• Tachat Igityan, CFO and Founder at destream


• 14.11.2024 02:45 pm
#FintechChallenges #PaymentHurdles

Contrary to stereotypes, the creators' earnings are not only contracts with brands and advertising. For many, this income comes in payments of occasional sales of informational products for a small price or tips. For example, almost 50% of creators earn money from streaming. 

According to Alibaba, top streamers' weekly earnings can reach $30,000. At the same time, their income will consist of micropayments of up to $10. Unfortunately, such a financial structure is completely non-standard, and traditional financial institutions often refuse to serve creators because of that. 

Creators Are Not Small Businesses or E-Commerce

The creator business is completely different from the traditional ones we are used to. As I have mentioned before, creators earn through small and unpredictable payments. Unlike e-commerce or small businesses with product-based revenue, creators’ earnings are based on a mix of tips and collaborative sponsorships that do not align with traditional sales models. 

Traditional financial products, like business loans or credit lines, are built for companies with steady revenue and recorded sales. But creators don’t fit that frame. Their income makes it difficult to access these financial tools, which in turn limits their potential to invest, expand, or take creative risks.

Beyond the problems with inconsistency of payment flows, it’s worth noting that creators' income is largely platform-dependent. This means they are at the mercy of platform policies—facing transaction fees, restricted payout schedules, and minimum thresholds for withdrawals. 

Why Is Creator PayTech Overlooked?

One explanation is the complexity and niche nature of the creator's financial profile. The reasons for that are the same — unstable returns and very special needs. Also, startups and financial institutions often chase high-growth, high-impact areas, and right now, the demand for specialized financial products for creators doesn't stand out as much as other booming market segments. This has led to a bit of a blind spot where creators haven't received the attention they deserve. 

In the tech world, the spotlight has mostly been on front-end tools that help creators make and share content—platforms that are easy to grasp and widely appealing. These tools have quickly gained traction thanks to their clear benefits. Meanwhile, back-end solutions for financial stability and payments—vital for creators' long-term success—have lagged behind since they are not the first thing that comes to mind. 

How Fintech Can Innovate for Creators

1. Flexible payments. Creators need payment systems that align with their irregular income flow. Think of solutions that offer on-demand or accelerated payouts, so creators don’t have to wait for the typical monthly cycle. Faster access to their earnings means better cash flow, which can support everyday expenses and fund new projects without the long wait.

2. Creating solutions for a global audience. Creators often have global audiences, which means handling payments across borders is crucial. Affordable options for international transactions—such as multicurrency accounts and localized payment methods—can prevent creators from losing income to high conversion fees or facing delays. 

3. Solving the problem of diverse income streams. Creators earn in varied and complex ways, and each type of income brings challenges. Fintech solutions must tackle real-world creator issues directly. For instance, those who earn from merchandise and streaming donations need systems that track and consolidate their income.

The Path Forward

To support the creator economy effectively, fintechs have to admit that it is a different sector with unique challenges and needs. There are a lot of creators, and there are also a lot of payments that provide for the creator's economy. So, developing specialized tools and solutions for creators will make them thrive as an industry and rapidly become a significant part of the global economy.