How Investors See the Value of Fintech?

September 9, 2020

Fintech is a radical evolution of the financial services industry. Over the last decade, venture capital skyrocketed and the share of investment dollars going into fintech increased from 5% to nearly 20%.This high rapid growth in recent years, driven by a combination of four main Drivers:

Technological Evolution:

Fintechs are ideally placed to take advantage of opportunities arising during technological evolution.

Changing Customer Expectations:

Solutions that have the potential to impact the customer experience, such as predictive analytics, are particularly well-positioned for future growth”.

Regulatory Support:

Support from the governments and regulators may lower barriers to entry into services within the financial services industry

Availability of Funding:

Easier access to funding and capital enables entrepreneurs to start new ventures in new products and business modelsGlobal fintech saw 838 deals worth $15.1B in H1’19 and 1,895 deals worth $40.5B in 2018.So, How does fintech help to address key issues:

1. Improving financial inclusion:

Fintechs enable the provision of new products and services to customer groups who haven’t been able to access traditional financial services.

2. Enhancing customer experience:

Fintechs can offer personalized services and communicate interactively with customers.

3. Increasing transparency:

Fintechs enable financial services companies to increase the clarity of services and products and provide transparency on fees and charges.

4. Improving security and compliance:

There is multiple fintech that helps businesses to detect fraud and manage risks and compliance issues.

5. Providing support and guidance:

Fintechs, through the use of technologies such as (AI) and big data analytics, provide tailored customer support and guidance in a cost-efficient way.The fintech has had its start. The banks and financial institutions are catching up, though many have lost the battle without even knowing it. The tech companies are taking a hard turn into finance, directing their millions of website visitors to partners and vendors.It’s more and more dependent on the customer behavior that will ultimately determine who wins!Reference:

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