Fintech Financial Technology Answer 2022

Answer to Question 1
Fintech has been derived from the word financial technology. This technology innovation has
been designed to provide or support the financial services. This technology is showing a rapid
growth in the financial sector by innovating range of new business applications, processes and
models. Every financial service provider is dependent on technology but the fintech firms give a
huge importance to the technology friven innovations and consider it to be an integral part of the
business operations that are carried out. This technology helps in promoting automated use and
delivery of the financial services (Bruner, Eades and Schill, 2017). Fintech has not only helped
the companies but also the consumers and business owners to manage the business operations
more smoothly and efficiently by using algorithms along with certain specialised software. These
algorithms can be used with the help of computers as well as mobile phones.
Initially when fintech was introduced in 21st century, this term was used for the financial
institutions that utilised this technology at the back end systems. Presently, it has been observed
that there is a shift towards the consumers and it has obtained a definition that is oriented to the
consumers. There are various fields in which fintech have been adopted such as retail banking,
education, investment management and also fundraising. It has also encouraged the development
of crypto currencies like Bitcoin (Hassani, 2016). The fundings of fintech is at the rise but it is
facing certain problems because of the huge regulatory burden that it is facing.
Answer to point 5.
It has been observed that since the emergence of fintech the traditional financial service
providers are facing many challenges. They are also trying to transform the business models. It is
too early to determine the changes that would be seen because of the adoption of fintech. There
are many new fintech firms that are entering the market and are operating as start ups. There are
many traditional banks which have started making investments in financial innovation and have
also started setting up certain units in relation to fintech within the company. It is expected that
there will be a fall in revenue of banks by 10%-40% by the year 2025 and the main reason for it
will be fintech (Khan and Jain, 2014).
There are few changes in the services provided by the financial institutions. Some of the services
that are provided includes –