Financial technology (Fintech) is used to describe new technology that seeks to improve and automate the delivery and use of financial services. At its core, Fintech is utilized to help companies, business owners, and consumers better manage their financial operations, processes, and lives by utilizing specialized software and algorithms that are used on computers and, increasingly, smartphones. The possibility now looms that entities driven by Fintech may emerge as competitive alternatives to traditional financial intermediaries, markets, and infrastructures.
Historical of Fintech
FINTECH 1.0
Fintech history dates to the 19th century and even before that. In 1860, a device called PENTELEGRAPH was developed to verify signatures by banks. Historians accept 1866 as the first valid Fintech footprint. This was the year the transatlantic cables were set up leading to an era of creating network infrastructure and linkages around the world. The letting up of electronic fund transfer through Telegraph & Morse code in 1918 by Fedwire led to the first baby step in the digitalization of money.
FINTECH 2.0
Fintech 2.0 is considered, to begin with, the introduction of ATMs by Barclays in 1967. Just the year before in 1966, Telex had replaced Telegraph for transferring information across the world; thus heralding an era of connected financial transactions and communication. The major fintech growth came in 1971 with the setup of NASDAQ as the first electronic stock market. It changed the way bidding is done and modernized the Initial Public Offering (IPO) process significantly. This is considered one of the most important Fintech developments of all time.
FINTECH 3.0
The 2008 crisis led to the following requirements among others: First, post-crisis reforms required stricter regulatory compulsions for traditional banks, and it opened up a new market for smaller players. This was further helped by the mistrust of the public in large financial institutions. Second, the overall focus of the industry was on cutting down operational costs using technology.
FINTECH 3.5
The year 2014 onwards saw a non-linear rise of the two most populous countries in Fintech, namely China and India. Devoid of large chains of complex physical banking infrastructures, these two countries saw a very fast-paced growth in the Fintech sector.
Historical of Payment System
Barter: Dating back to before 7000 BC, Barter is the exchange of material goods or services for other goods or services.
Coins: The emergence of coins made of precious metals appeared in approximately 680 to 560 BC. The circular shape was adopted as being the most practical.
Paper money and banknotes: Their function was to replace coins because it was uncomfortable to carry coins in large quantities. They were first used in China in the seventh century.
