FinTech is an industry that has revolutionized the way finances are handled in today’s digital era. It has improved and automated the interaction between users and financial services providers, or the finance world in general.
This growing industry competes with traditional banking through a different proposal of value. This model is based on new transaction schemes that take advantage of digital media to develop simple, immediate business models.
The services offered by this revamped industry are plenty. They range from transferring funds via mobile apps and applying for credits online to sending remittances or starting a saving plan. All this without having to visit a bank branch or other intermediaries.
Underbanked and unbanked populations are also a target for such services because they prove to be a good market opportunity.
Taking Full Advantage of Resources
Another fundamental characteristic of fintech companies is they specialize in satisfying specific needs in the fastest, easiest way possible by means of the technology that modern society prefers and relies on. These startups find potential customers in the large percentage of people who connect to the web.
According to the Internet World Stats (IWS), smartphones are the most popular Internet-enabled devices globally, followed by laptops.
This suggests that the best strategy for fintech companies is to provide services through mobile applications aligned with users’ needs.
The number of both web-connected devices and consumers who have access to the Internet is on the rise. However, it’s worth mentioning that fintech companies have not reached their full potential yet; there are still multiple business possibilities available to them in spite of the fierce competition in the industry.
The habits of Internauts across countries change on a constant basis too. Surveys conducted by the Gartner Group found that 47% of United States adults use digital banking services, while 76% of them shop online.
The legal landscape for the fintech industry continues to evolve. Governing bodies and agencies around the world have issued regulations, policies, and initiatives that fintech companies must observe to create added value, and consequently differentiate from competitors.
Due to the constant transition of financial services in terms of practices and paradigms, different development options and new business opportunities are provided. Now companies and start-up founders can seek to conduct transactions with the aid of technology.