Fintech is all about digitising the financial industry. This includes mobile applications that let you do banking and investing from your own sofa, or being able to pay at the checkout with a smart watch. Fintech combines the financial industry and information technology, and its own team of specialists has emerged at the crossroads.
In the world of fintech, there is a lot of hype surrounding revolutions and disruptions. However, it’s important to remember that not everyone benefits from these changes. In Prasad’s book, The Future of Money, How the Digital Revolution is Transforming Currencies and Finance, he mentions the words »revolution» and »disruption» dozens of times, but never specifies who or what is being disrupted.
The financial industry is changing rapidly, with new startups like Lending Club and Robinhood challenging the status quo. These companies are innovating and creating a new brave world for the economy. This change is complex and difficult to understand, but it is happening nonetheless.
In the past, central banks have been the most mysterious and inaccessible institutions in the economy. They have been shrouded in secrecy, and their inner workings were known only to a select few. But now, as central banks begin to digitize money themselves, we are getting a glimpse into their world.
For example, bank accounts, debit cards and mortgages are still very much around, and fintech is making these products and services even better. For example, you can now get a mortgage without having to go through a bank. However, contrary to what some may believe, fintech is not a revolution. It’s simply a more efficient way of doing things – and this is why it’s becoming so popular. At the same time, cash is becoming less and less needed on a daily basis, so the confluence of technology and the deep changes we see in our use of forms of money like coins and notes will inevitably result in a new paradigm of money. What new features money will have when combined with technology still remains to be seen.