Fintech and bank software solutions: Working together to redefine transactions, fund transfers and money overall.

March 6, 2024

FAQs

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A: The main difference between fintech and traditional banking is that, while fintech focuses more on newer technologies for delivering services, traditional banks (as their name suggests), focus more on legacy services. In other words, fintech solutions are oriented towards offering services that challenge conventional methods of transferring money, trading and managing investments.

Its traditional banking counterpart, on the other hand, is focused on providing conventional services surrounding regular savings and checking accounts, as well as credit facilities such as loans and credit cards. Many fintech solutions, though, still need to be comprehensively regulated - while traditional banks have many compliance standards already in place, depending on the region they operate in, and the type of financial services they offer.
A: Many leading banks, including top banks in Sri Lanka, have embraced fintech to offer consumers convenient options of managing their money from the convenience of their smart devices. Proprietary fintech applications enable even non-customers to sign up and avail services, thereby providing banks the advantage of reaching a wider customer base, while offering value-added services that enable easy money management on a self-service basis.

Banking software companies, as a result, have also been brought to the fore for this purpose. Through stringent custom software development and maintenance, software development companies need to stay in lockstep with evolving technologies as well as customer preferences, in order to determine how fintech applications need upgrading, and therefore maintain relevance across a highly competitive marketplace.
A: Fintech (a portmanteau of the words ‘Financial’ and ‘Technology’) focuses on four key technologies to enable new and innovative ways of moving money - in order to challenge the status quo established by traditional banks.

These four technologies are referred to as the ‘ABCD of fintech’, which include:

● Artificial Intelligence (AI): For delivering predictive insights, intelligently automating workflows, and detecting anomalies, ● Blockchain: Helping deliver a decentralised system of conducting financial transactions, ● Cloud computing: For hosting virtual infrastructure and utilising resources on an as-needed basis, to facilitate peaks and off-peaks in demand, ● Big data: Raw, unfiltered data that can be transformed to deliver actionable insights, in order to accommodate a wide variety of uses, from determining customer preferences to establishing enhanced cybersecurity.

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