What are the new financial technologies



The FinTech Century: 1950–2050


The first wave of modern FinTech produced technologies that define how we usemoney today, and the bulk of that innovation happened in the U.S. The adventof contemporary credit in the U.S. via the Diners Club Card in the early 1950swas a major breakthrough: It represented a much more efficient means ofpayment that also doubled as a seamless way to extend new credit to consumers.Innovation continued in the 1960s, with the Bankograph for the City Bank ofNew York: an automated envelope deposit machine and the first prototypicalATM. U.S. leadership in the FinTech space, led by the banking sector and othertraditional financial institutions, continued through the 1990s with theproliferation of the internet and the birth of online banking. While majorbanks still ran the show, these major stages of development were unified by acommon theme: the expansion of banking and credit to the world outside ofbrick-and-mortar branches.The second wave of modern FinTech, beginning in the 2000s and cresting now,came from Asia, and China in particular, which created a battery of widely-adopted innovations. With a massive population to whom physical banking hadnot previously been ubiquitous, the country’s strides came through smartphoneapps. In 2018, China’s $25.5 billion FinTech market accounted for 46% of allFinTech investments globally, making it the largest such market in the world.WeChat and Alipay are such high-performing payment platforms that even ruralvendors and laborers flash personalized QR codes. Tencent and Alibabafrequently launch large-scale investments that cut out traditional financefirms. Anything from wealth management (players such as Lufax dispatch theirservice entirely online) to credit scoring and provisioning (Bairong boasts74,000 data labels on 800 million individuals to calculate their scores) haveestablished strong footholds.Now, though, the center of FinTech innovation seems to be shifting again, thistime to Africa. United by mobile phone proliferation, and often in the absenceof internet-capable phones, this wave is defined by its inclusive mobilebanking services. Africa is host to 33 of the world’s 47 least developedcountries by the U.N.’s categorization. Infrastructure for universalsmartphone and Internet use, which took several decades to establish in theU.S. and China, is still in its early stages. Yet for FinTech, what would be abane to other regions is instead a boon that could see it leapfrogging farahead.Unlike previous waves, which had relied on technologies at the forefront oftheir times, the African FinTech wave is being built on mobile phones, whoseadoption in the continent accelerated around the turn of the millennium andare now pervasive. This launched a swell in economic growth: according to IMFestimates, four of the top five highest GDP growth rates in the world are inAfrican countries benefitting from this boom. African countries that missedout on the older U.S. and Chinese FinTech waves’ outputs have already startedto fly directly into hyper-efficient mobile infrastructure.The definitive exemplar is Kenya. The country has seen skyrocketing mobilepenetration rates, with subscriptions surpassing the total population amountby 12%, and FinTech innovations have followed. For example, thetelecommunications giant Safaricom, which contributes 5% of the county’s GDP,led the push in 2007 with its M-Pesa money transfer service, which functionsmuch like a limited mobile bank but without the need for an Internetconnection. M-Pesa combines Safaricom’s mobile infrastructure with an agentmodel; Safaricom stores their balance and customers can go to one of 110,000agents throughout the country to conduct transactions in person. The wholesystem runs on technology similar to text messaging, and has expanded to sevencountries.Equitel, a mobile virtual network operator competing with Safaricom’s M-Pesa,is pushing boundaries for financial inclusion even further by offering a fullsuite of banking services on mobile devices. Conceived equally throughingenuity and necessity, Equitel is a new type of hybrid firm: atelecommunications company born of a bank. Parent company Equity Bankcollaborated with international telco Airtel to give users a product comingfrom two longstanding companies. It sent agents throughout the country, evento remote areas where other banks and telcos had not ventured, to demonstrateusage. Equitel grew to capture 22% of the mobile money market in just fiveyears through this locally-focused strategy.These companies have vastly expanded financial inclusion in the country. Whilefinancial inclusion in Kenya was at just 26% in 2006, today 83% of thepopulation has access to at least basic financial services. Besides simplybecoming exports, these innovations have become models for other Africancountries. Twenty-four countries have committed to a Digital Economy Blueprintfollowing Kenya’s example. Results are spreading — the GSMA estimates thatWest Africa’s mobile penetration has doubled over the past decade, with mobilepayments and banking driving development in its 15 member states. By the endof 2018, the region saw an increase of 23 million mobile money accounts fromthe previous year. Women, the rural poor, and the displaced are especiallybenefiting by the use of FinTech as their gateway toward empowerment.

Portable Lessons


What can the rest of the world learn from Kenya’s FinTech’s success stories?There are three actionable themes that companies should take note of.First: successful companies live and die on bundled feature delivery. EquityBank shot ahead of competitors, from 66th to 2nd, due to its one-stop shopappeal. That consumers prefer the lower search and implementation costsrelated to bundled services is not specific to the African market — in theU.S., over 50% of product searches start on Amazon, where 44% of all onlinepurchases occur. The trend toward universal solutions extends as much toFinTech as it does to retail.Second: finance is about trust. Traditional banks in the U.S. are keenly awareof this, but they consistently fail to transfer that trust into cutting-edgeproducts. Young FinTech firms, on the other hand, offer all the agility butcome without the decades of built-up trust. The breakout success of Kenya’sFinTech companies hinges, in great part, on their ability to combine trustedand emerging brands. Equitel, a hybrid firm, was able to flourish by borrowingconsumer trust from the long-established brands Equity Bank and Airtel. Firmsin the U.S. looking to learn from their example would do well to seek outcompany partnerships that would allow innovative services to run on knownrails.Third: look for technology enablers. These are subtle, but criticallyimportant, conditions or infrastructures that couple with a technology toenhance its likelihood for success. These enablers need not be recentinnovations, but are often salvaged from dying or outdated models. For Amazon,its extensive use of intermediating warehouses, a method that itself wasexpected to taper out as direct shipping proliferated around internetpurchases, acted as an enabler to their online platform. For African FinTech,Safaricom’s use of in-person and widely spread agents to kick start M-Pesaended up being the product’s key multiplier. Those looking for enablers shouldconsider what dormant or underused resources exist that can be pairedalongside a given innovation to see it grow.

What U.S. Companies Need to Learn — and Fast


For the U.S., there are two challenges that the next great FinTech innovatorswill address.The first is targeting financial literacy. According to Standard & Poor’s,only 57% of American adults are financially literate. Millennials, now between25 and 40 years old, manage just 24%. While this generation is already used tohaving its money in a purely virtual space, it is not used to engaging with aband of financial products traditionally dispensed from brick-and-mortarinstitutions. In light of this, Kenyan companies offer useful examples; theupskilling provided by its innovators went on to have a neighbor-teaching-neighbor effect. Millennials are especially prone to viral trends, and thusfinancial literacy may spread rapidly if new FinTech companies chooseinfluencers carefully.The second is personalizing needs and delivery. What Americans want most is asolution set that matches their profile while not demanding backgroundresearch. Like the Kenyans who initially sent money only to find that theoffer for a savings account within the Equitel app matched their needs,Americans feel more comfortable with an all-in-one approach. Savings formarriage, childcare, and retirement, as well as bequest, insurance, andinvestment services should be streamlined together, with prompts of whatproducts to consider and when.These lessons would serve banks well, but non-traditional financial playershave just as much of an opening to get involved in the U.S. As WeChat wentfrom social network to money management service, and as Equity went from bankto mobile network, the lateral moves across industries that moderntechnologies allow should be explored by firms of all stripes. Partnershipsbetween industries to launch joint products, rather than an everyone-does-everything approach, should also be examined; not with disdain at having toerode an existing brand, but with opportunism at identifying an untappedcorner. While it seems traditional banks are in no danger of losing the lion’sshare of the retail banking market for now, it is also clear that those whowill thrive in the years to come will have closed the gap between crumblingbrick-and-mortar and flashy tech.The modern waves of FinTech, from the U.S. to China and now to Kenya, providea framework for assessing who is ahead and who is behind in terms offulfilling a population’s financial needs. What remains constant acrosspeoples is a desire for access and a need for trust. Harnessing these tandemforces to solve consumer problems can propel less developed countries tosurpass developed ones. Reimagining these forces, with lessons learned frombudding leaders, will be vital for keeping up in the wave of innovation tocome.List of Top Fintech Startups in USA [2021]Fintech or financial technology in the last decade has been one of the world’smost promising sectors. FinTech has changed the way finances are conductedwith mobile banking, investing, and blockchain apps. According to the ModernKnowledge World, the centerpiece of this technology trend is the United Stateswhere 1,491 startups and $58,5 billion invested in the sector. Yet banks are not the only financial institutions that have changedtechnologies. Digital financial access is embedded in entire markets,including digital loans and mobile stock systems, e-commerce payment networks,and digital currency exchanges.What is Fintech all about? Evolution of Fintech in the USA List of top Fintech Startups in the USA 1. Stripe 2. Chime 3. Plaid 4. SoFi 5. Coinbase 6. Ripple 7. Toast, Inc. 8. Spur 9. Credit Karma 10. Opendoor 11. Root 12. PaydiantConclusion FAQs

What is Fintech all about?


What is fintech?Fintech means Finance + Technology which refers to the amalgamation of bothinto software that seeks to improve and automate the delivery and use offinancial services.Fintech defines any business offering financial services through software orother technologies, from smartphones to cryptocurrency payment applications.Fintech firms have changed nearly every part of the finance sector in recentyears. Ten years earlier, individuals had to visit a branch or bank to applyfor a deposit, a credit or to transfer funds literally from one bank toanother. At present, Fintech has made it possible, without having ever steppedin a bank to spend, borrow, save, and move funds through online and mobileservices. Although conventional institutions are picking up technologies fromfintech steadily.Top 20 FinTech Startups of India | Indian Fintech Companies in 2021Fintech, short for financial technology, has become a crucial part of theglobaleconomy., all financial tasks were completed through paperwork only,aspaper-based medium was considered to be the safest. But with the developmentoftechnology, internet has emerged as the preferred platform for fina…

Evolution of Fintech in the USA


Fintech was even longer than most people believe. Though Fintech’s currentversion helps you to pay for a coffee cup with a smartphone app, financialinfrastructure history goes back to the first credit cards accepted by thepublic at the end of the 1950s.Financial technologies developed and implemented many significant milestonesin the mass market after the credit card, such as ATMs, Electronic Shares,Mainframe Bank computers, and internet stock exchanges. Many moderntechnologies improved the financial system that most people used, but had tothink seldom about every day.Today, solutions from the Fintech industry challenge existing bankinginfrastructure, for example by using a payment app on the mobile wallet,rather than the carriage of physical credit cards in a physical wallet.Fintech’s various markets have been revolutionized, particularly in thefinancial, commercial, insurance, and risk management industries. Fintechfirms include startups, technology companies, and existing financialinstitutions leveraging digital innovations such as big data and artificialintelligence to enhance financial services usability and performance,blockchain, and edge computing.Blockchain technology in Banking Sector – StartupTalkyFrom early history, the banking industry has been acting as an intermediarytoconduct financial transactions. Technology has always had an impact onthebanking system. Major banks and financial institutions are realizingthatblockchain technology could vastly improve the efficiency of their proce…

9. Credit Karma


Credit Karma Logo | Top Fintech Startup in the USACredit Karma is known best for its free credit and loan reports. It is howevera platform that provides its customers the ability to create a strongerfinancial future. If you wish to use Credit Karma you should give your name and the last fourdigits of your Social Security number. You should have simple personalinformation. Credit Karma can then view your loan report, collect and make itavailable to you with your consent. For users who utilize credit card reviews,personal, home-and-auto loans, or auto insurance, Credit Karma earns a bigreference fee.* * *Reasons Why These Startup Sectors Bloomed During LockdownIn the unprecedented time, where everyone is talking about the economicslowdownand financial difficulties, there have been a few startups sectorsthat havemanaged grow exponentially well. The covid 19 has shaken the worldand hasbrought many business to a halt, although startups have lost their …* * *

Conclusion


Through this article, we learned what exactly Fintech is and how the evolutionof fintech in the USA took place. During the COVID–19 pandemic, particularlyin emerging markets, the Fintech industry continued to help expand access tofinancial services with strong growth in digital financial services of allkinds. For poverty reduction and economic development, access to qualityfinancial resources is important. The access and use of basic financialresources for poor people, in particular women, will increase wealth,strengthen resilience, and better their lives. Fintech developments aim tolower the costs of service supply, enable more customers to be served andreduce the need for face-to-face contact, critical to the pandemic’s continuedeconomic activity.* * *Top 10 Fintech Startups In EuropeIn recent years, the European fintech startups scene has expandedexponentially.Open banking is one of the main drivers of this development.This will lead tofinancial services and fintech partners supplying customersthroughout Europewith more creative and user-friendly solutions. Governmentsup…* * *

How does technology help finance?


The impact of technology on financial services allows the customer to avail ofeasy digital transactions.

How does technology affect the financial industry?


The arrival of smart analytics helps the financial industry to understand itscustomer better and provide services accordingly.

What are the new financial technologies?


Blockchain, Robotics, Artificial Intelligence, Cryptocurrency, and many more.

What are the top Fintech companies?


Square, PayPal, Goldman Sachs, Green Dot, MercadoLibre, and many more.

Is Fintech a good career?


Fintech would be considered as a good career opportunity for people who areseeking to build their career in the field of finance domain.

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