If you were measuring its recent cultural cachet, you would have to assume that FinTech is a relatively new addition to the financial world. In reality, it’s as old as the abacuses your great-great-grandfathers used to keep count of their sums. A portmanteau of Financial and Technology, FinTech represents any kind of tech used to simplify banking systems. That’s a pretty broad definition, and like any technology, it’s gone through a long and varied evolution to get to the point where it is today. Now, it’s not just a back-end support processing transactions but a front-facing service uprooting traditional bank services.
Positioned as an innovative alternative to the world’s biggest banks, FinTech forms a new way to manage your money online. Good things could come out of embracing change in your banking habits. Here are some of the advantages to banking with FinTech alternatives.
You can blame size for the biggest bank’s lethargic pace. Slow to innovate, these organizations aren’t updating their systems to allow for the fastest service possible. Complex bureaucratic hurdles join this outdated banking model, making traditional banking a slow-moving entity.
Compared to conventional banking services, FinTech alternatives work at lightning speeds. Mobile banks like Chime fast-tracks your paycheck with direct deposits and instant peer-to-peer transfers. Online lenders like MoneyKey offer quick online payday loans that you can secure in just one business day when you use their online loan app. Both offer you real-time updates, so you can check in on your checking account or cash advance balance at any time.
Convenience and speed go hand-in-hand. The reason why FinTech can offer such responsive services is also why they provide convenient banking opportunities. By virtue of being online, they’ve removed all of the physical barriers that can prevent people from banking as often as they like. Those who live far away from a city center don’t have to travel just to perform daily banking tasks. Instead, they can do it anywhere they have access to WiFi.
They’ve also done away with business hours. Online platforms can process requests at any time of the day or night, making FinTech banking alternatives more convenient for those people who work odd hours.
Expectations of speed, convenience, and efficiency converge in a new kind of customer service—one that’s more responsive and personalized than ever before. As the FinTech industry grows, it becomes increasingly customer-facing. Customer-first services mean they’re offering a better overall experience than traditional banking.
FinTech companies are doing that by being transparent with their services and engaging their customers with a focus on shared value creation. In other words, they’re upfront with how their services will serve both sides of the screen by explaining terms, fees, data permissions, and other facets of their services.
Right now, FinTech companies are at the helm of this new movement of mobile banking services offering speed, convenience, and customer service. But soon, these features will bleed over into the traditional banking model. The biggest banks are already partnering with FinTech start-ups to innovate their old-fashioned services. Until every branch embraces these newer services, you’ll have access to them through mobile FinTech companies.