Business & Finance

What Exactly Is FinTech? Types, Benefits, and Examples (Included)

What Exactly Is FinTech Types, Benefits, and Examples
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According to Statista, as of November 2021, there were 6,268 FinTech startups in the Asia Pacific region. It clearly shows that finance is one of the most data-affluent and inventive industries today that has created the most trendy solutions in the finance field. Moreover, it has integrations with trendy technologies to provide better financial services to businesses, companies, and consumers. The dramatically increased use of smartphones for online banking, investing, borrowing is the best example of the technologies focusing on making financial services handy to the general public. 

What Exactly Is FinTech?

FinTech is a combined word for Finance and Technology. It is the innovation that competes with the traditional financial methods in providing financial service. It has changed its shape and size from InsurTech and cryptocurrency to mobile banking and investment apps. 

However, FinTech application’s structures vary from project to project. Many apps use machine learning algorithms, data science technologies, and cutting-edge solutions like blockchain to perform various tasks like processing credit risks or running barrier funds. 

FinTech companies consist of startups, settled financial institutions, and technology companies trying to exchange or increase the usage of financial services provided by an existing finance company. 

See Also: Top 5 Challenges in Developing FinTech Apps


5 Benefits of Using FinTech Apps

1. Convenience

FinTech uses mobile connectedness to boost the accessibility and ability of online transactions and mobile banking. Many consumers are using smartphones and tablets to manage their banking. The apps can help establish these processes, accomplish more, and get a good experience. 

2. Personalization

FinTech app development company, while developing FinTech apps, generally adds data analytics. This helps to easily track and reach the customer’s increasing demands and needs. Because of all this data, organizations can easily convey personalized experiences and products to customers. The whole business model is now built based on access to an ample range of customer information. 

See Also: How 5G Will Change the Smartphone Experience?

3. Faster Processing

FinTech apps improve the convenience of different finance products by boosting the approval rate. This is related to banking and insurance products. Many companies use the FinTech application to automate and improve the speed of the approval process so it can get completed within 24 hours. 

4. Security

One thing that all the FinTech apps have in common is focusing on security. FinTech app development companies use trendy and secure mobile technologies to develop their product. They spend on security to ensure that consumer data is safe or not. Biometric verification and data encryption are the most commonly used security measures used in the context. 

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5. Cost Reduction

FinTech companies can provide fewer fees than traditional banks. They don’t have extra costs such as advertisements or rentals. Instead, they can spend all their revenue on product development to improve their bid. 


FinTech Categories, Types and Examples

4 Main Categories (Types) of FinTech Apps

Before starting Fitech app development, it is crucial to know about the different types of FinTech apps to decide which type of FinTech app they want to develop.

1. International Money Transfers

Payments are the largest category of the FinTech industry. Digital payments reduce the burden of carrying cash with you; one can efficiently perform cashless payments through online payments. Many digital wallet apps can allow you to pay online safely. 

Many payment companies have changed the way of payment with fast and secure digital payment methods. Sending money online has become so easy with just a few clicks with the help of comprehensive connectivity, low cost, and security. These companies offer safe online payment transactions, finance management, and account details. 

There are two types of payment apps that are:

  • Paypal: It is a digital app for online transactions between customers and vendors safely. Paypal allows linking your debit or credit card with your Paypal account. 
  • Payoneer: It is also an online payment app that allows overseas transactions. Among other freelancing apps, Payoneer is the most popular freelancer. 

Related: Best PayPal Alternatives for International Payments (SMBs)

2. Mobile Payments

Digital payment has made every smartphone user use an online payment app for safe and fast transactions. This increasing online mobile payment technology has brought many changes in this industry that have become very beneficial for customers for online transactions or paying online. 

This is another field where the FinTech app has significantly affected the mobile payment industry. Any transaction that a customer makes will involve payment processing. Customers and businesses use mobile wallets or many other payment apps.

See Also: Best Online Payment Gateways for eCommerce Businesses

3. Net Banking

Most banking and financial institutions use net banking benefits for their customers to provide them with a better user experience. Every important banking institution holds a mobile application available to the account owners. This FinTech app helps avoid the banking difficulty, costs, and the problem of receiving the service. However, in the net banking category, we can also consider lending, insurance, and consumer financing apps.

Related: How Do You Develop a Financial App?

5. Blockchain, Cryptocurrency and Investing

Blockchain and cryptocurrency are noticeable examples of FinTech apps. Cryptocurrency is trendy from digital currency and getting into the limelight with the help of Bitcoin and Litecoin. However, it is undergoing many arguments around safety and validity.

Nevertheless, blockchain provides smooth transactions, wise contracts, trading platforms, and immutable data records. This technology allows for tracking the whole life-cycle of financial transactions. 

Also, there are thousands of investing and trading apps created using the FinTech concept. People are using those apps to invest money in stocks and trades.


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Conclusion

As we all know, the FinTech app has changed our banking industries and the transaction by switching to digital payment. This blog will get complete information about the FinTech app and the benefits and types of the FinTech app. You will also get to know about finTech app development for your Business. 

I hope this blog will help you develop your FinTech app for your Business.

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