business owners need a banking app that lets them run their business, no matter where they’re working from, be it an office, a home, or a car.,” Bensoussan said. “We’re proud that we can provide free access to a banking app that allows business owners to stay put and stay focused on their business.”
Digital banks could see their customer bases increase over the course of the pandemic. With governments encouraging people to refrain from using cash or visiting their branches, people may look towards a fully digital banking experience. Bold in Finance recently completed a study which found Revolut could increase from the 10.8 million it had in February to 13 million by June. In 2021, the figure is expected to hit 16 million.
Regulators around the world are trying to stabilise the financial market and ensure there is not a crash. This has led to a number of regulatory changes which firms need to monitor, to ensure they keep compliance or see where they legislations are being relaxed. Earlier in the week, the European Securities and Markets Authority (ESMA) revealed it will ease video communication monitoring requirements under MiFID II during the coronavirus crisis. During this period it understands firms may encounter scenarios where they cannot record certain conversations due to staff all working from home, and is asking them to seek alternative measures to mitigate risks.
There have been a number of other changes around the world to regulations such as banning on short selling, cancelled plans of stress tests and more. Waymark Tech, which compiles regulatory updates into a single location, is helping companies stay up-to-date with all these developments for free.
Waymark Tech CEO Mark Holmes said, “During these unprecedented times, there is still an expectation on financial institutions, upon which many people rely, to continue business as usual. Markets around the world continue to operate and we recognise that financial organisations need to keep ahead of the rapidly changing advice to ensure they remain compliant and provide the best service to their customers during this time. “
Throughout the duration of the pandemic, the RegTech will collate all announcements from regulators and law firms into one location for free, making it easier to access to updates easier and simpler.
“With internal teams now WFH, staying on top of these alerts and sharing key information is increasingly difficult, and so we felt making the regulatory horizon scanning module of our AIaaS platform freely available was the right thing to do to support the industry,” Holmes said.
Businesses are also looking to help individuals during this tough time. Fast food chain Leon announced it is giving a 50% discount to all NHS workers during the pandemic. It is also letting any of its workers to stay at home and will help them get onto the furlough scheme, a temporary system where the government will pay up to 80% of their wages. It said, “This decision isn’t financial. In fact, it is costing out business more to stay open.” But it is doing this to help those tackling the virus. Finally it said, “During this crisis, if we do by some strange accident make a profit all of it will be spent directly on feeding hospital teams.”
Some of the people heavily impacted by the virus are rideshare drivers. They meet a lot of people throughout the day and so it is quite likely they will cross paths with someone who has contracted it. However, they cannot simply stop working during this time or they will have no income, and if they themselves are hit with the virus, it can be tough to cope with no income coming in during the self-isolation period.
London-based InsurTech startup Zego is looking to ease the financial burdens of those workers which do get infected by the virus through 14-days of free cover.
In a statement, Zego said, “Coronavirus is having a huge impact on the UK’s workforce and those who work in the gig economy are particularly vulnerable if they get ill, or are unable to carry out jobs for an extended period of time due to self-isolation. We built Zego to offer flexible insurance and fair pricing, so we want to make sure that none of our customers are being weighed down by fixed insurance costs during this period if they are unable to work.”
The insurance policy which is designed for UK delivery and ridesharing workers will be given for free to those who have been forced to self-isolate due to coronavirus. Its decision came to help ease financial strains on its customers that are unable to earn any money during the period.
With the new offer, Zego customers who have fallen ill or suspect they have Covid-19 to claim up to two weeks of free cover when they renew their policy.
“We are constantly reviewing our policies and will keep trying to build solutions to make our customers’ lives easier,” the company added.
There have been a number of businesses offering their support, whether it’s by dropping fees, lowering loan rates or offering digital identity services to hospitals. Here is a list of seven FinTech companies offering free or helpful services during the coronavirus pandemic.
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