Fintech

FinTech Banking: The Ultimate Collaboration for Better Future of Banking

FinTech banking can be a solution to difficulties associated with traditional banking methods. FinTech banking companies are those companies who make use of the latest technology in the best ways to help banking sectors grow and flourish. In this blog, we will let you know all the details about FinTech banking, and why is it necessary for today’s world?

What Is FinTech Banking?

FinTech banking companies are companies that make use of technologies to do banking. Unlike traditional banks, they have technology backing them. Therefore they are more successful than other banks using the old ways of banking. They use and develop various techniques that make things easy for the bankers and also for their customers.

What Are FinTech Companies?

FinTech companies are companies that provide financial, technical assistance to other companies. Also, they are known as innovative technologies used to improve traditional business methods and to develop effective methods and solutions for financial institutions. The examples of development in financial technologies are banking software and mobile banking applications.

Top 10 FinTech Banking Companies in India

India has the second-largest number of financial technologies companies {FinTech companies}. India has over 2000 FinTech startups, and 42 per cent of them are situated in Bangalore, and Mumbai others are present in New Delhi, Gurugram and Hyderabad. Until 2018 730 functional FinTech companies get bigger from the year 2015-2018 and 1300 more FinTech startups were added in the Indian FinTech organizations.  The top 10 FinTech companies in India are;

1. Mobikwik: a digital wallet service that allows our mobile phones to make bill payments, phone recharges, and do online shopping
2. Policy Bazaar: is a portal which brings neutral comparison of financial services of leading insurance firms
3. Paytm: is a payment gateway specially made for mobile shoppers in India
4. PhonePe: is an app that is used to transfer money online
5. Kissht: is a lending platform that offers a personal platform to purchase kitchen appliances, electronic gadgets, furniture, etc.
6. Subh Loans: is a Mobile Money Lending company which makes loans accessible to underserved and un-served
7. wonderland Hubs: is a platform that provides credit gateway solution to the new-to-credit public and Suburbans that they can enable zero-friction credit assessment
8. Bank Bazaar: is a digital financial product trading post for getting insurance products and instant customized rate quotes on loans
9. Paisa Bazaar: is a virtual market place for obtaining a  credit card, a loan, and more investment products in India
10. Pay Sense: is a FinTech startup that provides loans and credit options in the range from Rs. 5000-Rs 1 lakh using the web or mobile platform

Benefits of FinTech Banking Industry

Here are a few advantages of FinTech Banking Industry for the current Indian market;

• These services allow online services to match lenders with borrowers irrespective of whether they are individuals or organizational bodies.
• FinTech banking companies allow users businesses/individual users to accept payment on their mobile phones even when they don’t have a merchant account.
• These services mainly focus on providing personal/customized financial advice and services to individuals
• These companies make more comfortable taking loans and other credits for companies and individuals
• Indian market is still biased and prefers traditional ways of making transactions. Introduction of FinTech Banking can allure them in using the services provided by FinTech Banking companies and upgrade themselves

Scope of Growth for FinTech Banking Companies in India

FinTech companies work to refine the ways companies and other consumers do transactions daily. As now the FinTech industry is growing and proving to be beneficial people and industries are getting more and more interested in investing in them. The investments in FinTech companies have been increasing rapidly from the year 2013 to 2015. India, the scale of the growth, is smaller but is similar. The percentage of growth of the FinTech industry in India is 282% from the year 2013 to 2015.

And with the growth in other types of businesses making more investments in FinTech companies, banking sectors are also getting interested in them to digitalize their services.

Services that FinTech Banking Companies Provide

FinTech banking companies provide service offerings to help companies emerge on a digital platform. These fundamental services are;

• Peer -to- peer {P2P} lending services: These services allow online services to match lenders with borrowers irrespective of whether they are individuals or organizational bodies. They make use of alternative credit models that provide consumers with faster and easier access to capital.
• Payment services: FinTech banking companies allow individuals or businesses to accept payment on their mobile phones, even without having a merchant account. Famous examples are Paytm, Mobikwik, etc.
• Remittance services: FinTech services have made making inbound and outbound remittance easier and cheaper. Examples of companies providing remittance services in India are Instarem, Remitly, and FX
• Retail investment services/Personal Finance: These services mainly focus on giving personal/customized financial advice and services to individuals. Examples include Scriptbox, PolicyBazaar, BankBazaar, etc.
• Different software services: These services work to improve access to financial products by offering various cloud computing and technology solutions. It helps increase efficiency in day to day business operations.
• Equity funding services: This service includes crowdfunding platforms to enable funding of business projects by raising funds from the general public.
• Cryptocurrency: These services provide digital financial currency like “Bitcoin.”

Also Read: How FinTech Companies Help Startups to Grow?

Traditional Banking Methods

Traditional banks make most of their income in these two ways;

• Free income up to 35% and,
• Interest Income up to 65%

Traditional banks earn 35% of their income in the form of Fee Income. They levy service fees on account services, transaction charges, insufficient fund charges, and other charges to make emolument.

And they earn 65% of their income in the form of interest income. Banks allow liquidity, credit, and capital risk to make profits.

How FinTech Banking Help Traditional Banks

The FinTech banking organizations can help extant traditional banks in these ways/manners;

• FinTech companies have restructured the way banks operate and provide loans
• These firms now have redesigned the mode of payment. Payments made using the online platforms are more secure, faster and now are easily accessible.
• With the introduction of FinTech people have shifted their attention and changed the way of saving managing assets, and investing in capital
• FinTech services have made making inbound and outbound remittance easier and affordable
• Furthermore, providing insurance is also something that FinTech companies do with a less complicated procedure

To Conclude

FinTech companies are growing and providing services to other crucial industries. They use various technologies to help these industries grow. FinTech companies also work in providing services to individuals. They provide services to multiple businesses like NBFCs, companies, banks, and even to individuals.

They can help grow the economy of our country and bring solutions for all like never before. Moreover, FinTech in banking can transform traditional ways into better, faster, and secure means of banking online with the comfort of your home.

Our Latest Blogs: SIDBI Launched Pilot Scheme for FinTech NBFCs to Promote Digital Lending

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