On July 7, 2021, the Federal Deposit Insurance Corporation (FDIC) organized Fintech: A Bridge to Economic Inclusion. In the conference, the FDIC Chairman Jelena McWilliams emphasized looking at financial innovation to solve issues like the high ‘unbanked rate’ among immigrants and minorities.
It’s no surprise that a congressional body now takes financial innovation in the banking sector seriously. It’s been the trend for quite a while now, with established banks also joining in the innovation drive, fostering more innovation and opportunities. In Europe, there are already some established Fintech banks like Fineco that operate primarily over the internet. Challenger banks, online banks, modern banks – whatever you want to call them, they are certainly doing something right to attract more customers through virtual doors! It’s no fluke that around 76 per cent of individuals used internet banking last year.
So, what is it really that the Fintech banks are doing so well? What does it look like? How can one do all the banking online? We try to explore all these below.
Accessible Anytime, Anywhere
The most significant advantage of so-called digital disruptor banks is that they are tailor-made for the digital economy. With almost everyone preferring to buy things online, people need a bank that is accessible whenever they please. Advanced financial banks do precisely that with powerful internet banking tools and mobile banking apps. As a result, you can carry the bank in your pocket with just a smartphone and an internet connection. Security isn’t an issue either, with most FIntech banking apps coming with fingerprint verification and two-step verifications.
No Branch, No Hassles
It is where things become unique; Fintech banks usually don’t have any branches. Their entire entity is online with perhaps an address to their headquarter. It doesn’t seem to be a problem for most age groups, as the online banking service is more than sufficient. You can open and close your account online and complete all the verification steps right from the app. It’s also effortless to send, receive, and transfer money, set up pay orders, pay bills, convert currencies, etc. And if you need some cash, you can always use the associated debt at the ATMs. So, if you think about it, having no branches means no hassles of travelling, queuing up, and so on.
Borderless and Global
In addition to taking full advantage of digital technologies, some Fintech banks like Fineco also offer some innovative features and services. For example, some banks offer a multi-currency account or currency conversion right in the app. The same bank or the other may also merge the current account and trading account into one, allowing people to trade and invest from one place. As they are made for e-commerce, selling and buying from worldwide markets isn’t a problem, either.
So, the bottom line is, Fintech banks look nothing like traditional banks. However, they are currently better at everything despite not having any physical branches. Indeed, they look like the future!