Question

What is FinTech? Give some examples. Is the U.S. ahead or behind in the FinTech revolution. How do you think FinTech will change financial transactions in the next decade in the U.S.?

Answer 1

FinTech (or Financial Technology) refers to those technologies and innovation that delivers financial services to people in a way that is completely different from the traditional financial methods. FinTech makes use of technology so as to improve delivery of financial services and improve activities in finance. In other words FinTech is the use of technology and computer programs to enable as well as to support banking services and financial services.

The U.S. is ahead in the FinTech revolution. The country saw many FinTech companies being founded in the mid 2000 before the Fin Tech revolution swept the entire world. Although USA cannot be said to be a pioneer in the FinTech industry it certainly is ahead in the revolution on a relative and comparative basis. Companies like GreenSky was founded in 2006, Credit Karma was founded in 2007, Oscar and Avant were both founded in 2012 and these are huge names today in the FinTech industry. Other large USA companies in this industry are Lending Tree, Affirm, Green Dot, Quicker Loans etc. It should be noted that USA is only behind Asia in the FinTech revolution.

FinTech will significantly change financial transactions in the next decade in the U.S. The next decade will witness increased level of convergence and collaboration in the financial services industry, thanks to Fintech. There will be increased level of alliances between financial service providers and payment gateways. This will help in serving the changing needs and demands of consumers in an optimal manner. With increased level of digitization FinTech will provide financial services in a real time basis in future and the services will be location based and provided in a decentralized manner.