As a field, financial technology has become synonymous with new tools designed to make personal banking and investments more intuitive and user-friendly. These innovations are helping people manage their finances more effectively, but they also serve a critical purpose: enabling the broader population to have access to finance, particularly in emerging markets. This is true of products like Better Mortgage, which streamlines home loan processes, and GreenSky, which connects borrowers with banks, while democratizing the lending process.
While fintech has emerged more recently, the industry’s roots go back a long way. Some of the earliest advances in finance involved technological improvements that allowed people to move money more quickly over greater distances. For example, the first transatlantic cable and the Fedwire both helped establish a global network for transmitting financial data, in the same way that the Internet has done today.
The financial services sector has always sought to streamline its operations and cut costs by leveraging advancements in technology. This was true even before the advent of ATMs and credit cards, when a global telex network and advanced telecommunications systems enabled transactions to be transmitted over vast distances.
Today’s most well-funded and disruptive fintech startups are nimbler, and aim to challenge incumbent financial service providers by serving a segment of the population that was not being served, or by providing them with alternatives that they would not otherwise be able to access. Some of these startups are building a broad range of solutions, while others are focused on addressing one aspect of the finance ecosystem. Examples include robo-advisors, payment apps, and peer-to-peer (P2P) lending platforms. https://greyjournal.net/hustle/work-tech/navigating-the-new-challenges-for-fintech-startups-in-a-changing-economic-landscape/