There’s no doubt that Fintech is helping banks thrive. In this blog post, Traderoot Africa explores the effect of Fintech on the banking industry as a whole.
While Fintech is often regarded as one of the largest threats to the traditional banking world, this is not the case. Fintech should be viewed as a partner and not a competitor or challenger of traditional banks. Here’s how Fintech is helping banks thrive:
Democratising Access to Financial Services
There is still a large portion of the world that lacks access to financial services. For example, more than 13 million adult EU citizens still lack access to formal financial services. Fintech is helping provide the unbanked population of the world with access to financial services. Thus, Fintech is helping to create a larger market by providing access to banking and other financial services.
Reducing Costs and Increasing Revenue
Banks are always looking for anything that can help them reduce costs and increase their revenue. A bank’s profit margins need to be increased in the near future if the bank wants to sustain its growth. It will be difficult for banks to boost revenues in the current economic environment, so they need to reduce their costs. Many banks are successfully leveraging off of Fintechs by licensing certain software. This approach tends to drastically reduce operating costs while increasing revenue.
“Traditional banks can benefit from implementing Fintech solutions. At Traderoot, we partner with banks and other financial service providers to help them increase their profitability through our Fintech solutions,” says Daniel Templeman, Director at Traderoot.
The team at Traderoot are experts at designing, licensing and implementing new and complex solutions for both existing financial institutions and new Fintech participants.
Increased Transaction Speed
Increased transaction speed is one of the greatest benefits that come with Fintech. Fintech can dramatically increase both the efficiency and the speed of transactions. Blockchain-based payments for example, can be processed in a matter of seconds. Through the use of blockchain tech, payments are set to be secure, low cost and overall this technology allows money transfers to be facilitated regardless of the distance between the sender and receiver, meaning cross-border payments can be processed in a matter of seconds.
Beyond the things mentioned above, Fintech is helping incumbents remain relevant and compete with the emerging challengers.
Fintechs help banks implement simple payments through digital wallets, payment applications, or online banking by establishing connections with critical consumer bases. Fintech not only helps improve the overall consumer experience, but Fintech also enables banks to provide consumers with convenient purchasing options. Buy Now Pay Later (BNPL) services are the perfect example. Consumers without a credit card can use BNPL services
Traderoot is Your Fintech Partner
Is your financial institution looking for a trusted partner to facilitate your innovation efforts?
At Traderoot, we provide advanced Fintech payment and issuing solutions to payment service providers and issuers in the banking industry. The team at Traderoot is here to help with all your innovation efforts.
Take a look at our solutions to learn more about our service offering or email us on email@example.com.