For years, businesses craved a change in the financial sector. Banks were struggling to innovate and it seemed that better, faster, and cheaper financial services for businesses were unachievable.
With financial digitalisation and the emergence of Electronic Money Institutions (EMIs) in the late 00s, that change became a reality.
EMIs can play a crucial role in transforming businesses, offering quicker services that prioritise great customer service and dismantle unnecessary bureaucracy.
Without physical locations to maintain and the associated costs, it’s no surprise that EMIs are continuing to take the financial world by storm.
But what exactly are EMIs? How do they work? And how could they positively impact your business? In this article, we’ll explore all the above to give you a full understanding of these revolutionary institutions.
What are EMIs and how do they work?
EMIs are financial institutions that offer online-only services using electronic money. They can issue and redeem e-money, providing services that range from international payments to multi-currency business accounts. EMIs, such as 3S Money, aren’t banks – they’re bank challengers.
To put it simply, EMIs offer streamlined money management for businesses that matches the global nature of the modern world. Simplicity and ease of use are at the heart of most EMIs, especially 3S Money – a cross-border payments ecosystem for international businesses.
Our online application process only takes 15 minutes and consists of straightforward business-related questions. If you’re eligible, you’ll then receive a welcome call, review, and confirmation. Once approved, you can send and receive funds, as well as exchange 65+ currencies, with your International Business Account.
The past, present and future of EMIs
One of the best ways to grasp the concept of EMIs is to look at where they came from, and the direction they’re heading in.
It’s no secret that in the late 20th and early 21st centuries, business banking was overly bureaucratic, unoriginal, and lacked innovation.
Long wait times, unnecessary paperwork and high fees were all part and parcel of the business banking process at brick-and-mortar banks. Digitalisation changed all that. The catalyst for change arrived in 2009 when the EU Parliament passed Directive 2009/110/EC. New financial institutions that were entirely online, called EMIs, came into being and flourished in the coming years.
But why were they so successful? There are many reasons. But most notably, EMIs offered a less bureaucratic way for businesses to operate financially that reflected the 21st century’s changing culture.
Today, EMIs are continuing to change the business banking landscape by evolving to their customers’ needs.
EMIs, such as 3S Money, help to break down financial borders and offer frictionless international payments – an area where traditional banks struggle. 3S Money itself was founded to facilitate simple and smooth international business operations and enable entrepreneurs to create and manage businesses anywhere in the world.
Our borderless business accounts help ambitious organisations looking to scale their operations globally – regardless of the colour of a founder’s passport. EMIs also make business banking more accessible. Opening a business account is often seen as an arduous task, packed with paperwork and other time-consuming bureaucratic processes.
Rather than taking months, EMIs take just weeks (if not days in many cases) to get things started.
It’s safe to say that the core pillars of EMIs, such as innovation and progress, aren’t falling away anytime soon. In fact, they will only be enhanced by more competition and digitalisation. Unlike traditional business banking and the bureaucracy that comes with it, EMIs are much less rigid and more open to change. The result is banking solutions that help transform the financial opportunities of millions of businesses around the globe.
As EMIs grow, customers and challenger banks aren’t the only winners. Traditional banks, stuck in their ways for decades, are being forced to evolve and incorporate digital processes which is benefiting the entire banking industry.
According to a UK Finance report, debit card usage over cash will continue to grow exponentially over the next decade moving us further towards a cashless society. Add to that innovations in digital transaction technology, such as business blockchain and tokenisation, and EMIs will become ever more crucial.
Are Electronic Money Institutions better than traditional banks?
With blockchain, tokenisation, and a future without cash peering over the horizon, there’s never been a better time to opt for EMIs over traditional banks. But what can they offer that brick-and-mortar banks can’t?
Here are some of the main advantages that EMIs have over traditional banks:
Licence to adapt, change and innovate
Lower fees for international payments
A faster application process for both new and existing businesses
Simple, clear and quick money management for businesses
An understanding of the future digital environment that traditional banks fail to grasp
Of course, every business has different priorities. But looking into the future is always crucial for success. With further digitalisation to come in the finance sector, it’s becoming more and more difficult to see a world in which EMIs don’t play a pivotal role.
How could Electronic Money Institutions help your business?
So, what are some of the innovative benefits that 3S Money can offer your business?
EMIs strip away most of the bureaucracy that holds back traditional banks, allowing for frictionless business money management. 3S Money enables clients to manage international payments in multiple currencies from one online account further simplifying business banking logistics.
Lower fees and more currencies
Unlike traditional banks, 3S Money provides borderless payments and allows businesses to send and receive money in over 65 currencies (that’s more than other EMIs such as Wise and Revolut – not that we’re counting.) Plus, our clients benefit from our highly competitive live FX conversions.
Personal Client Managers
While we might be a digital institution, 3S Money allocates living, breathing personal Client Managers to businesses. These dedicated contacts can offer tailored support in under 20 minutes. When you need a hand, it’s always better to talk to a human being instead of a bot.
If you’re at the beginning of your entrepreneurial journey, EMIs are considered by many to be the best business bank account for startups. This is mainly thanks to their frictionless and speedy processes which don’t compromise security. Unlike traditional banks, you don’t have to wait months to set up an alternative bank account, so you can get started much quicker.
Our alternative bank account provides your business with flexible IBANs (International Bank Account Numbers) and the ability to transact in 190+ countries – no matter where in the world you’re based. This means you can easily manage your business payments in over 65 different currencies from one online account (without paying extortionate fees).
EMIs are a foundational part of the alternative finance world, and that isn’t going to change any time soon. If you’re interested in discovering more about 3S Money’s services and digital business finance in general, be sure to read our latest guides and articles.
Do you have a question about how 3S Money can help your business? Please don’t hesitate to get in touch with one of our team.