Financial technology, also called FinTech, is a line of business based on using software to provide financial services. Monetary technology businesses are generally startups founded with the purpose of disturbing traditional corporations and incumbent monetary systems that rely less on applications.
‘Fintech’ is the newest lingo being banded about in technology groups and tossed about through much of the media. Yet it’s a word, or definition perhaps, many – even technology understanding and savvy entrepreneurs – do not fully have a handle on, despite the saying being in vogue.
It’s been about two decades since the world was actually changed by a fiscal company known as Paypal, but the winds of change are blowing once again.
Historically viewed as an extremely technical, highly controlled sector dominated by behemoth banks that resist disturbance–other than the occasional world-wide collapse–finance is driving an entrepreneurial wave. Demand for upstarts’ services is high, fueled by longtime frustration with huge banks; and the supply is only gaining, bred largely due to fiscal sorts yearning to do something other than continue the endless dance for domination inside yesterday’s super companies.
International investment in financial technology more than tripled to $4 billion from $930 million in 2013. Forty percent of London’s work force is employed in technology and financial services.
Also, the affiliated reworking of monetary regulations, customer behavior and new inventions, means this amount will continue its sudden rise in the upcoming years. Such is the impact technology has on finance. Longterm finance junkie cities like London desperately seek the latest tech and talent to ensure they stay competitive.
In Europe, $1.5 billion was invested in financial technology companies in 2014, with London-based companies receiving $539 million, Amsterdam-based businesses $306 million, and Stockholm-based companies receiving $266 million in investment.
In may not be as dramatic as a host of cybernetic terminators rising from the ashes to conquer the world, but the arrival of fintech will, nay, already has made a lasting impact on the way business is done. The traditional model of a brand new company turning straight to its local high street bank or conventional investor is no longer the only game in town.