Fintech Flashcards
What is FinTech?
Financial Technology (FinTech) refers to technology used to automate and advance financial services, improving efficiency, accessibility, and security.
What are the key components of FinTech?
Cloud Computing & APIs: Hosts fintech applications and integrates banking systems.
AI & Machine Learning: Automates banking decisions and personalizes platform features.
Big Data Analytics: Enhances decision-making, predictive analytics, and risk management.
Blockchain & Cryptography: Ensures secure, decentralized, and transparent transactions.
How do digital payment systems work?
Tokenizes and encrypts payment data for security.
Sends payment requests for approval to financial institutions.
Transfers funds from sender to merchant within 1-3 business days.
How does FinTech benefit individuals?
24/7 access to digital banking and payments.
Multiple payment options (mobile wallets, online banking).
Faster money transfers and global transactions.
How does FinTech benefit organizations?
Automates payment processing and increases cash flow.
Provides real-time transaction monitoring and fraud prevention.
Enhances customer experience and insights through data analysis.
How does FinTech benefit society?
Promotes financial inclusion for remote and unbanked populations.
Improves financial transparency and accountability.
Enhances economic development through digital finance.
What are examples of FinTech innovations?
Mobile banking apps (Chase, Tangerine) allow instant fund transfers and bill payments.
Mobile wallets (Apple Pay, Google Pay, PayPal) replace physical cards.
Blockchain solutions (Bitcoin, Ethereum) provide decentralized payments.
Robo-advisors (Betterment, Wealthsimple) use AI for automated investment advice.
What are competing technologies in digital payments?
Traditional banks (TD, RBC) offer trust and in-person services but lack flexibility.
Credit card networks (Visa, Mastercard) compete with digital wallets.
Cryptocurrency networks (Bitcoin, XRP) provide decentralized financial solutions.
AI-driven analytics improve loan processing and fraud detection.
Which industries benefit the most from FinTech and digital payments?
E-commerce & Retail: Enables contactless payments, BNPL (Buy Now, Pay Later).
Banking & Finance: Digital banks offer branchless services with lower fees.
Healthcare: Streamlines medical billing and insurance claims.
Freelance & Gig Economy: Provides instant and low-fee payments for workers.
What are the biggest challenges in digital payments?
Cybersecurity threats: Phishing, identity theft, and fraud.
Regulatory complexity: Varying financial laws across global jurisdictions.
Financial inclusion issues: Digital payments are inaccessible to some populations.
System reliability: Transaction failures, software bugs, and server outages.
What are the ethical concerns in FinTech?
Privacy risks: Centralized data collection increases exposure to breaches.
AI bias: Automated credit scoring may reinforce financial exclusion.
Financial surveillance: Consumers have limited control over personal data.
Market exclusion: The unbanked population lacks access to digital finance.
How can businesses secure digital transactions?
Use end-to-end encryption and tokenization to protect data.
Implement multi-factor authentication (MFA) and biometric security.
Monitor transactions with AI-driven fraud detection systems.
What is the future of FinTech?
Increased use of blockchain for secure transactions.
Expansion of AI-driven financial analytics and fraud prevention.
Wider adoption of digital wallets and cashless payment systems.
Growth in real-time payment processing and global financial inclusion.
