With the arrival of the "FinTech revolution," a new generation of startups is emerging, connecting financial services with the latest innovations in computer science. By bringing in machine learning, big data and cloud computing, they are stirring up the traditional banking sector with concepts like peer-to-peer lending, crowdfunding or wireless payments. Though originally only applied to technology at the back-end of the established consumer and commercial financial institutions, the buzzword fintech has expanded in the recent years to all technological novelties in the financial sector and refers to new applications, procedures, products or business models that are served via the Internet. Fintech solutions include mobile payment solutions, telematics-based insurances that calculate fees based on customer behavior in the area of non-life insurance, personal finance management systems or peer-to-peer lending and come in B2B (Business to Business), B2C (Business to Customer) and C2C (Customer to Customer) varieties. Several factors help explain the development of fintech as a growth sector.
For a long time, new market entrants found it difficult to break into the financial services industry. FinTech disruptors have been finding a way in. Disruptors are fast-moving companies, often start-ups, focused on a particular innovative technology or process in everything from mobile payments to insurance. And, they have been attacking some of the most profitable elements of the financial services value chain. This has been particularly damaging to the incumbents who have historically subsidized important but less profitable service offerings.
Intuitive Guide To FinTech – If you have not heard about term "FinTech"; most likely you don't belong to this world but it's ok. AILabPage defines FinTech as "Technology applied to automate, make it smart (with the best analytics, AI and ML), a speed-up and secure financial system with its own standards chiefly used by financial institutions". The financial institution here can be Banks, FinTechs or Mobile Financial Services, providers. 'FinTech' is a term arguably coined in the mid-1980s. If you look at the history it has relations since 1800 century.
It was on this date, July 11, in the year 1804 in Weehawken, New Jersey, that Alexander Hamilton, architect of the American financial system, met his fate at the hands of Aaron Burr. Some would argue that the financial services industry has changed very little since then. Change has some slowly to financial services, and innovation has proceeded at an evolutionary, some would say glacial, pace. That may be changing however. Recent decades have born witness to the introduction of technology solutions that have accelerated the transformation of consumer experience.