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As the world's connectivity has improved and technology has become cheaper and more advanced, the emergence of "fintech" was bound to happen. This technology has made financial management cheaper and less time-consuming, improving the lives of millions.
But what exactly is fintech, and how does it work? We'll explore that question and break down fintech's benefits and drawbacks. Fintech is likely here to stay, which means we should understand exactly what it is and how it will change the financial landscape going forward.
"Fintech" is a blend of the words "financial" and "technology." As this combination suggests, fintech refers to using digital tools, software, or technology to manage financials or make transactions. Fintech can take many forms in the real world, including everything from mobile banking to peer-to-peer (P2P) payments to cryptocurrency.
Fintech allows customers to quickly log in to their accounts, often supporting biometric logins on their mobile apps. To keep customer accounts safe, fintech companies typically support strong security measures like 256-bit encryption and two-factor authentication (2FA).