FinTech and its impact on Global Financial Services | MBA Colleges in Bangalore

Posted by Dr.Samiya Mubeen On 13/02/2023 10:44:31

The term “FinTech” is a contraction of the words “finance” and “technology”. It refers to the technology start-ups that are emerging to challenge traditional banking and financial players and covers an array of services, from crowdfunding platforms and mobile payment solutions to online portfolio management tools and international money transfers.

FinTech has the potential to fundamentally transform the financial landscape, provide consumers with a greater variety of financial products at competitive prices, and help financial institutions become more efficient. The rapid and transformational changes brought on by FinTech need to be monitored and evaluated so that regulators and society can keep up with the underlying technological and entrepreneurial flux. best mba colleges in bangalore

A simple categorization of some of the most prominent FinTech innovations into groups according to the areas of financial market activities where they are most likely to be applied is as under: bangalore mba top colleges

Major FinTech Innovations

  • Payments, Clearing & Settlement
  • Deposits, Lending & capital raising
  • Market provisioning
  • Investment management
  • Data Analytics & Risk Management

Innovation and technology have brought about a radical change in traditional financial services. Technological innovations compel banks to modify their way of doing business and earnings models. Banks currently perform activities in several market segments, viz., payments services, raising deposits, lending, and investments, etc.

where technological innovations will result in more high-grade products at lower prices. If banks do not adopt them quick enough, innovation by rivals may put their business. A++ Rated MBA college in Bangalore

models under pressure. Loss of consumer contact and fragmentation of the value chain  could then diminish banks’ ability to profit from the cross-selling market. Global Technology players, viz., Apple, Google and Facebook that adopt innovations effectively and carry technological innovation and new services across the financial value chains. These companies displace existing financial institutions by exploiting their scale and innovative capacity. mba in hr bangalore

Technological innovation brings opportunities and risks. FinTech can increase efficiency and diversity by boosting competition within the financial sector. This effect will reduce market concentration and may lead to better services for consumers, in particular as new technological processes often result in greater user-friendliness. This is in particular relevant for the Indian banking sector. Moreover, innovative new entrants provide an incentive for established financial institutions to become more competitive and focus more on their customers. mba in business analytics bangalore

A more diverse financial sector also reduces systemic risk by increasing the heterogeneity between the risk profiles of market participants. In addition to creating new opportunities, FinTech also carries potential risks for the financial sector. These include

risks to the profitability of incumbent market players as well as risks related to cyberattacks. 

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