Fintech, or financial technology, is a hot topic in business news and media reports these days as technological advances change the way people bank and pay. What exactly does “fintech” refer to, and what will it bring in 2017? Here’s what you need to know.

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What is Fintech?

The term “fintech” is a combination of the words “finance” and “technology.” It refers to any technological innovation in the financial sector, including those affecting how people and businesses make payments for goods and services. Fintech innovations could make transactions more efficient and convenient for consumers.

Trend #1: Cryptocurrency in Banking

If you haven’t yet heard of Bitcoin, Ether or Etherium, you may soon become familiar with them as “cryptocurrencies.” A cryptocurrency is a form of digital money used as way to make and receive payments using a mechanism called cryptography. Digital currency, sometimes based on what’s known as blockchain technology, is getting the attention of both investment firms and big name businesses.

Trend #2: More People Using Mobile Wallets

A mobile wallet lets you carry your payment information in virtual form on your smartphone, tablet or smartwatch, and use it to make purchases. In 2017, mobile wallet use may increase as people become more comfortable with online banking and shopping and as new smartphones come equipped with built-in mobile wallets. In fact, a recent report from Juniper Research predicts mobile wallet spending will increase globally by 32 percent to a total spend of $1.35 trillion.

Trend #3: Rising Competition in the Fintech Credit World

Fintech has introduced a whole new range of lending options for businesses and individuals. Through online peer-to-peer lending platforms, individuals can invest in other individuals or businesses by lending them money directly. As alternative lending for individuals and businesses becomes more mainstream, the competition may heat up through 2017.

Trend #4: Biometric Features

Biometric features use physical attributes, such as your fingerprint, as authentication for a variety of technology, including smartphones. If you use voice or facial recognition or thumbprint verification on your tablet, computer or smartphone, you’re already using biometric features. Biometrics may surge in 2017 as it becomes increasingly available on mobile devices.

Trend #5: Rise in App-based Investing

In 2017, consumers may find themselves able to more easily make investment choices with apps, as these startups continue to roll out their new platforms. Rather than working directly with a broker, with the advent of investing apps, consumers can elect to invest their funds on-the-go and keep track of how their investments are faring.

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These rapid advances in technology are changing the way people communicate, shop, and bank. If fintech innovations deliver everything they promise, both individuals and businesses could enjoy faster, more convenient financial transactions.

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