If you’ve ever had to deal with banks, you know how frustrating it can get. Banks charge you exorbitant fees for payments, they require documents upon documents to open your account and demand excessive securities when you need a loan. Traditional banks have always had a take it or leave it attitude, knowing that customers have very little choice. This dated reality, however, is no longer true.
For years now, technology companies have entered the lucrative financial market. These so-called, Fintech companies have brought with them a revolution in the sector, which no traditional bank could have ever imagined. They made it possible to manage your daily business finances from your mobile phone, and even allow you to invest in seconds. These companies studied the market and found ways to improve it. Most traditional banks did not act, and fell behind, losing valuable customers and income.
Better service, lower fees.
You might be surprised to learn just how human intensive many of the traditional bank’s processes are. From processing payments to verifying account holder details, these processes cost the banks heavily. Naturally, these fees need to be provided for, and the only option for the bank is to charge them to the client.
Many Fintech companies, such as Revolut and myPOS, operate differently. They utilise technology and automation to simplify each process, whilst ensuring compliance with international financial regulations. The result is simple; processes flow much quicker and cost considerably less. Thanks for Fintech companies, businesses can offer more convenient services, such as accepting card payments, whilst paying lower fees.
The future of banking.
Tens of thousands of people in Europe, the United States and all over the world are embracing Fintech companies. Businesses and individuals are fed up and angered by the way banks operate. They act as though they are a nation’s institution, when, in fact, they are a business, out to make money. Surprisingly, even with such growth in new accounts of these new-age companies, bank’s attitudes remain unchanged.
It is always difficult to predict the future of any industry, especially one which is evolving so quickly as Fintech. Blockchain, cryptocurrency, cashless payments and legislation will have an impact. What could be said, with some degree of certainty, is that Fintech companies will remain at the forefront of innovation, providing customers with new, convenient and practical solutions to their needs.
In the meantime one can also speculate that traditional banks will remain relatively the same, believing that they are sheltered from Fintech companies because they offer loans, mortgages and trade finance. Unfortunately for them, Fintech companies, such as Mintos and Bondora are already registering growth in providing these services.