Author: yinzhichen

The startup Fintech company named Revolut just launched a brand new credit feature for U.K users. Revolut is working with Lending Works to provide features to customers. Lending Works is a peer-to-peer lending company that matches individual lenders with borrowers. Customers can select how much money they want and the number of months they need to pay it back. After entering your monthly income and residential status, you will get a quote and you have the option to accept or decline. In addition, the borrowing APR rate is lower than credit card or a traditional loan.
Except for this plan, Revolut is planning to have travel insurance, investment products and also lending and borrowing in multiple countries. We can see that after Fintech has launched, financial institutions have very severe competitions from those Fintech startups. Those startups offer better deals in a more convenient way to customers. Therefore, the traditional banking institutions are facing very big challenges right now. However, banking institutions have higher reputations and people from older generations are tend to trust traditional banking than the new startups. Although Fintech startups provide better products, it still takes time for them to build great reputation.

Revolut users can now apply for credit in just a few minutes

Pariti is an app that help you get out of debt quicker. It is a personal finance mobile app that helps you keep an eye on your spending and tracks how much you are paying out servicing existing debt, such as overdrafts or credit cards. It then suggests changes you can make to pay off that debt more quickly. This mobile app connects to users’ existing banks and credit cards to analyze the financial standing and calculate whether the users can save on their debts.
I think this new app is very practical and helpful for most people. Since most of us have credit cards and loans to pay, it would be better if something more professional can help us to make plans for spending and saving. And this app can also help people to be aware of the true cost of the money they have, or borrowed. In addition, this app can also help lending partners get more accurate pictures of consumer suitability, affordability and credit worthiness about their customers and do corresponding adjustments for the lending rules. There is no doubt that this transparency of finance can help consumers to realize their true situations.

Index-backed Pariti is an app to help you get out of debt

There are news saying that some financial institutions begin to have robot advisers in their financial advice services. And some people also argue that robot advisors can provide better services to clients than human advisors can. According to their words, software is far better at most jobs than people can. And it is especially true in the world of financial advice.
I personally think that these statements are half right and half wrong. I believe that software can do better work than human in some aspect, but not all of them. It is true that most financial advisors heavily rely on models and software to give advice to their clients, but they also need to use their human brain to evaluate something that software cannot do. In addition, I believe that those financial advisors who have better performance, they give advice based on their own knowledge and experiences, which robots do not have. Last but not least, most people would feel more comfortable and prefer people who have more in common rather than robots to provide services.
I think if robots can cooperate with human to provide financial services, financial institutions can offer clients with better advice.
http://www.fintechbusiness.com/industry/662-robo-advisers-better-than-humans-wealthfront

Chinese banks are looking for blockchain experts to fight fraud. According to the article, the demand from Chinese banks for experiences in blockchain more than doubled last year and will grow further in this year. Since Fintech becomes increasingly significant in financial field, the demand for blockchain will even increase in the future and there is no sign of slowing.
I think it is a really good trend for Chinese banks. As I know, the way the banks store documents are still in paper, which is not transparent and safe enough. Therefore, if Chinese banks start to use blockchain, a ledger system that processes, stores and tracks digital information, from crypto-currencies to loan agreements, then all data and information can be stored into the single system. By doing so, the system can document all changes and would be harder to tamper with, which make transactions more transparent, audible, and secure. In addition, blockchain system can also help banks to avoid fraud cases such as fake trade finance deals. Although blockchain solution is very nice for banks, being able to integrate that back into the existing systems in a sensible way is still a challenge to banks. Blockchain is too complex for Chinese banks to apply to the system successfully.
http://venturebeat.com/2017/01/26/chinese-banks-are-using-blockchain-to-fight-fraud/

If Fintech companies want to produce software for financial industry, they need to produce something that is easily customizable by the technical layman. Because nowadays, most of the Fintech products target at end clients or bigger dealer groups and institutions. For both end clients and groups dealers, they have different needs, which require Fintech software to provide customizations so that financial advisors do not have to spend money on customizations themselves.
According to the article, the trick to providing customized Fintech software is to release products that are targeted towards specific needs and in specific best-practice ways for financial advisors, but still give them the control in how they present themselves to their customers. Therefore, financial advisors can provide the best service to their customers with the help of Fintech software.
I think it is a very reasonable way to design Fintech software for financial institutions, but I feel it might not be as practical as it sounds. Because the economy world keeps changing and it is very likely that after you design a Fintech software with specific needs and launch it for a while, the trend of financial needs changes. When it happens, it would be very costly to financial institutions to change with correspondingly.
http://www.fintechbusiness.com/industry/643-ifas-being-left-behind-by-fintech-companies

Fintech is one of the most popular topics in the world right now, and most people believe with the development of Fintech, there will be a huge change in almost every industry like banking, mobile payment apps, and so on so forth. Before reading this article, I think the regulation would be the biggest problem for Fintech to be more influential in our lives. However, interestingly, this article states reasons why Fintech is falling.
As a matter of fact, all reasons are related with finance field. Everyone from online lenders to bank technology companies has experienced elongated fun-raising cycles, missed targets and mounting losses. According to the article, one of the reasons why Fintech is falling is that there is contradiction between Fintech and finance. Since finance is a kind of slow-moving sector, but Fintech is fast. In addition, most companies are looking at short-term growth which means they do not focus on the innovation. It causes problems and risks to Fintech. Last but not least, most companies hate to change. This is a big problem that influence the evolution of Fintech, since it is costly and time-consuming for companies to adopt Fintech and change their systems which has been running for many years.
http://www.forbes.com/sites/chrismyers/2017/02/07/3-reasons-why-fintech-is-failing/#65eebb727b6b

The digital revolution brings great disruption to the traditional banking and world’s retail financial institutions. Fintech competitors, who are real-time and low-cost, bring risks and threats to existing traditional banking. Because when compare to Fintech competitors, it is hard for traditional institutions to respond quickly to the changing in digital environment and customer expectations.

According to the article, some people believe that by 2020, the landscape is expected to be shaped strongly by both technology and non-traditional competitors. Retail banking will be automated, and people are more tend to welcome Fintech firms than traditional institutions. Since traditional institutions are more likely to handle cash transactions, they believe that there would be less cash transactions in the future.

I think although Fintech companies will become increasing popular in the future, traditional institutions are still greatly needed by customers. Technologies do bring changes to life, but they are hard to adopt and need great time for people to learn. I believe there will still be need in peer to peer transactions in the future and the trust and customer experiences the traditional institutions have built will remain. In addition, Fintech will also face regulatory problem.

https://fintechweekly.com/#fintech-latest-news

 

In 2017, Fintech will continue to be influential. With Fintech becoming more and more widely used across the industry, it challenges the traditional models, gives business and customers better and easier solutions, and also provides better technical tools to companies.
Data will be more accessible to individuals and business. In 2017, there will be more data for business to analyze. Business companies can clean and compile the data they got and solve the business questions they come up with. By doing so, companies can come up with better solutions for the services and products they provide to customers, and help to operate the business well. The influence of Fintech helps artificial intelligence to emerge. Artificial intelligence will be more welcomed by advisors to track the account activities through products and services; and they analyze the data to understand customer behavior.
In addition, the mobile workforce will still be a trend. More and more companies will launch their own apps and mobile transactions will be greatly increased to make people’s life easier.
With Fintech becoming a trend in business, hope the new tools and processes will secure the systems, and make the fraud much easier to be detected.
https://www.finextra.com/blogposting/13503/five-key-trends-that-will-see-fintech-enhance-its-role-and-impact-in-2017?utm_medium=email&utm_source=fintechweeklycom

According to the article, Nanthan Mueller overused his position at company and caused a $8 million fraud. He worked as a manager and had power to request and approve the check. In addition, he knew everyone else’s password to the system, so he requested a check by using his colleague’s system and approved by himself. By doing that, he first paid off his credit card for several times by getting checks from “Universal” account, which stores transactions with an insurance company. Later he opened a bank account under the name of “Ace Business Consulting” and started getting checks from “Ace” account like other routine transactions.

I think there are still many Muellers out there, and it is significant to keep the financial information system under controls. First of all, FIS should have authentication controls that can restrict the access of authenticated users and limit the information and capabilities for each user. Moreover, the FIS needs more development within the system that can detect unmatched transactions automatically and avoid fake check requirements. In addition, physical safeguard is important. The same employee should not have the authentication to both request or approve the check and print the check.

http://www.journalofaccountancy.com/issues/2014/aug/fraud-20149862.html

Fintech becomes an increasingly significant trend in business that even banks are reaching out for technology solutions from Fintech vendors.
According to the article, with the life simplified by technology, customers have expectations for seamless, intuitive and easy processes when handling bills, managing accounts, or engaging in financial activities. Take Canadian bank for instance, it combines its traditional business systems with technology solutions from Fintech vendors for better customer experiences, while protecting bank’s data assets, managing system and mitigating risk stably and securely at the same time.
I believe working with a mature Fintech vendor is a wise decision for banks, when compare to developing Fintech system by themselves. By doing that, banks can provide customers with service in shorter time and save the budget and labor for other important uses. However, banks bear risk, too. Before cooperation, banks need to spend heavy research on choosing the right partner vendor in order to have consistent and secure system. Banks should be concerned about the amount of information provided to the vendor to avoid unnecessary leak of information. In addition, frequent communications are highly recommended between banks and vendors.

link to the article: http://www.digitalistmag.com/customer-experience/2017/01/10/improving-customer-experience-look-to-fintech-04826561