Does the word fintech sound familiar? You have probably heard or read it recently in contexts such as: “The fintech ecosystem grows in Mexico and in the world” or “the number of fintech companies increases exponentially”, but first we must define…
What is a fintech company?
The term fintech is the clear result of the merger of two words: finance + technology. So, simplifiedly, companies that offer financial services accompanied by technology are called fintech.
The story has not been short. Starting with barter (9,000 BC) and the creation of coins (800 BC), through the credit card (1951 AD), online banking in the 90s and the formalization of the fintech concept in 2016, the financial industry has ceased to be a money exchange service to become a real ecosystem made up of segments such as: Payments and Remittances, Loans, Business and Personal Finance Management, Crowdfunding, Insurance, Wealth Management, Trading and Market Capital, among others.
So all banks are fintech?
Not necessarily. The objective of the companies that operate under this concept lies in the efficiency of their processes accompanied by digital solutions or through apps whose result is a more efficient, transparent and automated product for the user than those available in traditional companies.
The great technological development that we can find in this industry allows many of the participants not to need to have physical spaces, since 100% of their product or service, from the initial advice to the contracting and use of it, can be done remotely as is the case of us.
What services do Fintech companies offer?
- Loans
- Personal finance management.
- Investments.
- Crowdfunding
- Insurance
- Financial education
- Saving
- Markets and trading.
- Remittance.
How does a Fintech company work?
Fintech companies work through the internet or through applications, as they know it is a 100% digital service. The contract you acquire will be through email or other means of digital dissemination.
Although some fintech companies have physical offices, all payments or transactions you make on their page must be accredited by the Internet Mx Association.
How competitive are fintechs?
The savings generated by not having to have physical infrastructure to serve customers and the reduction of collaborators, subsidizing a large part of the activities with technology, not only generate more profitability for fintechs, but also give them the possibility of offering their products and services at a much more competitive price.
Borders are for countries. The fact that the operation and service is conditioned only to having a smartphone and internet and downloading an app, means that these companies can operate and expand quickly to more places.
Responding to the competition they face and the context in which they develop, fintechs are forced to offer total transparency in their service. The fintech user has to understand the added value they offer against their competitors from the first moment, or they will look for a second option.
