The term “fintech” has become a buzzword over the last five or so years, but in the space of that time, it has come to mean a substantially different aspect of modern banking and finance.

At the start of the last decade, there was a significant movement of banking innovation involving computer technology and internet access. Talk then of fintech was concentrated on how established financial institutions could become “leaner and meaner” by sharpening their operations through technology.

So, in the early phase, “fintech” mainly referred to the development of new back-end systems for account management in established financial institutions. ​Now, however, it is concerned with a shift to customer-oriented services in retail banking, investment management and B2C payment channels connected to e-commerce.

Along with the established moves into fintech, 2020 has seen a dynamic acceleration worldwide both in the volume of business being conducted through fintech markets and in the scope and range of the services that consumers and businesses demand. People confined mainly to their homes now rely on technology to meet all money-management needs.

Why fintech became associated with startups

The legacy banking sector was essentially caught by surprise by the speed and size of the switch into fintech by the general public. A stumbling block for established banks has been the limiting factor in their ability to innovate due to the demand from the central authorities for compliance to old-fashioned lending rules. This actively prevents banks from supporting the innovations and has enabled nimbler fintech firms to get ahead of the more regulated opposition. Banks can’t compete in the newer segments due to the heavier capital requirements placed on them than the lighter regulation applied to fintech startups.

This multitude of startups has been able to boost their positions in the finance industry by provisioning more comprehensive financial inclusion and using technology to minimize their operational costs.

Some of the key features of modern fintech are:


The COVID-19 pandemic supercharged the already substantial percentage of retail business that was being conducted through online channels such as Amazon and Google, changing online shopping forever. E-commerce solutions provided by fintech services have to supply both the wide range of different payment solutions that buyers demand with the efficient and secure channels that business requires.

Investment and savings

Safe and secure savings are the traditional offerings of the conventional banking sector. Still, with the dramatic fall-off in interest rates, the ordinary savings deposit account has mainly become redundant other than for short-term liquidity funds. Longer-term investment now requires sophisticated management plans, and fintech funds management has become a significant attractor of business. This is visible across the whole spectrum, where fintech plays a vital role in the financial decisions of emerging investors while also establishing itself as a popular choice for affluent consumers.

Mobile payment networks

Mobile payment networks such as Tenpay in China and Kenya’s M-Pesa have overtaken cash at all levels of society. The “challenger banks”, like Monzo, Revolut, and N26, have become the preferred choice for people in Europe. Recent surveys found that eight out of ten Europeans used some form of prepaid digital debit cards.

The flexibility and speed of prepaid debit card services mean consumers can purchase any mobile armed with a SIM card and start paying with it instantly, simply topping up the balance with a few simple steps in a few seconds. These models give users a high degree of control over their spending.

Artificial intelligence and machine learning drive marketing

The vast amount of data that flows along with online banking, financial transactions and e-commerce give fintech operators a pool of information ideal for building accurate and flexible marketing strategies. Broadcast advertising is now a thing of the past, since AI permits the fintech institution’s marketing department to build and direct campaigns that deliver the appropriate message to the right people directly.


Fintech is now an established part of global commerce and banking. The pandemic has dramatically strengthened its grip on the markets, and the startups that have established a foothold will retain a lead over legacy banking operations for many years. In our view, there are still many opportunities for expansion and growth for niche players who can fill in the gaps that the great demand for new services offers, which older players and legacy banks are unable to fulfill. Advice on this and all other aspects of financial technology banking is available.

How is fintech associated with e-commerce?
The global e-commerce marketplace has been strongly affected by fintech. With the help of fintech service providers, e-commerce vendors can now offer facilities for digital payments and refunds to their customers around the world.

What is the meaning of financial technology?
Financial technology (fintech) describes the use of new digital technology to automate and improve the use of financial services. In the early decade of this century, the term fintech was mostly referring to the computer technology applied in the back-office systems of the legacy financial institutions – mainly banks and building societies. Now, the term covers the whole range of digital financial transactions, including wireless money transfers, debit cards, mobile phone apps and much more.

How does fintech affect e-commerce?
e-Commerce focuses on remote access transactions through digital user interfaces. The key feature is for fast, secure and affordable funds management. This makes it easier for e-commerce traders to handle a wide variety of payment media, with multiple service providers both on the demand side and through to their supply chain partners

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