The Implications of FinTech for the Banking and Financial Sectors
FinTech is an innovative development in the banking and finance sectors. Technology has disrupted the manner in which established organizations in the industry currently provide their clients with goods and services. To survive in this environment, businesses should adopt the new trend strategically by taking some of the suggested actions, such as waiting it out, acquiring FinTech companies, investing in IT infrastructure, and forming alliances with startups that have adopted the new model. In order for businesses to reap the benefits of the unique working environment, it is necessary for them to conduct extensive research into the various available solutions.
Situational Summary and Introduction
FinTech is a company in the financial technology sector that is disrupting “mobile payments, money transfers, lending, fundraising, and even asset management” Utilizing technological applications to provide services is technology. Numerous observers believe that FinTech emerged around 2005 in the first decade of the twenty-first century, despite the fact that the exact date is unknown. TextPayMe is said to have been the first company to use the mechanism that enabled SMS payments. After Amazon’s 2006 acquisition of the sector, the stage was set for its transformation. The primary market participants are technology companies, large financial institutions that will benefit from IT infrastructures, and end users who have become institutions due to self-service applications. FinTech’s growth has been aided by a number of factors, including the expansion of IT infrastructure, data-driven payments, and client readiness to adopt the trend. Premises and Methods
The banking industry has already utilized FinTech to improve customer service. One of the strategies utilized is historical M&A, which reveals the sector’s potential and trajectory. The method is defined by startup technology businesses that offer financial services. Banks can retain their services by employing the technical infrastructure in inventive ways to meet customer requirements (Mearian, 2017).