Financial technology, often referred to as FinTech, is the marriage between financial and technology services. The FinTech offering seeks to provide innovative alternatives to traditional methods in the delivery of financial services.
The different categories that sit within the ambit of the broader FinTech offering include: lending, payments, wealth management and personal finance, digital currencies and blockchain, and banking.
Within each of these categories, FinTech companies can improve a product or service by either making it cheaper and easier to use, and/or by making it available to more people – thus ‘disrupting’ already established financial institutions, from the perspectives of both cost and product offering (FinTech companies are providing new types of services, and are able to appeal to previously untapped markets).
The inherent efficiencies of FinTech are evidenced by industry projections that the global FinTech market will be worth USD 305.7 billion by 2023. On the local front, a recent EY report projects South Africa’s FinTech adoption rate as above the global average. This dramatic growth of the FinTech offering has highlighted the need for companies looking to utilise these technical innovations to be aware of the complex and rapidly changing legal and regulatory landscape. Contact our regulatory team for help with your FinTech questions.