3 Min read
June 28, 2022

How FinTech is Empowering the Creator Economy

As technology rapidly expands across global boundaries, one can find an interesting new phenomenon taking shape across the world, i.e., the emergence of a parallel online economy. This phenomenon is powered by the increasing access of the people to the internet, which has created the largest global consumer base in the history of the world. Simultaneously, it has also created an ideal opportunity for creators from various spheres to seek out a livelihood in this emerging online economy. The scope of the endless possibilities that the online world opens up can be gauged from the very fact that with a total market of 50 million content creators, the creator economy is anticipated to be pegged at north of $100 Billion.

Empowering the Indian Creator Economy

The introduction of affordable mobiles plays a major role in empowering the content creators irrespective of their economic status. So, the phenomenon is more significant in emerging markets like India, where Youtube’s creator ecosystem alone contributed over Rs. 6,800 Crores to the Indian economy and has supported 6.83 lakh full-time jobs. This is only a part of the rapidly expanding 15 million Indian workforces that thrives on a freelance gig economy that is expected to reach $445 Billion by 2024. Thus, this is indeed an economy that cannot be taken lightly, and Fin-Tech developers have quickly come out with innovative solutions for content creators to be able to manage their finances efficiently.

Addressing the Challenges

To understand the challenges to the development of the creator economy, it is important to understand that creators often have non-traditional sources of income, which are essentially performance-based. So, these bring us to a few issues of the creator economy, such as - 

  • Lack of Stable Income - Since the income of the content creator is task-based, it lacks a stable source as it can vary on the demand of the market. Thus, there is an absence of a predictable, stabilised source of income for the content creator. 
  • Absence of Income Records - Content creators often have varied sources of income such as advertisements, viewership monetisation, freelance gigs, etc. This often means that they have no payslips for the payment that they get, leading to unveriable incomes. 
  • Lack of Employment History - Content Creators often work on a freelance basis and take up multiple assignments at a given time. This means that their employment history is not trackable or verified.

Traditional institutions of finance and banking scorn at the absence of all these factors since it is viewed as a sign of unreliability and instability. Thus, these factors place the content creators in a disadvantaged position if they want to avail any form of finance from these institutions. Although the finance sector in India has undergone revolutionary change with the emergence of technology, it has still failed to include content creators as potential customers. So, it is the FinTech developers who have taken the prerogative to identify this problem area and have taken innovative steps to remedy the situation and place the content creators at an equal footing with the workers of the traditional sectors.

Analysing the Problem

While a content creator may earn enough to support a livelihood like any person engaged in the traditional sectors, he cannot avail of the added benefits that the latter can. Let us refer to a real-life example to understand the serious consequences of such deprivation. 

Arjun is a successful content creator from Delhi, India. Although the sole earning member of his family, he is able to sustain his dependents with the money he earns from his food vlogs on Youtube. He is happy with his life and loves his job. One day his sister’s marriage was fixed, and although he knew he didn't have the required funds, he was confident that after working so hard for so long, he could avail a loan that he would be able to pay back comfortably over the next few years. However, when he approached the banks, he was surprised to see that his request for a loan was consistently denied due to the lack of a stable, recurring income. Eventually, he had to face a lot of hassles to obtain the money required to get his sister married. While he was able to arrange the required funds, the entire episode left him distressed and in two minds about continuing his job as a content creator.

This is a story that would be relatable to most of the content creators, who, despite earning a respectable livelihood, fail to garner the trust of traditional banking institutions.

FinTech as a Solution

The increasing number of similar issues has led the FinTech developers to innovate new methods of risk profiling and underwriting which are more considerate towards such content creators. There has also been a simultaneous development of the solutions which allow content creators and freelancers to have increased control over their financial resources. 

FinTech platforms like Tartan provide users with holistic user control over their payroll data using features like standardized income and employment data, payslip record verification and easy sharing of the payroll data with user consent. It enables automated data management to give the creator a complete and updated view of his financials and empowers him to make informed financial decisions. Such platforms also provide the complete financial records of the content creator, including all his income and employment history, which would help him score better in risk profiling and underwriting processes carried out by financial institutions. Additionally, data points of "reputation" are provided which includes the success rate of the creator's work, total projects taken up and completed rate etc. Thus, it would eventually help the content creators stand on an equal footing with their counterparts engaged in the traditional sectors.

What’s Next in FinTech for Creators?

With the advent of development in the FinTech sector, creators can finally expect to develop a verified economic base which garners more acceptance among all the traditional institutions of finance. Such mainstream acceptance will go a long way in empowering the creators with the much-required financial safety net and shall place them at par with the rest of the working population.

As an increasing number of people shift to the gig economy with the gradual change in the work dynamics, the FinTech platforms that succeed in addressing the core needs of the content creators and seamlessly integrating them with the existing economic structure would inevitably see sustained growth and success in the long term. 

With the first of its kind product offering in India and a feature packed platform, TartanHQ’s demo session is worth giving a try where you can view payroll data points for four categories - Income, Employment, Identity and Reputation.

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