FinTech (financial technology) is a catch-all term referring to software, mobile applications, and other technologies created to improve and automate …
What is Fintech?
Fintech or financial technology is an umbrella term for technology used to streamline, augment, disrupt, or digitize traditional financial services. To be precise, it refers to algorithms, software, and applications for both mobile and desktop.
Sometimes, this term also includes hardware such as internet-connected piggy banks. Fintech platforms help in a run-of-the-mill tasks such as transferring money between accounts, depositing checks, applying for financial aid, or paying bills. Furthermore, they also help with technically intricate concepts, such as cryptocurrency and peer-to-peer lending.
How Does FinTech Work?
FinTech facilitates financial transactions for businesses and consumers, making them more affordable and accessible. It can also apply to services and companies utilizing big data, AI, and crypto blockchain technology to help in highly secure transactions.
Fintech encourages streamlining the entire transaction process by cutting down the unnecessary steps in the process. For instance, different online mobile services allow you to transfer money to people at any time of the day to any account you desire. With a check, the receiver has to go to the bank and follow some steps to deposit the money in their bank. Cash payments have their disadvantages. It will take their time and effort.
Who Uses Fintech?
The users of Fintech are divided into two categories.
Business to Consumer
Many online apps allow users to transfer funds on the internet. Since business offers users the opportunity, this process will fall in this category.
Business to Business
Businesses use fintech services to obtain loans, financing, and additional financial assistance through user-friendly online sites or apps. These platforms also help the company to manage its financial data so that it can check it when needed.
Fintech is an emerging technology that makes transactions safe and quick for businesses and consumers. The technology aids a sizable population because it is simple to comprehend and use.