How will Blockchain Impact Small Businesses?

How will Blockchain Impact Small Businesses?

Capital Markets CIO Outlook | Friday, December 14, 2018

For small-scale businesses, there has always been distress with few challenges. Source capital and finding competent staff within the budget are the two most common challenges faced by every small-scale business. Visibility has become a headache to the small companies in bringing their products to the notice of their potential customers. Small businesses have a minimal budget for media campaigning and cannot invest in gaining the customers’ attention toward their product.

Through social media, many platforms have into play and induced hyper connectivity among people. Unlike television, users can access news and information virtually at any time and location of their choice. Everyone can follow the interesting events in real-time. Companies would be more visible to a large crowd which is virtually impossible to be reached through traditional means. At present, SME’s have almost equal access to their target market as the big names in the industry. The only difference is in how these companies work to grab the attention of social media users.

The blockchain technology has had its beginnings in cryptocurrency that enables to send and receive the payments. The question is about the accuracy of this technology’s benefits to small businesses. This technology enables the transfer of funds instantly in a secured way with ultra-low transaction fees. This is because the third-party interventions are not observed in blockchain transactions. This is very useful to the businesses that are involved in the global marketplace.

Small businesses solely work on scaling; of course, they should, but this focus will neglect and strain the necessary procedures of the invoicing and inventory that were established. For this, smart contracts are the best suitable option that can help small businesses at a minimal expense and yet, help them survive in the business race. Smart contracts also help those businesses which require consistent cash flow and ensure that the payment is made on time. A late payment can be a difference between success and failure. Smart contracts are associated with the Ethereum project which is a kind of blockchain technology. This is a decentralized platform that is executed as precisely programmed without any downtime, censorship, and fraud or third-party interventions.

Synaps is a company which is using blockchain technology for issuing the microloans. Slock, a company which offers an Ethereum-enabled IoT platform, is utilizing this application that facilitates the customers to rent anything by unlocking a smart lock. Furthermore, the global banks are also utilizing the smart contracts for improving the syndicated loan market.

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