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How Has Technology Benefited World Of Finance – Guide
Banks and insurance companies have had the same relatively static and highly profitable business models for decades. But today they are faced with innovators on all sides who want to turn their business upside down. Crowdfunding, peer-to-peer creditors, mobile payments, Bitcoin, robotic advisors – the variety or sky-high rankings of these “fintech” innovators seem endless.
However, some may note that they have heard this song before. Direct banks and the “digi-cash” of the 1990s also caught the imagination of journalists and investors, but they had little effect. Indeed, the financial services industry has been remarkably resistant to past attacks by innovators, in part because of the importance that size, trust, and regulatory expertise traditionally play in space.
Impact of technology on the world of finance
decentralized bank
Historically, banks and other financial institutions are in charge of the money, and whoever is in charge of the money often controls the world. This is starting to change now. There’s been a lot of hype about the blockchain – more hype than action – but the fact is, there’s every chance that, once the kinks are resolved, we’ll see dramatic changes across the world. The decentralized nature of the blockchain means that it is easier for individuals to send money to each other and buy houses, avoiding banks altogether. Individual savings will also be safer, especially in countries where corruption or inflation are the main problems.
Trading and Investment
It’s always a risk when you put your money at risk and invest. But these risks are becoming more manageable, thanks to technology. Automated trading software is making it easier to monitor investments, develop strategies and use algorithmic trading. For companies and individuals, the rapid development of certain technologies has made commerce and investment more advanced and specific. also opened up traditionally closed industries to anyone with an Internet connection and a willingness to learn.
bank fraud
As long as there have been banks or, for that matter, money, there have been people who have tried to cheat them. Technology hasn’t stopped it – it’s just made it more advanced. Cyber crime is on the rise, but it’s a race between banks and potential criminals. Smaller companies have benefited from advances in technology: while they are more likely to be targeted, they are also in a stronger position to keep their sensitive data safe.
private loan
As we said before, the banks already had all the power. If a person wanted a loan or a mortgage, he had to convince the bank that it was worth borrowing money for him. Thanks to the internet, this is no longer the case: people have a lot more options when it comes to how to get their money. P2P lending, for example, eliminated the middleman and connected private lenders with individuals at a price that benefits both.
Greater equality
We are more or less in the infancy of the internet, and how it affects the world of finance in the long run is still up for debate. Whichever form it takes, it seems to provide greater equality across sectors as it allows previously disconnected people to have better control of their money, without intermediaries.
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