Some of these include online marketplaces that link borrowers with investors and even artificial intelligence-based products that help users find lenders based on their current circumstances and needs. Just when the world thought tapping a credit card on an EFTPOS terminal was as easy as it gets for making payments, fintech delivered an even more convenient solution. This uses near field communication technology to allow customers to make contactless payments by holding their phone over a payment terminal, such as Square Reader or your everyday EFTPOS terminal. From software companies working on financial services apps and programs to those building financial service hardware solutions for business.

  • Thanks to Fintech, all businesses, irrespective of their size get highly competitive exchange rates.
  • For example, wealth and financial management apps will aggregate financial account data from different accounts into one easy-to-read snapshot, showing users all of their financial information in one convenient place.
  • Underbanked refers to individuals who are not getting the financial services they need, usually because they are insufficiently profitable for traditional banks to serve them.
  • According to the Federal Deposit Insurance Corporation, banks grew from around 13,500 commercial bank branches in 1950 to over 83,000 in 2008.
  • Even your Starbucks app is a form of financial technology in that it facilitates payments and a proprietary rewards program using a mobile device.

A Fraud Detection software is designed to raise flags over suspicious transactions and alert the administration for further investigations. Apart from the four categories above, let’s focus on some of the most popular examples that will make FinTech easier to understand. Crowdsourcing allows people with big ideas to obtain funding swiftly and easily across the world, even from investors they never had met.

The annual Forbes Fintech 50 spotlights the hottest and largest companies in the industry. The 2022 list is topped by Stripe, a decade-old payment processor with a $95 billion valuation. In second place is Klarna, a 16-year-old Swedish firm that offers consumers financing for purchases at many major retailers; it was valued at $46 billion. M-Pesa is a mobile banking service that allows users to store and transfer money through their mobile phones. Financial inclusion is the effort to make financial products and services available and affordable to all individuals and businesses.

Fintech Companies to Know

This access gives consumers alternatives to predatory financial services such as check cashing and payday loans, some of which charge over 600% interest. SumUp is on a mission to empower small merchants by offering easy-to-use payment solutions they usually can’t get through traditional banks and other financial institutions. Through SumUp, businesses can purchase a POS system, card readers, open a business bank account and more. The company also facilitates solutions that can streamline payment experiences.

Our shopping insights dashboard allow merchants to analyze their market and grow their business with confidence. Enable hyper-personalized FinTech experiences with the most comprehensive, accurate data and intelligent APIs. Structured Query Language is a programming language used to interact with a database…. The Structured Query Language comprises several different data types that allow it to store different types of information… The fintech revolution has created a variety of important and growing subcategories. They include the aforementioned “defi,” “insuretech” , and “regtech” , among others.

What is Fintech (Financial Technology)? Types and Examples

It’s tearing down the old silos and helping to advance the consumers’ financial situation and outcomes by leveraging advanced technology. Combine actionable consumer insights, peer benchmarking data, personalized views, and critical data needed for segmentation to enable contextual, hyper-relevant customer interactions. At its core, open banking is about access to data—and that complements our core competency. Consumers expect immediate access to their money and transactions; you can make it happen with Envestnet | Yodlee®. Deliver next-gen financial experiences with conversational AI that guide consumers toward financial wellness.

What is an example of fintech

The offers that appear in this table are from partnerships from which Investopedia receives compensation. Investment apps like Robinhood make it easy to buy and sell stocks, exchange-traded funds , and cryptocurrency from your mobile device, often with little or no commission. Robo-advisors, such as Betterment, utilize algorithms to automate investment advice to lower its cost and increase accessibility. That said, many tech-savvy industry watchers warn that keeping apace of fintech-inspired innovations requires more than just ramped-up tech spending. Rather, competing with lighter-on-their-feet startups requires a significant change in thinking, processes, decision making, and even overall corporate structure.

Executive Programs

Fintech is also a keen adapter of automated customer service technology, utilizing chatbots and AI interfaces to assist customers with basic tasks and keep down staffing costs. Fintech is also being leveraged to fight fraud by leveraging information about payment history to flag transactions that are outside the norm. Broadly, the term “financial technology” can apply to any innovation in how people transact business, from the invention of digital money to double-entry bookkeeping. With so many people using fintech, it’s beginning to reshape our financial world.

Stripe’s internet commerce platform provides tools for marketplaces, subscription services, e-commerce businesses and crowdfunding platforms. Millions of online businesses — including Pinterest, Warby Parker, Kickstarter, Instacart and Squarespace — have used the platform to manage payments and structure online billing processes. Linked to a user’s financial accounts, it invests change from purchases in a diversified portfolio. Other products and services include IRAs, debit accounts and informational content that enables users to invest automatically and learn as they go. Billtrust provides payment cycle management solutions to business services, manufacturing, transportation, distribution and equipment companies. Billtrust aims to accelerate the invoice-to-cash process, automate cash flow, give a company’s customers more flexibility and enhance organizational and operational efficiency.

For example, investment bank Goldman Sachs launched consumer lending platform Marcus in 2016 in an effort to enter the fintech space. Some examples include transferring money from your debit account to your checking account via your iPhone, sending money to a friend through Venmo, or managing investments through an online broker. According to EY’s 2019 Global FinTech Adoption Index, two-thirds of consumers utilize at least two or more fintech services, and those consumers are increasingly aware of fintech as a part of their daily lives.

Embedded finance refers to financial services offered seamlessly in consumers’ everyday experiences through non-financial products and services. For example, Shopify Balance provides business checking accounts for Shopify users that help them get paid faster and manage their business. Shopify isn’t a financial institution, making Shopify Balance a financial product ‘embedded’ in a non-financial product. Companies like Unit and are helping make this ubiquitous, through API integrations that embed financial services directly into the product or user experience of non-financial companies. With its cloud-based network, Arcesium enables companies to make informed business decisions. The network offers financial data management services, allows users to review investment risks and provides real-time status reports on reconsolidation.

What is an example of fintech

Fintech offers a fascinating case study of a market infused with new technologies and unmet needs. The rapid pace of change in society today—be it social, technological, or both—has created what appears to be an entrepreneur’s paradise, as demonstrated by the proliferation of fintech startups. In other words, specific technologies (i.e. blockchain) are less important than matching the right technology to the current—or future—social change.

Fintech Neobanks

This security challenge is also faced by historical bank companies since they do offer Internet-connected customer services. Robotic Process Automation is an artificial intelligence technology that focuses on automating specific repetitive tasks. RPA helps to process financial information such as accounts payable fintech industry and receivable more efficiently than the manual process and often more accurately. AI algorithms can provide insight on customer spending habits, allowing financial institutions to better understand their clients. Chatbots are another AI-driven tool that banks are starting to use to help with customer service.

What is an example of fintech

In the Americas alone, the number of fintech startups increased from 5,868 in 2018 to 10,755 in 2021. That same year, global fintech funding reached a record $132 billion, accounting for 21% of all venture capital dollars. Every major fintech category saw record funding in 2021, an indication of broad interest in the industry.


Customers can also get paid early, receive the Kinly Visa Debit Card and access various ATMs without withdrawal fees. Businesses can use Adyen’s platform to accept payments online and in-person, detect and respond to potential fraud, get insights about customer behavior, issue both physical and virtual payments and more. Spotify, Uber, ebay and Microsoft have been among the brands that have worked with Adyen.

According to a 2019 survey by FDIC, nearly one in five Americans is either unbanked or underbanked. Today’s challenge is identifying how to harness the changing landscape of fintech to the benefit of your business. Here are five important trends that may help you strategize your next move as you think about how fintech can—and will—impact your organization. The real challenge is identifying important trends and anticipating how they may impact your industry and your organization. But in fact, there’s nothing particularly mysterious about fintech, blockchain, or any of the other buzzwords getting thrown around.

Banking as a Service (BaaS)

Fintech banks create a standard where overdraft fees are more avoidable and financial institutions follow suit—helping create a financially healthier environment for all. Plaid streamlines the loan process for borrowers while giving lenders access to the user-permissioned bank, payroll, and other data they need to make informed lending decisions. In this way, it becomes fast and easy to verify borrowers’ identity, assets, employment, and income, as well as authenticate their accounts, check balances in real-time, and verify financial obligations. PFM apps help users consolidate financial information from various accounts into a single dashboard, making it easier to stay up to date with their finances.

Drive growth with intelligent solutions

It is a kind of lending based on the future revenue of a company that will be generated through sales. There are many online options available to get financial assistance of any kind. Similarly, another Fintech company – CompareAsiaGroup, provides reliable information about how to save money and manage personal finances. A mobile payment app helps reduce the cost of development and maintenance for companies.

New innovations in fintech are allowing financial institutions to serve customers in novel and unexpected ways. Crystal ball predictions in venture-heavy markets are never easy, more so when a global pandemic and shifts in political power are in play. On the regulatory front, signs are mixed, said Laura Kodres, a past distinguished senior fellow of the Golub Center for Finance and Policy at MIT Sloan. A 12-month program focused on applying the tools of modern data science, optimization and machine learning to solve real-world business problems. Kinly employs financial education and technology to assist Black Americans in building generational wealth. Through its financial app, the company provides a financial playbook with playlists, curriculums, content and more.