“What is Fintech?”
This question, focused on the foundational meaning of an emerging sector, seems very straightforward. However, depending on whom you ask, “What is Fintech?” can yield rather different, illuminating answers. While it is possible to refer to textbook and academic definitions, as you can read in our earlier blog, it’s arguable that greater insight can be gathered from unique perspectives of thought leaders from within the industry itself. And so, we have selected a few excerpts from our global team of experts and lecturers featured on Around Fintech in 8 Hours — our Fintech Foundation Course — to help demystify the concept of technology disrupting finance, as well as explaining what exactly this transformation means.
Huy Nguyen Trieu is a co-founder of CFTE and the CEO of The Disruptive Group — a business builder and advisory firm in innovation and finance. Additionally, he has been a frequent keynote speaker across industry events in Europe & Asia and regularly quoted in global publications on innovation in finance. This is all to say, he is rather qualified to outline “What is Fintech”.
In Module 1 of Around Fintech in 8 Hours, Huy explains
“When we think of Fintech we normally think of Fintech startups and [these] would be companies trying to create new services and compete with the existing banks… but we need to go much further than that.”
He goes on to detail how Fintech is, at its very essence, about the “very intense transformation that technology is bringing to finance”.
Giving the examples of Alibaba, Citadel and Zhong An, he explains this transformation is being led not only by startups, but also e-commerce companies; asset managers; hedge funds; and banks interested in leading this ‘new world’ of finance.
Amount Investment in Fintech since 2010 (in millions). Taken from CFTE’s Around Fintech in 8 Hours course.
That is not to say, however, that investment in Fintech startups have slowed down. Quite the opposite! Investment in Fintech startups in 2016 hit 23.6 billion dollars, over 10 times the figure from 2011. This emphasises Huy’s point that “new ways of consuming finance are appearing everywhere, everywhere around the world — whether you are in Europe, in the U.S, Asia or Africa.” The spread of innovation is global.
CFTE lecturer Ronit Ghose echoes similar sentiments later on in the course. Ronit is Global Head of Banks Research at Citi, and since joining in 1997, he has covered banks in the across North America, Europe and the Middle East. In his exclusive interview with CFTE, Ronit explored how technology affects finance globally. He stated
“The main thing that’s changed is CEOs and boards’ focus on technology and innovation… Today more CEOs in banks and insurance are thinking of the long term and how technology will transform the the long term outlook for our industry.”
Further insight into “What is Fintech?” can be found with our interview with Kabbage CEO Rob Frohwein, which is incidentally also included on the programme. Rob says
“I think the global financial crisis in many ways gave birth to Fintech… because everybody looked away. When people look away, there’s a few people who don’t and they do something interesting.”
He expanded on this point, claiming the period sparked a ‘renaissance in financial technology’ which is still going on today.
In summary, while the notion of understanding Fintech concepts may seem intimidating, we hope to have proven that gaining such knowledge is made much easier with appropriate resources. We always encourage professionals, and those looking to enter the industry, to learn to speak the new language of finance first. This means an accessible and comprehensive programme that matches the rigors of the industry and provides a solid foundational background of the sector. Our Fintech Foundation Course — Around Fintech in 8 Hours — provides these aspects in a clear framework with no prerequisites and is taught by those building this new world of Fintech!
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