Epapermagazine: A Deep Insight Into Fintech!

Financial Technology has been encompassed in a portmanteau that is popularly known as ‘FinTech’ which represents the emerging financial services sector in the 21^st century. The term finds its origin from the back-end technology that was used for established consumer trades and financial institutions. 

However, now this term is also used to describe technological innovations in the financial sector, innovations in financial literacy and education, retail banking, investment, and crypto-currencies like the bitcoin.

The disruption of new age fintech companies has led to the rapid evolution of the financial services industry in Southeast Asia. Factors such as the rapidly expanding economies, increasing mobile and internet penetration, young urban digitally-savvy population, and largely underserved small and medium enterprises, and consumer markets by traditional institutions have led to the development and growth of what are considered as some of the top Asian Fintech companies.

A deeper understanding of fintech-

• Fintech can be a term that is applicable to any innovation in transaction processing systems, which not only revolutionalize client-company relationships but also fuel human-machine interaction. Some examples include digital money (credit card and debit card transactions), online transaction processing systems, and double-entry bookkeeping.
• The internet revolution and mobile internet revolution have led to the development of a broad variety of technological interventions that provide a deeper insight to personal and commercial finance. It has been established from EY’s Fintech Adoption Index that one-third of customers are increasingly aware of fintech in their lives and they utilize at least more than two fintech services.
• India is currently powering forward through the fintech demographic by possessing one of the most active fintech markets in the world. The country has been able to draw maximum investment in this sector, and it is home to some of the Best Asian Fintech companies. It is slowly gravitating towards the Utopian cashless economy, with the GOI’s innovative initiatives of financial inclusion and Digital India.  

Is FinTech disruptive?

• The online shopping industry, where there has been an immense growth leading to a rapidly reducing need for showrooms and shops, has created a dominance of online cashless transactions.
• A sudden shift in the dynamics of power from banks and other financial services to those who are customer-centric. Banks utilize Fintech to eliminate in-person services and provide services such as online banking, SMS banking, balance checking through missed calls and SMS, and banking apps to ensure a confident consumer base.
• There are companies and trading platforms that use predictive analysis and machine learning to aggregate the collected data from consumers and uncover hidden patterns and trends to enhance the consumer experience.
• The customer demands for insurance have changed. They include specific locations, usage areas, and time frames. This has led to variations in insurance policies and this is where fintech comes in. There is a need to collect more data about clients and fintech is used for these purposes.
• The transaction process improvement equipment, as well as middleware, remains expensive. This has made traditional financial service providers consider partnerships with companies that lend fintech that don’t require a complete overhaul of the financial infrastructure.