FinTech is no longer a jargon of the banking industry. Instead, it has become a familiar term in technology in general. The Global investments in FinTech ventures has doubled to a whopping $112 billion as compared to $51 billion last year. This is more than an evidence to prove that the digital revolution is at the doorsteps of financial services sector.
This revolution is having a huge impact on all the banks and financial institutions globally. But what actually FinTech is? Let’s see.
This revolution is having a huge impact on all the banks and financial institutions globally. But what actually FinTech is? Let’s see.
FinTech was introduced as a technology that was used at the back-end systems of financial institutions and banks. However, since then its definition has changed significantly. Now it encompasses several applications that are consumer based. By 2019, you can trade stocks, manage funds, and pay for your insurance and food via this technology.
The FinTech for banking has impacted numerous applications and revolutionized the way consumers access their finances. Its impact ranges from mobile payment apps like Square to investment and insurance companies. This profound impact of FinTech can also be seen as a potential threat to the brick-and-mortar or traditional banks.
In today’s digital era, customers are not keen to go for services provided by the traditional financial services industry. Instead, they prefer services that are quick and safe. This is the reason why FinTech and FinTech is gaining popularity and causing disruption in the banking and other financial services.
Now, let’s see FinTech’s impact through some stats. According to a study that took place in 2016, a vast majority of Americans (84 percent) use FinTech for managing their finances. Moreover, the majority of them use between one to three apps in order to manage their finances. In addition, around 69 percent use these apps at least a few times a week and around one-third use it on a daily basis.
Currently there are approx. 1.7 billion people worldwide without any bank accounts. FinTech comes as a savior for all those people by providing an easy option to participate and access the financial services without any need of a bank account. FinTech is the best option to carry out financial inclusion since it’s developed to provide consumers a direct access to their finances through simple yet cutting-edge technology.
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