What is FinTech?
Fintech, a blend of the words “financial” and “technology,” refers to the use of technology to improve and automate financial services. Its scope is vast and continuously evolving, but it can be broadly grouped into three main categories:
Blockchain & Cryptocurrency
Blockchain technology is a decentralized, distributed ledger that records the ownership of digital assets. Beyond cryptocurrencies, blockchain technology is being used in smart contracts, decentralized finance (DeFi), and enhancing transparency and security in financial transactions. Blockchain’s potential extends to supply chain management, digital identity verification, and more.
Banking & Payments
Fintech has revolutionized traditional banking, enabling banks to offer digital services like online banking, mobile apps for financial transactions, and more. This includes neobanks, which are digital-only banks without any physical branches. Mobile payment platforms, peer-to-peer (P2P) payment apps, and cryptocurrency transactions have revolutionized the way payments are processed.
Robo advisors are digital platforms that provide automated, algorithm-driven financial planning services with minimal human supervision. They offer easy and affordable investment management, portfolio rebalancing, and tax optimization. Crowdfunding platforms like Kickstarter allow individuals and businesses to fundraise for projects or ventures.