Page 26 - Banking Finance December 2022

ARTICLE

Fintech evolution: Fintech 3.0: (Since 2008- present):
After global financial crisis, mind set of general public
changed and developed systems to destruct traditional
financial systems. The shift in the mind set paved a way for
the new industry i.e, Fintech'3.0. Release of Bit coin, in year
2009, is a major technological advancement having high
impact on financial world. It has led to development of
different crypto currencies.

Another important factor, that is smart phone has
penetrated in to mass market with access to internet for
millions of people across the globe has changed the shape
of Fintech.

Google valet in year 2011, followed by Apple Pay in year
2014 are the developments paved the way.

Fintech often a short form for financial technology. It is a
new technology which helps to make the existing processes
simple, automatic, and make it possible to deliver the
financial services at the convenience of the customer.

Fintech 1.0 ( 1886- 1967)

It is all about infrastructure. It is the time when people
started thinking about financial technology. Financial
globalization has stated with the evolvement of telegraphs,
railroads have allowed rapid transmission of cross boarder
financial information transfer. FEDWIRE- first electronic fund
(A diagrammatic representation of Fin Tech terminologies
transfer started functioning since 1918 in USA relying on
over different periods)
technologies like telegraph and morse code. Credit card has
evolved in year 1950. (Source: https://www.linkedin.com/pulse/how-fintech-
dis rupti ng-r etai l-b anki ng-s pace- ronal -sh ah-
mba?articleId=6664098478370635777 dt.13.08.2021)
Fintech 2.0: (1967- 2008)
It is all about banks. A paradigm shift from analogue to digital
and is led by traditional financial institutions. Launch of first hand
held calculator and set up of first ATM by Barclays bank
happening during this period. Establishment of NASDAQ, world's
fist digital stock exchange in early 1970's marked beginning for
how financial markets are operating today. SWIFT established in
year 1973, most commonly used financial communication
protocol even used today. During 1980, mainframe computer
put in to use, leading to online banking which has flourished
during 1990, where internet acted as a catalyst for growth. E
commerce has taken its birth. Till global financial crisis in the year
2008, the era has shown technological developments like,
computerization of internal processes, digitalization of
communication with outsiders etc., happened.

26 | 2023 | JANUARY | BANKING FINANCE