From digital payments to lending technology, here’s what investors need to know about fintech and why it may be an area of opportunity. The digitization of the financial industry has accelerated in recent years, and investment in fintech has emerged as an attractive wealth-building opportunity for investors.
1. What is the future of the fintech industry?
The financial technology sector is advancing in many ways, both locally and internationally, in areas like real estate, peer-to-peer lending, auto financing, and general lending. Both the wealth management sector and portfolio companies are recognizing the benefits of fintech. Fintech companies are using the power of AI and machine learning to analyze data and provide insights that serve to benefit both businesses and consumers. Investors also need to adopt a forward-thinking mindset. It can take several years for a fintech to mature and generate profits.
2. Insurance technology
Many insurance companies are adopting fintech to smoothen. As insurance companies increase their digital footprint, customers need not wait for days for insurance premiums to be calculated. Based on analytic data, insurance calculations is now faster, through apps and software.
3. Types of fintech companies
Some of the most common types of fintech services include
Banking: Fintech banking services consist of a variety of apps and software that enable consumers to open accounts, protect their accounts from fraud, and receive direct deposits faster.
Payments: Payment services are the most common offering by fintech, according to Deloitte. Digital payments allow consumers to pay bills, shop using contactless payment methods, and send money.
Financial management: Fintechs in this category are designed to make managing personal finances easier for consumers, providing services such as tracking spending and automated savings.
4. Fintech uses
Modern financial services range from the simple to the complex including
- Online and mobile banking platforms.
- Peer-to-peer and other tech-focused personal lending platforms.
- Mobile payments.
- Contactless payments, allow consumers to pay in-store without swiping or inserting their payment cards.