Food and Fintech

Fintech is rapidly expanding its reach and involvement in almost all sectors of our lives. Online banking, easy credit, crowdfunding, global remittances, and so much more are now possible because of the versatility and vast applicability of fintech.

The global food industry is one of the most successful industries due to its essential standing in our natural system. It has massive control and influence over major global markets, relationships, and decisions. With the uprise of the fintech industry, there has been a congruous integration of financial technology with the food industry, resulting in an influx of novelty and innovative ideas resounding the vast scope of technologies. 

Although the food industry can be bifurcated into two parts, the agricultural sector, and the retail food segment, it primarily comprises the latter. In this article, we will focus on the growth and development of fintech in the food and beverage industry.

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The Food and Beverage Industry

The global developments in the food and beverage industry have been enormous, due to some reasons. The industry is expected to grow by more than $6,500 billion by the end of 2022, with a CAGR of 9.7%, and almost by $9,000 billion by the end of 2026. 

The two main reasons behind the expansive growth of the food and beverage industry are the global population explosion and the increasing adoption rate of technology. With the people’s participation steadily multiplying globally, it leaves little room for the non-development of this mainstream business sector. 

The integration of finance and technology has influenced the core functions of several major segments, and the food industry is no different. Numerous platforms and services are being offered by several companies that supplement an efficient and innovative food industry. From small businesses to behemoth chains, the application of fintech has been quite versatile. 

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Fintech in the Food Industry

The number of opportunities for fintech in the food industry is countless due to the scope of the technological developments that can help streamline and boost this industry further. The following platforms and services have been the most popular:

1. P2P Lending

Peer-to-peer lending has been one of the most helpful applications of fintech in the global environment. When it comes to the food industry, uncountable small businesses are relying on P2P lending platforms that help set up and sustain their businesses, proving this to be one of the most relevant uses of fintech in the food industry.

2. Sorting Food Wastage

Food wastage is directly associated with financial losses. Every produce or product that goes to waste suggests financial loss, which is detrimental to an organization’s financial health in the long term. Several companies like Agromovil in Colombo have created platforms that link small-level farmers to combat the problem of food wastage, bringing a big win for fintech.

3. Investments

The competition levels in the food industry are skyrocketing, resulting in small and large businesses needing to invest in machinery and technology that helps them automate some steps of the processes. 

To facilitate small businesses in purchasing high-priced technology, many companies like Siemens are offering financial solutions like rentals, leases, usage-based programs, and more to ensure empowerment by lowering operational costs and increasing operational efficiency.

4. Point of Sale Services

With the rise in the number of online and virtual payments in the food industry, multiple payment methods have surfaced globally, inviting customers to make payments by choosing from whichever payment method suits their needs. 

5. Others

There are several other applications of fintech in the food industry, like gamification, where food applications enable users to earn points, which they can then redeem in the form of discounts. 

Apart from these, there are countless other ways in which fintech has proven to be a true winner in the food industry, in terms of versatility, usability, and novelty. 

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Other Applications of Fintech in F&B

Because of the tremendous potential of fintech innovations in the food industry, the number of patent applications related to fintech in the food and beverage industry has increased. PepsiCo Inc has the highest number of patent applications, followed by Uni-President China Holdings Ltd.  

The largest market for the F&B industry is the Asia Pacific region, followed by Western Europe and North America.  

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To Conclude

 The food industry is robustly expanding because of the growing number of participants. As more cultures interact with each other along with the increasing use of the internet, the more scope there is for the food industry to evolve and change, giving way to more fintech opportunities. As both industries evolve individually and together, the expanse of technology increases, ensuring a very competitive environment in the future. 

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