Three Examples of FinTech
Financial technology is a sector full of possibility and promise. This world of smaller startups dabbles in the back-end banking technology that powers the systems consumers currently rely on. The trouble is that almost half of the American public isn’t seeing a benefit to these essential services. Investments in smaller companies will fuel an economy of more agile startups aimed at impacting consumer finance. Here are three ideas currently floating around.
Peer to Peer Loans
Right now, a payday loan charges high rates of interest in order to help a person living paycheck to paycheck make ends meet. The costs of that money are too high for any lower income person to live sustainably, but there is a need for that short term loan in the smaller dollar figure. Peer to peer lending will help wealthier individuals shoulder a relatively small risk in the hopes of lending money to those who need it. Because costs are lower than they are for banks, interest rates drop and subprime loans have a higher probability for payback.
Crypto Currency
Crypto currency is fascinating and enigmatic all at once. Its anonymous nature suggests illicit use, but the currency may have real value in the broader market. The trouble is that it’s still too early to tell. You can order a pizza, and you can even pay in bitcoins at some retail outlets, but crypto currency is a long way from competing with the dollar.
Financial Information
The lower class needs information about their bank accounts faster than we can currently provide. Consolidation is another driving force behind better financial information. Consumers don’t want to wait three days for a check or a credit card charge to come through.
Phineas Upham is an investor from NYC and SF. You may contact Phin on his Phineas Upham website or LinkedIn page.