What is fintech?
Financial technology, also popularly known as fintech, is essentially the intersection of financial services and technology. In simple terms, it refers to the technological innovations in the financial sector. This industry Is focused on developing new technologies that will disrupt traditional banking and financial markets. Fintech innovations are soon expected to revolutionize the entire banking and financial scenario by making transactions easier, faster, and more convenient.
Today, with significant demographic shifts in the population, people are seeking easy access, convenience, efficiency, and speed. They prefer transacting via mobile platforms or applications for activities such as tracking their overall spending, applying for a loan, or even optimizing their investment strategies. Fintech innovations provide both individuals and businesses with scalable tools. This means that traditional banking companies (including banks, insurers, and wealth and asset management companies), the risk of disruption is real.
Fintech innovations 2018
Apart from providing convenient and faster options for undertaking financial transactions, here are some of the key use cases of fintech innovations that we can expect in the coming years:
Plastic debit and credit cards seem to be slowly losing their charm among customers because now they can do it all with just a click of a button. Digital wallets are one of the prominent fintech innovations that have been gaining momentum in the past couple of years. Not just the credit and debit cards, but digital wallets can also store other important documents such as health cards, driver’s license, loyalty cards, and several other ID documents.
Cryptocurrency and blockchain
Financial transactions in the form of cryptocurrency with the help of blockchain technology are one of the most revolutionary fintech innovations. This technology has garnered immense popularity and is now considered to be one of the easiest and safest methods of transacting. This is mainly because blockchain eliminates the reconciliation of third party concept and provides additional security to the transactions.
Fintech companies are popular for providing quick and prompt services to their customers. Unlike traditional banking facilities, fintech companies use chatbots that work on artificial intelligence to cater to customers’ queries and provide prompt responses to their queries and issues. Traditional banking companies are now considering incorporating fintech innovations such as chatbots and the use of artificial intelligence into their operations.
Though cloud computing and IoT have proven to be advantageous to the business owners as well as the customers, the transfer and linking of a massive amount of data is a complicated process. Fintech innovations like edge computing solve this problem as it processes the data near the source. Thus, the bandwidth required is reduced considerably. Furthermore, this will increase the security and privacy of the data.
Although edge computing is going to be one of the revolutionary fintech innovations, this is not going to reduce the popularity of cloud computing. With a large number of companies offering cloud-based services, there is an increased potential for integrating clouds, which, in turn, will reduce the need for companies to have an in-house tech department. Also, integrating multiple cloud providers will also help in providing some complex services such as content management, data analytics, and storage.
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