FinTech – the real Future of Banking and Finance
Technology is becoming more and more present in every part of our lives and FinTech is no exception. On the one hand, any technological or financial innovations can be called by that. On the other, more specific approach, it is quite new economic sector, which tries to combine two big market fields – finances and technology. FinTech is used usually in businesses which are providing financial services by the Internet.
It is not an easy job to define exactly what FinTech is. One of the problems is that it is hard to tell when it really came out. It is said that in early 1980s first press information showed up about input technology to the finance sector. Some people say that first signs of FinTech could be the ATMs which were developed in 1960s. Bigger development took place on 1990s when Internet became more common and was growing very fast. But the biggest revolution in FinTech solutions will possibly be reached after 2010, when smartphones become more accessible – they are the most commonly used device in that kind of services.
FinTech is innovation which should brings some good features to our everyday finances. That solution should make our finance actions easier, quicker, more safe and accessible and, last but not the least, cheaper. In 2012 FinTech was divided into three types:
- e-banking (mobile banking and insurance sales),
- online payments (transaction security),
- data analysis (also included consulting services).
After some time we should add there such areas of interests like online loans, all solutions which use blockchain technology and also IoT – Internet of Things, which is a concept of system of objects or devices which can transfer data between themselves.
Benefits of FinTech can be visible and they are more customer-oriented. That technology makes services quicker and more convenient, because we can do everything online and have results usually at the same moment. FinTech also gives companies an opportunity to give up on developing specific (usually very expensive) infrastructure and focus on technology solution. Such an approach gives cheaper product. Because it is all based on technology, companies can collect data about users and develop their solution in a way which is most suitable for their customers.
On the other hand, as all new things FinTech brings some risk. E-banking can be not understand enough and lack of knowledge can cause reckless decisions which could be explained in traditional face-to-face way. It can be unclear what should be done when something goes wrong and how to fix this situation. Every new technology needs time to convince people and make them trust in it.
We can find great examples on well developed FinTech solutions in many different types of finance services. In online payment there are Blik, PayU or PayPal. Online banking uses that technology around the world – the examples can be Erica (mobile assistant of Bank of America) and iPKO. This is also a great solution for communication business (Uber). FinTech can also be applied in selling platforms like E-bay or Allegro. It can be also a great idea for application which uses HCE technology (Apple pay or Android pay).
FinTech can make our finances management easier, quicker and cheaper. It is quite new solution and it is still developing. Who knows, maybe one day it will completely replace standard, offline banking and payments. FinTech is another proof that future is here.