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Frequently Asked Questions

What Is Fintech?

Fintech is an abbreviated form of ‘financial technology’, and the term describes any new technology that will automate or make improvements to the financial services sector. Fintech is typically used to help consumers, business owners and companies manage their finances more efficiently through software, computers, algorithms and smartphones.

Mobile banking and investment apps are part of the Fintech industry, as are cryptocurrencies including bitcoin. Fintech is a large and established part of the financial industry, with 41 venture capital-backed Fintech ‘unicorns’ that have a combined value of $154.1 billion.

When Did Fintech Emerge?

The term ‘Fintech’ came into use in the 21st century, with the term initially being used to describe the back-end systems of a financial institution. In recent years, Fintech has taken a more consumer-oriented turn, with the term being used to describe a variety of sectors and industries including retail banking, investment management, non-profit and fundraising.

Technology has always been part of banking and the financial industries, from the introduction of credit cards in the 1950s to ATMs, personal finance apps and electronic trading floors. The latest iteration of Fintech uses some of the most advanced technologies available, such as machine learning algorithms, data science and blockchain technology.

How Are New Technologies Changing the Fintech Industry?

Machine learning and artificial intelligence (AI) are driving change in Fintech, and other technologies – such as data-driven marketing and predictive behavioural analytics – will create further improvements in the future. Fintech has been a big adopter of automated customer service technology, using chatbots and AI interfaces to assist users with basic tasks and keep operating costs low.

Is Fintech a Growing Industry?

In 2016, Fintech start-ups received more than $17 billion in funding, and the most successful Fintech companies had a valuation of more than $83 billion in 2017.

Some of the most active areas in the Fintech landscape include digital cash and cryptocurrency; blockchain technology; smart contracts; Insurtech; robo-advisors; and cybersecurity.

How Is Fintech Regulated?

Concurrent to the rise of Fintech, regulatory technology – or ‘Regtech’ – has also been gaining ground, designed to navigate financial compliance regulatory issues. Regtech has also evolved to address issues relating to cybersecurity in Fintech.