What is FinTech?
Have you ever realised how nowadays, more than ever, technology is dominating our daily lives? Many times, indeed, we would barely survive without it: it has simplified many activities that were bothering us for their “physical” bureaucracy, like booking a flight, chatting with customer service, watching a movie and so on.
In particular, technology is gaining the upper hand in a very peculiar field, which is finance, proposing a real twist in the way we are intending it.
The portmanteau word FinTech, short for “Financial Technology”, indicates an emerging industry in which technology is essential to implement and improve the automation of financial activities and processes.
At the beginning, this term was used to simply identify the “back-office” technological systems used by financial institutions and banks while providing services to their clients. However, today it indicates something much more related to the services that the institution offers to its consumers. Some clear examples of fintech are of course cryptocurrencies, but also mobile banking and investment apps.
Let’s now analyse some of them!
Some practical examples
Many times we appear not to be aware of the gigantic financial revolution we are participating in, but actually, FinTech is involving us more and more day by day.
Starting from mobile banking, FinTech has simplified the way we access bank accounts: for example, users can now make a transfer directly from their mobile phone, something unimaginable a couple of decades ago. Indeed, for a quite long time, access to banking services was quite limited, forcing clients to visit some physical places even to promote some simple operations. Thanks to FinTech, all that waste of energy and time has gone away, as clients are not limited to some fixed hours to do their banking.
What is more, FinTech is playing an important role in proposing new forms of payment: thanks to digital platforms like Venmo or PayPal, now it is easier than ever to send and request money online, wherever you are in the world.
Focusing on PayPal, after registering your credit card or bank account, you can send money simply through the email address of the recipient. Then, the money can be transferred to a bank account, or better be used to make another payment. The most interesting aspect of this platform is the fact that opening a PayPal account is completely free. Nonetheless, be aware of the fact that there may be some fees depending on the payment you make (personal or commercial)!
What we do?
As you might have understood, FinTech is a huge field that involves many different activities with their specificities. Within our FinTech Division, our goal is to give you some daily pills and have a better insight into this fascinating field!
Follow our updates to become a real FinTech expert!
–Federica Butti, Bocconi University