CPD Programs

5 Reasons why Fintech is Beneficial

Author

iLearn

Published

22 June 2020

Fintech, a portmanteau of “financial technology,” is the application of new technological advancements to products and services in the financial industry. It encompasses a rapidly growing industry from mobile banking and insurance to investment apps and cryptocurrency that keeps the interests of both the consumer and the business.

A Fintech company integrates technologies (like AI, blockchain, and data science) into traditional financial sectors to make them safer, faster, and more efficient.

Fintech Industry is one of the fastest-growing tech sectors, with companies innovating in almost every area of finance; from payments and loans to credit scoring and stock trading.

Fintech

5 Reasons why Fintech is beneficial?

The role of Fintech in society is becoming more vital than ever, particularly due to Covid-19. Whether it’s online payment systems or stock trading apps, chances are we’ve all used fintech in one way or another. In this article, we’ll look at five of the reasons why fintech is now so important.

1) Fintech has reshaped financial services

Fintech reshaped how financial institutions work from their core. Payments, loans, and finance work remained almost unchanged for years before the invention of Fintech. What used to be done by hand is now digitalized, and the margin of error is almost non-existent. Financial workers have no chance for a mistake, making financial institutions nearly unable to lose their investments.

2) Fintech helps in bringing financial services to the unbanked and the underbanked.

Unbanked individuals lack access to traditional brick-and-mortar banks due to poor or non-existent infrastructure or government regulation and also because they are insufficiently profitable for traditional banks to serve them. By pushing the transactional costs of financial services down, and relying entirely on digital access, fintech offers low-cost products and services that cater to these non-bank customers.

3) Fintech is helping us achieve a cashless society

Cash and credit cards have been the only ways to trade and pay for stuff for so long. Now, these options are almost fully digitalized and payments can be done straight through our smartphones. There is an army of Fintech software development companies that are developing new apps for better payment solutions and helping us achieve a cashless society.

4) Fintech has made financial transaction safe and transparent

Effective use of technology has ensured that there is security and transparency in every transaction. Several new benchmarks have been set by vendors, all across the globe, keeping everyone involved in a tight loop featuring full transparency. 24/7 dedicated customer support,  real-time updates, and tight security measures are some of the services that are provided through Fintech. A win-win situation for the banking industry as well as their valued customers.

5) Fintech is beneficial for economic growth

Fintech not only reduces overall transaction costs but also benefits increased GDP and job opportunities. Everyone sees the potential Fintech has and how much it will grow. Investors are readily funding Fintech start-ups and how much it is going to grow. Investors are readily funding Fintech start-ups and companies to get a piece of the action.

Conclusion

These are some of the many ways, Fintech is changing the Banking and Financial Industry. There are more changes expected in the future with further digitalisation. So brace yourself and prepare for the FINTECH future ahead.

LSF Global can help you enhance your knowledge on Fintech with our Continuous Professional Development and learning journey. To know more about our CPD programs on Fintech, write to us: connect@lsfglobal.com

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