The word fintech has never been more listened to than in recent times, thanks to companies like Nubank , credits and so many others that have revolutionized the financial market, made the term more and more common in our vocabulary, and now we have the OpenBanking , a new movement that will increasingly encourage the emergence of these companies. But do you know what they do and what is the difference for a company to be called a Fintech?
Another term that will become more and more popular is the Embedded Fintech , we will explain the difference of this concept later.
What is and what makes a Fintech?
fintech (from English: financial technology ) is a term that arose from the union of the words financial (financial) and technology (technology). Fintechs are mostly a concept for new and innovative companies that work to innovate and optimize services that already exist in the financial market.
These companies have much lower operating costs compared to traditional institutions in the sector and also less or zero operating processes already exist, which allow them to use state-of-the-art technology to optimize their processes, which consequently makes the services offered cheaper.
In essence, fintech is used to help companies, business owners and consumers better manage their financial operations, processes and lives, using specialized technological processes to offer new means of services, different from what we were used to a few decades ago.
What is and what is the difference of an Embedded Fintech?
Embedded Fintech (in Portuguese: Fintech Embedded ), corresponds to the creation of a Fintech within or by a company that does not have as its main business model the offer of financial services, we can use as an example Apple/Google, which created payment services embedded in its platform.
An interesting movement is that traditional companies in the financial market have increasingly invested in this business model, as they have processes and services running for a long time and with a large number of customers, the change to a more modern and technological model. Sometimes it's not possible, at least not in the short term, so a solution is to create a new company/platform so as not to lose market, which is increasingly demanding. An example of this scenario is the creation of the company iti , an Itaú payment service.
Examples of Fintechs
Within Fintechs we can separate into some groups of use:
Crowdfunding platforms allow users to send and receive money from each other to fund common projects or causes. They became an efficient way for people looking for money to build or invent something, and also for social causes.
Rather than having to turn to traditional banks for loans or philanthropic companies, users are able to organizely publicize and raise capital for their purposes. Some examples of these platforms are:
Digital payment platforms or even complete banks could fall into this definition, normally these companies do not have physical locations and all their solutions rely on cutting-edge technology. From creating your account to using the service, all digitally, they offer an alternative way to make your payments without the need to resort to traditional models. Some examples of these platforms are:
- http://nubank.com.br – Digital Bank
- https://picpay.com – Payments Account
- https://www.amedigital.com – Payments Account
A sector that has always generated and moved a lot of money, and a very important part of the economy, is the offer of credit. Currently, there are companies innovating in this segment, making it easier for companies and even individuals to get a loan and at more attractive rates than traditional companies. In addition, some platforms offer the service in a P2P (Person to Person) format, generating a new way for people to invest and lend money. Some examples of these platforms are:
- https://www.creditas.com – Loans to individuals
- https://www.nexoos.com.br – Personal P2P Loans for Companies
- https://mutual.club – Personal P2P Loans for Individuals
Previously, access to investments in the Financial Market was not very user-friendly, only people with a lot of money or from the market itself were able to invest in this market. But in recent years this has changed, more and more companies and brokerages have been modernizing, facilitating access to all types of investments available to financial market professionals. Some examples of these platforms are:
- https://www.xpi.com.br – Digital Brokerage
- https://btgpactualdigital.com – Embededd Fintech of BTG Pactual
- https://www.easynvest.com.br – 100% Digital Brokerage
Insurance is a market that has been innovating a lot, more and more platforms specializing in insurance are emerging. It is interesting to note that these platforms have enabled the creation of insurance on things and services that would not have been imaginable before, such as cell phone insurance. Some examples of these platforms are:
- https://www.youse.com.br – Miscellaneous Insurance
- https://www.pier.digital – Mobile Insurance
- https://www.bidu.com.br – Miscellaneous Insurance
6. Financial control
Well, with the advancement of so many technologies and a never-before-available range of financial services, we need somewhere to control and manage everything. Applications specializing in the control of personal finances and investments has been emerging and becoming an essential tool to take control of your money. Some examples of these platforms are:
- https://www.guiabolso.com.br – Personal Finance Control
- https://www.organizze.com.br – Personal Finance Control
- https://www.olivia.ai – Control of Personal Finances with Artificial Intelligence
- https://gorilainvest.com.br – Investment portfolio
- https://orealvalor.com.br – Investment portfolio