The Fintech industry has been growing exponentially. It has revolutionized the way people traditionally think of payments and finances by integrating advanced technology. This method is replacing the orthodox ways and allowing new services that provide convenience and dependability in financial transactions.
Despite the pandemic, the fintech industry remains untouched. During lockdowns in 2021, three of four customers worldwide used fintech services instead of banking and insurance services to transfer money.
According to a CB Insights report, fintech is experiencing record-breaking investments raising more than the US $100 million. In 2022, fintech investment growth is expected to accelerate and reach US$310 million.
Here’s why this industry is here to stay and rise as the years unfold:
Lightning Speed Technology
- The backbone of fintech is technology. Machine learning and algorithms have increased automation and provided financial services that were unimaginable a decade ago.
- Automation means more production. Fintech breathes in the virtual realm and automation not only makes for faster routine operations but also frees manpower so that more attention can be given to other tasks.
- Fintech attracts larger audiences because technology makes things cost-effective. Fewer people are needed to be hired and money can be saved by the elimination of offices and other service fees.
- Fintech paves the pathway for direct access to services and information that consumers crave.
- It offers a wide range of financial services online by totally eliminating middlemen like brokers and bank managers.
- Industries need to stay on top of their game in order to survive. The demand for faster outcomes and quick returns puts pressure on parties to adapt and make improvements.
- Today large banks and many industries are adopting a progressive way of thinking and making investments in technology. They are evolving by incorporating technology for everything including online loan applications and investments.
Flexibility and Customer Satisfaction
- Consumers have high expectations and traditional banks are slow and unable to meet the needs. Unlike banks, fintech provides faster services and flexibility that are better and more efficient.
- Covid made the world come to a standstill but it proved to be a blessing in disguise for fintech and helped it grow even more. According to the Swiss Finance Institute report fintech app download rates increased from 29.2% to 32.8% during lockdowns.
- Hesitant customers turned to fintech in trying times to manage their finances. Where banks failed to provide services remotely, fintech prevailed.
- Today, many governments are actively encouraging people and steering them towards digital banking.
- According to Madappgang, “In 2016, UK Competition and Markets Authority ordered nine of the country’s largest banks to grant licensed startups access to their transaction data.” This proves that with government support new roads can be etched for other fintechs to come forward and provide innovative ways to manage finances on the smartphone.
It’s the golden era for fintech. With all the benefits it provides and the overwhelmingly positive response from the people, it can be safely said that fintech is here to stay.