The financial industry has been through a significant shift in the last decade. Advances in technology have brought major changes in the way transactions take place. Transferring money has not only become easier but much safer, thanks to financial technology, more commonly known as Fintech. It has changed how people save, borrow, and invest money.
Financial technology is all around us and though it is new, the rate of growth has been phenomenal. The global investments in this technology have crossed the $100 billion mark in 2020 and are set to double in the next 5 years.
Fintech app development has enabled several businesses, especially start-ups to provide better services in the market. From apps like PayPal to online investment platforms like Cryptocurrency, they all involve fintech solutions in one way or another.
Let’s get a deeper understanding of what Fintech is with examples.
What is Fintech?
The use of modern technology to upgrade the delivery of services and products in insurance, banking, and fields related to finance is called fintech. The tools empowered by fintech are changing the methods of tracking, managing, and facilitating finances. Fintech describes companies that assist financial services using automation.
Uses With Examples:
Fintech app development has become important in every step of our lives be it as simple as buying coffee to complex functions such as handling finances. It all started from the introduction of credit cards in 1950 to ATMs and has led to personal finance apps as well as intra-day trading. The smartphone has brought several aspects of finance to our fingertips with the help of fintech. The uses and fintech examples are as follows:
The practice of resourcing a project with the money contributed by several individuals is known as crowdfunding. This process in recent times takes place via the internet as it’s simpler and increases the reach.
Some key features that a crowdfunding fintech has are an easy-to-use interface, the ability to keep transactional records, observe investment charts, project details, and compatibility with multiple payment gateways which eases transactions. It also assists start-ups to directly reach investors rather than going for bank loans.
Patreon: A platform that is mostly used by YouTubers and artists to generate funds for their projects. It also supports gamers to raise money. It is located in the USA and serves worldwide assisting creators to earn for their efforts.
GoFundMe: A USA-based platform that helps in garnering funds for various causes around the world. It is focused on helping community-based projects and has around 50 million donors who contribute to enable a change in society.
Kickstarter: The platform was launched in 2009 and has funded more than two lakh start-ups to date. It is based in New York and has an average success rate of 40%. Millions of visitors visit this website daily.
This has become one of the basic needs of our day-to-day lives. The transactions via mobile are expected to reach $5 trillion by 2023. Everyone today uses some form of mobile payment app on their smartphones. It is leading the world towards a cardless economy that is much safer than today.
The advancements in digital authentication and mobile technologies have made the process simpler. It has also provided companies the advantage of saving revenue that was spent on exchange rates enabling them to provide better experiences. Integration with blockchain and cryptocurrency is an added asset for the users.
PayPal: A USA-based platform that enables fast and easy transactions across the world. It is acceptable by millions of outlets and eCommerce platforms.
Venmo: It is a widely used mobile app that handled around $13 billion worth of transactions in 2019. A subsidiary of PayPal, it is accepted worldwide for online transactions. Available on both android and iOS systems.
Revel Systems: An iPad-based platform mainly used for payments in restaurant and grocery stores. It is the world’s favorite POS system with a seamless UI.
Blockchain and Cryptocurrency
These are hallmark examples of online investment platforms in action. Various leading organizations have gained good benefits such as reduced costs, improved security, and better efficiency.
With the help of blockchain, the process of sending money irrespective of the amount becomes significantly faster. It optimizes conventional business models for better outcomes by making a change in the way transactions take place.
Cryptocurrency takes out all forms of intermediaries and enables peer-to-peer or direct transactions which eliminates unnecessary costs. The implementation of smart contracts is one of the most notable things as it electronically facilitates and implements an agreement changing the future of formulating deals between two parties completely.
Binance: A top-notch bitcoin exchange platform based in Malta. It is well designed to eliminate fraud and enable smooth transactions.
Coinbase: This platform manages the largest cryptocurrency exchange in the world. It enables users to easily store-purchase-sell Ethereum, Bitcoin, and more.
Blockchain: It is trusted by more than 400 million people worldwide to store and exchange cryptocurrencies. The platform handles $100 million worth of deals.
Stock Trading and Robo Advising
The asset management sector has been altered with the advent of algorithm-based asset recommendations. It is done by using smart algorithm learning which provides intuitive outcomes.
Portfolio options can now be analyzed 24/7 which helps in making informed decisions on whether to hold stock or sell it. Robo-advising has lowered the cost of portfolio management and eliminated the need for stock consultants.
There used to be a time when traders had to visit the stock exchange market to buy and sell stocks but today with the help of fintech app development, it all can be taken care of with few clicks on a smartphone. The apps have not only made trading a hassle-free process but have also made investing possible for all irrespective of any budget or constraints.
Robinhood: It promoted a zero-commission business model in the brokerage business. It supports the exchange of cryptocurrency. options and stocks.
Vanguard: It manages approximately $1.3 trillion index funds making it the market leader. Recently the majority of its online trading activities turned free.
Like most financial institutes, insurance is also heavily dependent on technology at present. It includes everything from home insurance to car insurance and data protection. Fintech app development has enabled better efficiency, reduced cost by improving risk assessment, and delivered a more reliable customer experience.
Root Insurance: It offers up to 52% savings on the car insurance policy and uses technology to test driving behavior whose score determines the rate.
Policy Genius: It provides easy-to-understand advice and gives a better approach for comparing and buying insurance. The customer gets an option to choose a policy based on their needs.
To wrap up, the evolution in finance is rapid and with time there’ll be better fintech website development shaping the future. Fintech will continue to uplift the current market and build a strong foundation for a cashless economy. More and more financial institutions are adopting fintech and soon the financial services would be more secure and easily available than ever.