Business, Fundamentals Friday December 4, 2020

What Is FinTech Application- A Complete Guide For Business Owners

Fintech is one of the most data-rich and innovative sectors today, that has created advanced solutions in the finance world. It has combined the latest technology with the financial sector to offer services to businesses, companies, and consumers.

Even though technology has always enhanced the financial sector, it has evolved significantly in the last decade. This article will guide you to understand this sector in the utmost depth for a new step in this evergreen field.

What is Fintech?

Fintech is a combination of the word “finance” and “technology”. Financial technology is the upcoming  technology, and this industry is encompassing technology in financial services. Fintech aims to build, improve, and automate the use of financial services to initiate better financial management.

Fintech processes with specialized software and algorithms that are using the internet and cloud services to connect with electronic devices to enable financial services. Many fintech applications are placed in function to provide an easy consumer’s payment platform for its business.

Fintech has penetrated various sectors and industries such as investment and trading, education portals, retail banking, Insurtech, eCommerce, etc. Fintech is the smart key to companies, businesses and consumers access better management of their financial operations.

What Is Fintech Application?

The fintech apps are offering the easy transfer, operation, and management of your business finances in varying sectors. In the post COVID world, when people want to minimize the physical interaction with increasing online services, fintech apps are playing a major role to manage your money without hassle.

Fintech apps are widely used in mobile banking, investment apps, mobile wallets, cryptocurrency, etc. to enable smart financial operations. Mobile banking apps like State bank anywhere, HDFC Bank Mobile Banking App, and many more are providing easy banking services to bank customers.

Investing Applications like Betterment, Stash, Acorns, etc are popularly used by investors. Payment Apps and Mobile e-wallets like PayTM, BHIM Axis Pay, PhonePe, Mobikwik are the essential apps of today’s generation. 

The latest technological advances are currently utilizing machine learning algorithms, blockchain, and data science to secure the entire process from credit risks to run hedge funds. Fintech application development is transforming the finance industry in many ways for the businesses, investors, and consumers at large.

Who Needs Fintech Application?

Fintech apps have become a part of everyone’s life, all of us have a fintech app on our phone for different purposes. As a business owner, having a customized fintech app for your clients can be an added feature to the growth of your business. Let’s see, which segments of the market need fintech application:

1. B2B (Business to Business)

If you are a business owner who deals with other businesses, the fintech app might fill your requirement. In the pre-fintech era, business owners would run to banks to and fro to get finance or loans for business. But now in the post-fintech period, you can easily get loans, financial services, and credit guidance through fintech.

Fintech service providers like the Customer relationship management platform also provide B2B business management for companies to benefit the maximum from the financial data to explore the market and provide quality services.

2. B2C (Business to Consumers):

If you are a business owner in the B2C segment of the market, fintech apps take you to new heights. The widely accepted fintech apps can be an appealing feature to your target clients or customer base.

These applications help customers to transfer money immediately on a real-time basis.

Also, today’s fast generation chooses online transactions over the physical handling of the expenses. Having a fintech app will give your business an edging point over your competitors.

What Are The Types Of Fintech Applications?

Fintech applications vary considerably in different sectors and projects. The fintech app can use machine learning algorithms, data science technologies, or blockchain technology to carry out functions. A fintech app not only affects the business module and products offered but also the way consumers manage their finances in your business.

Here is the list of types of fintech applications based on the domain:

1.Payments:

Payment companies have changed the payment game with fast and efficient digital solutions upgrading every day. Sending money online anywhere in the world is just a few clicks away with wide connectivity, low processing costs, and ensure safety. These payment companies offer services like processing online payment transactions, finance management, and account details.

2. Mobile payments:

Digitalization has made every consumer with a smartphone use some form of mobile payments app for quick daily payment. The increasingly sophisticated technology has brought numerous app services that have emerged convenient for consumers to exchange money and pay online through their smartphones.

Mobile wallets offer integrated payment solutions to consumers and businesses for safe transactions. Some of the most popular e-wallets are Google Pay, Amazon Pay, and Apple Pay.

3. Net banking:

All major banking and financial institutions have functional net banking options for their consumers to improve user experience. Every significant banking Institution today holds a mobile application that offers accessible banking solutions to account holders. These fintech apps help to reduce the banking hassle, infra costs, and the friction in receiving the service.

4. Blockchain and Cryptocurrency:

Cryptocurrency and blockchain are remarkable fintech growth examples.  Cryptocurrency is the latest form of digital currency getting famous with Bitcoin and litecoin. Even though it has plenty of controversies around safety and legality, Blockchain stands firm to back up the security and tracking concerns of the currency.

Blockchain contributes to peer-peer transactions, smart contracts, trading platforms, and data records. This cutting-edge technology solution offers a transparent method of tracking to gain the trust of investors.

5. Insurance Technology (InsurTech):

Insurtech has become the new sector in the industry, including every insurance right from car insurance to life insurance. Insurance companies are automating the entire processes of insurance to increase the market coverage of the companies. Fintech apps provide smart maintenance of insurance policies using smartphones and artificial intelligence to enjoy better services.

Fintech helps customers with every month’s  financial updates to experience uninterrupted EMIs for policy. Fintech is changing the way insurance companies work and offer services to customers by added features such as assistance from home, personalized service, and huge offers in the competitive market.

6. Lending

Fintech is taking the credit system with a blink by streamlining risk assessment, fast-forwarding the approval processes, and making money borrowing smooth and transparent. Consumers can now apply for a loan in the lending company from their personal devices.

Consumers get credit/account reports whenever they wish without hampering the credit score. This makes the lending system and companies transparent for the consumers. Fintech helps to manage assets, borrower’s records, and track collateral value.

7. Stock Trading

Fintech has also influenced the trading sector considerably. The fintech applications help reduce the cost of international trade for domestic traders. It also increases transparency in trading worldwide and facilitates a smooth platform for trade finance. These apps support cross-border trading with IT systems and smart distribution platforms for all.

What Are The Benefits Of Fintech Apps?

 Using a Fintech app for your payments, transactions, and money management over cash and physical infra is always a better option. Fintech can benefit the consumers in multiple ways. Let’s explore all the possible benefits that come of fintech app:

Faster Approvals and convenient services:

With the ever-increasing number of consumers using smartphones, FinTech businesses are aligning their processes to provide a smooth customer experience. It enables users to manage their finances from the convenience of home using smartphones and other personal devices. FinTech offers great accessibility and speeds up the approval process through automation by reducing it to 24 hours.

More Personalized Services:

Fintech apps react more easily with the individual needs of consumers with access to quick information. Business build fintech apps using data analytics solutions that allow easy capture of information like address, balance, amount details, and payment history. This makes the customer experience completely personalized.

Advanced Security:

The rapid evolution of mobile technology brings dozens of new models every month in the market, this has compelled the Fintech business to invest more in the security domain to ensure consumer data safety. The most trusted security option used nowadays include biometric data and end to end encryption.

These features give access to the user accounts with authentication via OTP or password exclusively synced within the app ad user information. The safety practices in fintech give users the confidence that their critical information and money are in secured accounts.

Lower Costs:

FinTech firms enjoy lower operating costs because of no brick-and-mortar infra such as rent, furniture, salaries, and maintenance. With this adaptation, Fintech companies can pass on this advantage to consumers through lower premiums fees. These companies invest money in their clients and product development to get an edge in the market.

Concluding remark:

Fintech is one of the most essential technologies today for it’s precise solutions to the finance sector. If you are a business owner in a B2B or B2C segment, fintech application might sound like an obvious choice now. But make sure your fintech app offers your customers a reliable and trustworthy platform to take leverage in your business. Keep reading this space to get more insights into everything you need to know in finance and technology around the globe.

Let's talk about your app

Hi, I am Sunil. Do you have any questions?
Feel free to get in touch