Fintech is the intersection between finance and technology. Fintech companies use innovative technologies to disrupt traditional financial services. These disruptive innovations allow for faster, cheaper, and easier ways to send money, pay bills, invest, save, borrow, and do many other things.
The term was first coined in 2012 by Gary White, CEO of TechCrunch. He defined it as “financial technology” or “fintech” as the combination of technology and finance.
In 2016, the Financial Times reported that the global fintech market had grown to $335 billion, and that the industry employed over 1 million people worldwide.
Fintech is a relatively young industry, but its roots go back to the early 1900s. In fact, the first ATM machine was invented in 1971. Today, we have mobile banking apps, online bill payment systems, peer-to-peer lending platforms, and even virtual reality tools.
There are three types of fintech startups:
• Payment processing companies
• Mobile app developers
• FinTech service providers
Payment Processing Companies
These companies provide software solutions for banks to accept payments. Examples of these companies include Square Inc., Stripe, and Braintree.
Mobile App Developers
Mobile applications are becoming increasingly popular among consumers. There are now hundreds of thousands of mobile apps available across different categories including games, social networking, shopping, and messaging
FinTech Service Providers
FinTech service providers offer financial products and services to individuals and businesses. They include credit card processors, stock brokers, investment firms, and mortgage lenders.