Fintech is a new field in the financial innovation era. It stands for “Financial Technology” and is about the ultimate connection of finance and technology, which are combined to make our lives easier. Through the development of software technologies, there is a significant opportunity to automate different parts of services in finance & banking. But apart from that, what is fintech?
To begin with, fintech is a global transition that has occurred during the last decade with the advancement of mobile technology and smartphones. It harnesses technology to allow people across the world to develop, advance, and thrive. Therefore, financial technology can be applied in a spectrum of different industries, with a higher impact on banking. Below, you can see some of the most popular fintech fields with their main technologies and applications.
But most of all, it is a world where there is great mobility, huge opportunities, and a future for young people who love the innovations that technology offers and want to create something of their own in this industry. Creation is based less on knowledge and more on the persistence to unorthodoxly solve an essential problem.
Until now, financial services institutions have offered a variety of services under a single umbrella. The scope of these services covered a wide spectrum, from traditional banking to mortgage and transaction services. At its most basic, Fintech decouples these services into individual offerings. Combining enhanced offerings with technology allows fintech companies to be more efficient and reduce the costs associated with each transaction.
Fields of Fintech
FinTech is the technology that bears under its umbrella the following fields applications, digital processes, products, and business models. The main areas of financial technology:
1) Fintech Technologies
- Artificial Intelligence (AI)
- Machine Learning (ML)
- Big Data and Data Analytics
- Robotic Process Automation (RPA)
- Blockchain and Cryptocurrencies
2) Fintech Applications
- P2P lending
- Digital Payments
- Personal Finance
The Future of Financial Technology
This field was initially created to cover back-office support demands. Throughout the years it has been growing at an intense pace and has become an entire industry of customer-centric solutions. The future is considered bright for the field. Thus, investments have exponentially increased over the last decade: In 2012 the total investments in fintech companies reached 4 billion US dollars which exploded to an out-breaking of 212 billion US dollars in 2019, before the appearance of the pandemic.
On the one hand, various elements have added to the headway of FinTech throughout the past 10 years. Mechanical headways have changed how we do almost everything in our everyday lives. A few advancements like the IoT, computerized reasoning (AI), blockchain, and distributed computing, have been significant drivers of FinTech development. Where occupant monetary players have been not able to keep up the pace with moving buyer propensities, FinTechs have stepped in to acquire huge ground.
On the other hand, obstructions to passage have diminished as innovation has thrived, compelling conventional monetary establishments (FI) to change or abandon old regulations. As per Dorothy R. Auth, an accomplice at Cadwalader, Wickersham, and Taft LLP, FinTech is the regular movement of how monetary administrations will develop, and the COVID-19 pandemic has just sped up its turn of events. “Financial Technology will make exchanges quicker and more effective. Blockchain will be a troublesome power and compromises customary banking on the off chance that they don’t coordinate it into their frameworks,” cautions Dr. Auth.
It is all about Increased Innovation
As of now, many banks are joining forces with FinTech firms to upgrade their administration contributions. Right now, companies are understanding that purchasers’ image reliability is diminishing, while interest in speed, precision, straightforwardness, and more innovation is rising. As indicated by the Swiss Finance Institute, during the COVID-19 pandemic the everyday normal pace of FinTech application downloads expanded from 29.2 percent to 32.8 percent.
Finally, adjusting to advertising requests will become essential in the post-COVID-19 computerized age: according to Mr. Gabriel Lakeman, the partner of Latham and Watkins.”We have seen supported quick development in the financial technology sector throughout the course of recent months”. Adding: “On the installments side, COVID-19 continuedly to affect the ascent of installment administrations. On the crypto side, we have seen a critical expansion of the biological system with new mechanical improvements being sent in true use cases.