Fintech: A brief history

Fintech, short for financial technology, is often described as the enmeshment of financial services and information technology, concepts most people would deem as relativity recent. Nothing could be further from the truth. The evolution of Fintech can actually be traced back to over a hundred years ago and be subdivided into various eras or periods.

There’s the period that ran from 1886 to 1967, detailing an era of infrastructure, including the introduction of the telegraph, railroads, and steamships – all of which facilitated the speedier movement of information over borders. It all culminated in the 1950s with the introduction of the first credit cards –  items that enabled consumers to carry less cash.

What followed was the period from 1967 to 2008, an expansive era which saw a transition from analogue to digital. Highlights of this period include and are not limited to the first handheld calculator, the first ATM, the establishment in the 1970s of NASDAQ, the world’s first electronic stock market and forebearer to the modern trading guide to USD / CAD market as offered through online trading brokers. The 80s brought about bank mainframe computers and the 90s introduced online banking and thus the birth of e-commerce. In the end, the way people viewed money and their relationships with banks had changed and 2008 signalled the end of this period.

Finally, we come to the current era of Fintech which entails the aftermath of the 2008 recession – the result of which has been the emergence of new markets, the founding of Bitcoin and subsequent cryptocurrencies, and the global proliferation of smartphones – which have in turn changed consumer behaviour forever.  Today Fintech usage is most prominent in China (69%) and India (52%) – due to the fact that both countries didn’t have access to developed levels of Western physical banking infrastructure and thus sought new solutions.

Fintech & Forex trading

Fintech has become integral to forex and in so many ways. Most newcomers to the world of forex trading will not notice this, but those who have been in the game for much longer are sure to account for the changes they have witnessed over time. For one, were it not for the evolution of Fintech, forex trading would still be in the hands of an exclusive group of people -namely tycoons, yuppies, investment bankers and brokers. Today anyone with money, a smartphone and the will to learn can partake in the complex, interesting and lucrative markets of forex trading.  Fintech has equipped today’s trader with secure rapid payments,  improved analytics for accurate market charts and trade predictions, and ultimately a platform for safer markets.  Automation technology is also becoming part of forex trading, the result of which has been robot-driven algorithms that offer traders higher volumes of trades with much less risk involved.

Fintech also offers associated attributes like machine learning and risk prediction software which in turn assists traders with programs that make near future predictions such as a market crash. The amalgamation of Fintech and forex is such that the relationship can be likened to what scientists call mutual symbiosis.  Demo accounts, a key feature for those looking to learn before attempting to earn, are also the by-product of Fintech as these accounts emulate the actual machinations of the forex market thus allowing all interested parties to gain a foothold in the field of familiarity.

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