World Fintech Day: How Fintech Makes Life Easier for Everyone
There’s a high chance that you’ve heard the word “fintech” before. And as you read this, you’re interested in learning what it is and why it is so important that it is celebrated on a special day.
Right here, you will learn everything you need to know about fintech, why World Fintech Day is significant and how fintech helps to make life easier for everyone.
Let’s start with a basic understanding of what fintech means.
What is Fintech?
Fintech is a portmanteau/combination of the words financial and technology. As an umbrella term, fintech or financial technology refers to any technology that improves upon existing traditional financial services to speed up transactions in the modern world of digital interactions.
In other words, fintech covers software, mobile applications and other technologies designed to enhance and automate conventional forms of finance for both corporations and individuals.
Fintech can range from simple mobile payment apps to sophisticated blockchain networks that store encrypted transactions.
Businesses use fintech to process payments, conduct e-commerce and handle accounting.
Now let’s look at how fintech works.
How does fintech work?
Fintech works in a number of ways.
First, fintech makes previously unavailable traditional financial services accessible to people and businesses in novel ways.
For instance, many traditional banks now provide customers with mobile apps that make it easier for them to access bank services while they're on the road. These services include checking their balance, transferring money and making deposits.
Second, fintech also automates the numerous services that businesses use which include loan underwriting and real estate valuations.
Third, fintech companies use artificial intelligence to better understand their consumers and to power their underwriting, product development and marketing initiatives.
How does fintech make life easier for everyone?
Fintech is an emerging industry that offers a good deal of benefits to individuals and businesses. These benefits include the following:
Easier access to loans
Before the emergence of fintech, start-ups and small businesses experienced several challenges during the process of applying and qualifying for loans.
As an industry, fintech has come to stay in that funding for businesses has become more accessible than ever before.
Cost-effective processes
Thanks to fintech, traditional financial services are able to serve individuals and businesses with cost-effective automated processes. These automated processes, in turn, help customers to have an easy and satisfying experience with businesses.
Business organisations, for instance, can now also rely on fintech to automate payroll processing efficiently leading to increased employee satisfaction and productivity.
Faster and secure payments
Organisations rely on liquidity to operate successfully, especially smaller companies with less capital. The good news is that fintech offers positive contributions in this regard by automating and accelerating payments.
Individuals are not left out. Fintech makes payments more secure than ever, reducing the risks of cybercrimes in the process – especially with levels of security that include biometrics and two-factor authentication.
Reducing the rate of the financially excluded
Fintech has helped to reduce the rate of people who do not have access to financial services at all. The introduction of agency banking services for underserved communities has helped to increase the rate of financial inclusion – and this is all thanks to fintech.
Short facts about World Fintech Day
These are a few interesting facts about World Fintech Day you should know:
It is celebrated on the 1st of August every year.
August 1st was chosen as the day for the World Fintech Day celebration to honour the passing of the father of modern-day banking, and founder of the first bank, Cosimo Medici who died in 1464.
World Fintech Day is a global event where players, fans and experts of the fintech industry gather to celebrate the industry's growth!
Happy World Fintech Day!