Blog  /  Business  /  Ways Fintech is Transforming Everyday Life
SEPA, SWIFT & TARGET2: What’s the Difference?

Ways Fintech is Transforming Everyday Life

Time to read: 5 minute(s)

Traditional banks have been and will continue to exist on the market – at least three-quarters of the population still turn to them for services. But in recent years, in front of long-established traditional banks, a new competitor, fintech, has been growing. The fact that people began to massively switch to more innovative technologies is not the main driving force behind growth. Those who have at least once tried to use services based on artificial intelligence remain customers due to certain advantages:

  • fast service delivery;
  • personalization;
  • instant solution to a vital issue;
  • availability online and anywhere in the world.

What’s a fintech company? Demand for fintech banking services spurred a recovery in overall transaction volume in Q4 2020. This indicator gives a sense that the fintech industry will continue to develop further and will be a big push for start-ups that will better serve their customers.

Implementing these innovations is only the first step. Almost all areas of the financial industry have succumbed to the changes triggered by financial technology. Judging by some reports, it can be seen that investments in this industry jumped from $5.6 billion to $12.2 billion in the years 2014-2015. It’s not just about money: fintech will have an impact on expanding access to banking services, spreading financial literacy and creating new opportunities for those at different income levels. Some experts note that now humanity is on the verge of the next revolution and it is important to be able to adapt to it.

Banking Gets Easier

How does fintech work? It’s hard for the younger generation to believe, but in the past, you had to take a day off to solve banking problems – those days are behind us. Time spent in queues is long gone and people are given the opportunity to have access to all banking services from the comfort of their homes, simply using a smartphone. Fintech has made banking a lot easier and has dramatically changed the way banks operate and the behaviour of their customers.

From the visible consequences of how financial technology has made life easier for people: now you can make purchases online and pay for them in the same place via a smartphone; You can apply for a loan with just a few clicks. This is a complete transformation of life and the banking segment. All banking services have become personalised and therefore more efficient and convenient. A person does not have to go to a physical office to check the balance on the account – it’s all there in the smartphone.

The Right Investment

What does fintech do? Fintech promises a personalised service to each client, or at least an expansion of their reach. If you go back in history, you can remember that in the mid-1970s, one transaction alone cost unrealistic money and it was said that infestation was only for the rich. Then in the 1980s and 90s, with the advent of certain technologies and their combination with regulatory changes, the financial world came to the fact that consumers began to make their own transactions – only those who had an understanding of how markets and securities work.

In comparison, in the last 2 decades alone, emerging technologies have brought so much democracy to the financial world that anyone can participate. To provide automated investment management based on algorithms, robot consultants came to the rescue.

One prime example of the benefits of new technology is Betterment. They have patented algorithms since 2008 that can be used to determine where customers should invest their money. Their specialisation is passive investing, where they prove that advisor robots are better than humans. The company has a main idea – to help people use all their money wisely. Online client counselling is truly accessible to everyone, making infestation easy for everyone.

Trading in the World of Cryptocurrency

In the future banking industry, cryptocurrency will be its defining factor. Cryptocurrency is based on a technology called a blockchain. People learned about it when they first heard about bitcoin.

Who is fintech in the world of cryptocurrency? In the financial industry, blockchain is used for security and other purposes. In simple words, cryptocurrency is money in digital form, and cryptography is used to secure transactions for such money. Two parties can use digital currency to transfer their wealth faster and more easily. Blockchain is a highly decentralised technology that makes it impossible for hackers to trick or hack it – fraudulent transactions almost never take place in this system.

Properties for Rent

In the place of a student who moves to New York and is looking for his first apartment there, you can be frightened and confused by the existing rental market in the city: landlords require high income from tenants or such funds are available to cover rent for at least half the term or hire guarantors .

TheGuarantors is a company that provides B2B services. She appeared after the young Julien Bonneville, moving from France to study at the university, could not find housing. Asking himself how to make this process easier, he came up with the idea of ​​​​creating a product that would enable landlords to subscribe to the company’s services. Thus, if the tenant does not have a guarantor, the company offers to jointly sign for the apartment and issue a deposit to the landlord, which is provided by the insurance company. Fintech plays the role of an accelerator in this process – TheGuarantors company can process applications within a couple of hours and quickly inform the company if the tenant is late in payments.

Equity in the Economic Structure and Access to It

Fintech, primarily through its ease of use, has created many opportunities for those who did not have them. For those who have traditionally been denied access, they are now in the spotlight, as it is in the interests of both parties – both the financial sector and the new client.

On the business side, the market is now littered with newcomers, newly formed companies that are creating competition and challenging traditional financial institutions that have been in the market for a long time. The main difference is the use of customer bases in an unconventional way – the use of data to personalise services. With the decline in the number of traditional institutions, the issue of equity and access is being addressed more and more quickly.

Small Business Development

Is fintech a good career? Actually, yes. Fintech has also affected small business entrepreneurs by changing the rules of the game. Any startup usually needs a loan, which they ask for in a traditional bank – the process is complex and long. But today there are a lot of FinTech-based companies that give loans to small businesses, offer payroll management for employees, and process company payments.

Previously, the creation of a small business was considered a particularly high-risk area, but after the advent of fintech, this has changed radically. Fintech has made a big impact on this sector in terms of accelerating development and transformation.

Savings Accounts for Kids

The popularity and rapid growth of fintech is influenced not only by innovative technologies, but also by changes in the situation in the world in the field of social norms. This opinion comes from the founder of Ballooning Nest Eggs, a company that allows parents to fund a special children’s savings account through crowdfunding. This platform works on the main discomfort in life – asking for money. The company’s interface looks like a platform where you can post photos and history of events from their lives. Platform subscribers can donate to each child’s long-term savings account. In this way, parents allow other people to give money to their children.

Such a platform simply uses technological innovation, benefiting from a change in attitudes towards money and the way it is spent. Statistics show that more than 22% of newly engaged couples receive gifts of money on their money registers. The creator of the platform believes that it is possible to benefit from the use of technology even for the comfort of spending and getting cash for children.

Changing life with fintech starts when you use modern tools like online banking. PayDo is a cutting edge payment service provider, an alternative to classic banking that supports lots of services like SWIFT/SEPA transfers, card top ups and payouts,P2P payments and currency exchange within the account. Manage your business remotely or use your account for personal purposes – PayDo is the choice of people who appreciate their time and want to stay up to date. Learn more and register today.

What is an IBAN Number and How Does it Work?
Stay up-to-date
Get our news earlier than others