Financial technology, or Fintech, has had a massive impact on the economy, and fintech companies have become powerful drivers for financial freedom and inclusion, helping overcome traditional barriers. Traditional financial firms have always had barriers when trying to reach remote parts of India, leaving a large portion of the population unserved. Fintech companies have managed to overcome such problems with innovative solutions, reaching out to millions who had no access.
That said, fintech companies have the power to boost financial inclusions, and there are five key areas which have proved to be successful. Here are the top five drivers.
Easy access
What was the hurdle for traditional companies has been solved by fintech companies — ease of use and reach. With mobile applications and online platforms, people can perform a wide range of financial activities with ease.
Digital money
Digital payment methods have taken away the dependence on cash transactions, allowing them to pay a wide range of bills, carry out various transactions, and purchase anything with the use of smartphones.
Credit scores
The emergence of fintech companies has brought in alternate credit scoring standards based on transaction history, social media activity, and their online portfolio. People who were not eligible for credit opportunities with the traditional scoring system have now found a way to get loans and credit facilities.
Custom solutions
Tailor-made solutions are an interesting aspect of fintech companies, as they allow people to choose a customised solution that favours their financial goals, giving them a sense of control. Solutions can cater to the specific needs of individuals.
Beyond individuals
Companies are not only focused on individuals but also small businesses and startups. The ease of access, seamless payment methods, quick disbursal, and other aspects have empowered many entrepreneurs.