You may have heard the relatively new term FinTech bandied about, but what actually is it? And why is it important for all entrepreneurs to know about and understand?
The definition of Fintech
The term "Fintech" stands for Financial Technology which is better understood as providing financial services by making use of software and modern technology. It was initially applied to consumer trade— financial institutions. By the end of the first decade of 21st century, the term applies to any technological innovation in the financial sector.
The Wikipedia definition for financial technology is pretty daunting, and states global investment for fintech has increased from $930 million in 2008 to $12 billion in 2014. It even mentions Bitcoin and startups like Lending Club, TransferWise, Prosper, Affirm and Wealthfront.
It used to be that if you wanted to start a business, you would go to your local bank to ask for a loan or seek out a traditional investor. If a company wanted to accept credit cards, it would need an account with a big credit provider — not to mention a land line and bulky equipment. But this is no longer the case.
FinTech like crowdfunding, mobile payments, and money transfer services is revolutionizing the way small businesses start up, accept payments, and go global, and they are making it easier than ever to start and run a business.
This post is a curation of multile posts published on different websites. I do not own the original content.