FinTech or financial technology has become very popular in recent times. It is nothing but the application of technology in the world of finance and banks. Anything from payments made on mobile to OTP-based confirmation is an example of FinTech. Anything that helps make the world of finance easier and better is probably because of FinTech. This might sound like a sweeping statement but in all honesty, this is true. FinTech has helped bridge the gap between the banking industry and its customers.
Now, there are a lot of innovative startups and FinTech companies that have come up. These companies focus on creating new FinTech products that help disrupt the existing marketing but at the same time provide assistance to the general customer base. These services are geared towards personalized services, better interest rates, and lower processing fees so that everyone can benefit from it. FinTech has been nothing but a boon for everyone and every single person has been benefiting from this.
In order to make this approachable and easier for you to understand, here is a list of five things that you should definitely know about FinTech. So, without much ado, here’s what you need to know.
#1: Why We Are Talking About FinTech
To put it simply, FinTech makes things easy. Think of it as a piece of tech just like mobiles or internet. It makes your life easier. Can you make bank payments by sitting in the comfort of your home? That’s nothing but FinTech at work. It is a combination of convenience and simplicity. It is just like the dotcom boom of the 90s. But this time, it is much more reliable and concrete. This decade has seen its fair share of financial crises. This led banks to impose stronger regulations.
As a result, the common people suffered. But, not for long. FinTech startups realized that these banks had created a void that needed to be filled. Hence, a lot of financial services came up that helped people out and gained popularity as a result.
#2: So, No More Banks?
FinTech has triumphed. But that does not mean that banks have become obsolete all of a sudden. The bigger names in the banking industry are still thriving and will keep doing so because they have a higher brand value.
Even though FinTech is disruptive, big banks are still the bigger players in this field. They have the budget to invest in tech and that is exactly what they are doing. This is happening because they are aware of what FinTech can do. And, this itself means a lot to FinTech companies. In fact, a lot of banks are collaborating with these companies so that they can serve their customers better.
#3: Social Happiness
FinTech is helping a lot of communities that did not have access to proper banking. In this day and age, banking is not a luxury. It is a necessity. Financial exclusion is a pressing issue in a lot of underdeveloped and developing countries. For people living in rural areas and those who are not really connected to any formal banking network, these people can benefit greatly. People can safely send and receive money using their mobile phones. In fact, a lot of services do not even require smartphones. All they need is a mobile phone capable of receiving SMS-es.
#4: Social Media And Money
Social media platforms are the recent adopters of this tech. From WeChat to Facebook, a lot of these platforms are allowing people to send money to their friends, colleagues, and relatives. For small-time business owners, this means a lot. They can set up shops on social media and receive payments from their customers without any hassle. Obviously, payment wallets like Paypal and Paytm are pretty popular. But, paying via social media is removing that middle-man and both parties are happy with the arrangement.
5: Cryptocurrency and Blockchain
Financial technology has gone to such an extent that it has created its own currency. Bitcoins, Ethereum, etc. are common cryptocurrencies that we keep hearing about nowadays. But, all of this works on one type of tech called blockchain. Blockchains are nothing but digital ledgers that provide a transparent method of financial transaction. All the blocks are secured and it has the potential to completely eradicate the banking system if it catches on.
Why You Should Pay Attention
This is the age of technology. Moreover, every single person should have access to banking services. With new digital currencies, things do look brighter. But people have to understand the value it provides them. Banks have already realized that competing with them will not help them, so they have teamed up to provide better service to everyone. So, maybe in the near future FinTech will become a way of life. Now, it’s just a game of wait and watch.