Why the question of the importance of FinTech in Nigeria?
According to Statista, there were about 144 Fintech startups in Nigeria at the end of 2021. This shows a rise in this industry in the country. This rise can be credited to the increase in demand for FinTech companies and services.
Furthermore, the increase in demand is tantamount to the relevance and importance of FinTech in the Country’s financial sector.
But what is FinTech? And why is it important?
What is FinTech
FinTech stands for Financial Technology.
Financial Technology refers to any Technology or innovation that improves financial services and makes them easily accessible. It includes any digital innovation for sending/receiving money, transacting online (buy and sell), investments, accessing loans and other financial activity.
A Fintech company is a company that has improved the financial sector using digital technology. Examples of FinTech companies in Nigeria are Flutterwave, Kuda, Paystack, Remita, Piggyvest, Interswitch, Opay and others.
Consequently, FinTech companies compete with traditional financial systems to provide efficient delivery of financial services using technology.
Internet banking, Mobile Banking, Insuretech, digital equity companies, investment platforms and cryptocurrencies are examples of financial technology.
What is the importance of FinTech in Nigeria?
Fintech is solving the problems in the financial sector that the traditional systems either cause or can’t solve. It makes possible, what was once impossible.
Here are some of the advantages of FinTech
FinTech makes financial services accessible to people all over the world.
Without FinTech, access to such services would have been impossible for many people.
For instance, buying foreign goods, or paying for services in faraway countries online was once impossible in Nigeria. However, with the emergence of FinTech, international transactions are now available online.
FinTech reduces the stress involved in carrying out financial activities.
For instance, it would be physically draining if a student had to walk to the bank every time he wants to pay school dues. However, with FinTech platforms like Remita, he/she can do that from the comfort of their bed.
Importance of Fintech in Nigeria: It is Cheap
FinTech makes financial transactions less expensive. You don’t have to pay for transportation to the bank to get an atm card that comes with charges. Rather, you can open a Kuda account and get an atm card delivered to the doorstep at no cost and without charges.