Introduction and What is Fintech
Dr. Tu Le
IBT, University of Economics and Law,
HCMC, Vietnam
Learning objectives
Discuss what Fintech is
Discuss the application of Fintech
Explore different perspectives of Fintech
Understand Fintech technologies
Fintech vs Techfin
Fintech: The use of technology to deliver
financial services and products to consumers
– Financial companies look for technology to improve
their service and customer experience
– A traditional bank offers mobile banking service
– Fintech is about non-traditional financial institutions
such as PayPal, Zеllе, and Vеnmо in the United
States, or online-only Starling Bank, Mоnzо and
Rеvоlut in the United Kingdom.
Techfin
– A technology firm that wants to deliver
financial products on the basis of existing
tech solutions
– Google, Amazon, Fаcеbook and Apple
(GAFA) in the United States, and Bаidu,
Аlibаbа, and Tеnсеnt (BAT) in China
Fintech Techfin
Exist with an objective to Exist with an objective to
maximize the use of emerging improve the existing
technologies to disrupt existing experience or capabilities in
‘old world’ financial services the financial services industry
models Not so disruptive compared to
The use of blockchains fintech but more incremental in
nature
Quiz
Plaid technologies
Alipay
Circle
Apple pay
Wechat Pay
Adyen
Qudian
Different perspectives on
Fintech
Fintech for dinosaurs
Fintech for entrepreneurs
Fintech for investors
Fintech for customers
Fintech for dinosaurs
‘We need banking, but we no longer need banks’
Bill Gate, The World's Billionaire, in 1994
The ‘dinosaurs’ of the financial world have evolved
rather than becoming extinct
It applies to all financial giants that are disrupting
the banking & capital markets, insurance services,
asset and wealth management, transfer, and
payment of funds
Bank-fintech cooperation
https://www.about.hsbc.com.sg/news-and-media/are-banks-
the-dinosaurs-of-the-digital-age
Fintech for entrepreneurs
Entrepreneurs refer to the start-ups or early-stage
companies
Fintech is seen as a sweet-pot by entrepreneurs
In the case of COVID pandemic, Fintech
entrepreneurs can fill the gap left by traditional banks
by making financial services accessible through
digital platforms
Fintech for investors
Investors see fintech businesses as a
‘need for the future’ to put money in, to
generate high returns
Both ‘technology’ and ‘financial sectors’
parent Fintech opens the door to
endless opportunities
Fintech for customers
Fintech aims to provide customers with alternative
channels for financial operations
Customers, especially millennials, prefer financial
services to be mobile, accessible 24/7,
personalized, and flexible.
Case study: CAPITAL ONE
How has Capital One fundamentally disrupted the
financial services industry?
How does Capital One differentiate itself from other
competitors in the card industry?
Potential benefits
Speed and convenience
Greater choice
Cheaper deals
More personalised products
Potential risks
Unclear rights
Making a rash decision
Technology-based risks
Financial exclusion
Fintech business applications
Applications of Fintech
Digital payments
– using mobile wallets instead of credit cards
Investment and wealth management
– The cloud-based bot-enabled platforms are
being used for advising users about asset
management and investment.
– Robo-advisors
Lending/Loan
– Apply for a loan using their mobile phones
either via banks or other online platforms
– Fintech credits
Trading
– Online trading apps have given anyone who can
invest in the market, monitor risk in real-time,
and share knowledge as well in the online
platform itself
– Traders can conduct huge data through ML
algorithms to identify trends and risks.
Personal Banking
– Banks and start-ups in this space are creating
online wallets and profiles to maintain services
to translate into a better and faster user
experience
InsurTech
– Users can acquire new services and fill out
claims directly from the app at any time
Regtech
– Focusing on the automation compliance
rules/processes for financial institutions
– Anti-Money Laundering and Know Your
Customer (KYC) guidelines which cope up
against fraud
– Offering quick and cost-effective management of
massive data, i.e transactional data/records and
compliance documents, such as corporate tax
returns.
Fintech technologies
Artificial Intelligence (AI) and Machine
Learning (ML)
– Some of the fintech applications of AI and ML
include credit scoring, fraud detection, regulatory
compliance, and wealth management.
Big Data and Data Analytics
– Used to predict how consumers are likely to
behave.
– Contribute to formulate marketing strategies and
fraud detection algorithms.
Robotic Process Automation (RPA)
– The process of assigning manual, repetitive tasks
to robotics instead of humans in order to
streamline workflows in financial institutions
– Statistics and data collection
– Regulatory compliance management
– Communication and marketing through e-mails
and chatbots
– Transaction management
Blockchain
– Blockchain technology is being adopted at a
large scale in the financial industry
– Each transaction is encrypted, and the
chances of successful cyber-attacks are
relatively low when blockchain technology is
employed.
– Blockchain technology is also the backbone
of many Cryptocurrencies.
Fintech implications for
established businesses
Why is fintech a threat?
– https://www.youtube.com/watch?v=Zw_kU
sZftps
Global Fintech trends for 2021
Top predictions for fintech in
Q1 -2021
Pulse of Fintech H2’20, KPMG
Strategies for established
businesses
Cooperating with new entrants,
Acquiring them partially or completely
Competing with them directly
Summary
Know different aspects of fintech
Know potential benefits and risks of
Fintech
Understand the application of Fintech
Understand Fintech technologies
