History of FinTech

Knowing the past, helps us understand the present and plan for future. If you are building in FinTech industry, this article will provide you a summary of the FinTech developments in the past.

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Table of contents

• Key events in FinTech history across the globe
• Key events in banking in India
• Innovations in FinTech that are leading the ways
• Conclusion

Key events in FinTech history across the globe

The history of FinTech, or Financial Technology, dates back to the 1960s when the first automated teller machines (ATMs) were introduced. Since then, the development of fintech has rapidly evolved, driven by advances in technology and changing consumer demands. Some of the key milestones in the history of fintech include:

• 1960s: The first ATMs are introduced, allowing customers to access their bank accounts and make transactions without the need for a teller.
• 1970s: Credit cards become more widely used, enabling consumers to make purchases without carrying cash.
• 1980s: The first online banking services are launched, allowing customers to access their accounts and make transactions over the internet.
• 1990s: The rise of the internet and the development of mobile technology pave the way for the growth of e-commerce and online payment systems.
• 2000s: The global financial crisis leads to increased regulation of the financial industry and the development of fintech solutions to improve efficiency and reduce costs.
• 2010s: The rise of smartphones and mobile payment systems, such as Apple Pay and Google Wallet, make it easier for consumers to make payments and manage their finances on the go.
• 2020s: The COVID-19 pandemic accelerates the adoption of fintech solutions, including digital banking and online lending, as consumers shift towards digital channels for financial services.

Key events in banking in India

The history of banking in India dates back to the 18th century, with the establishment of the first banks in the country. Since then, the banking industry in India has undergone significant changes and developments, driven by economic growth and regulatory reforms. Some of the key milestones in the history of banking in India include:

• 1786: The General Bank of India is established, becoming the first joint-stock bank in India.
• 1806: The Bank of Hindustan is established, becoming the first bank in India to issue paper currency.
• 1894: The Imperial Bank of India is established, serving as a central bank for the British Raj.
• 1935: The Reserve Bank of India (RBI) is established as the central bank of India, taking over the functions of the Imperial Bank of India.
• 1969: The nationalization of 14 major banks in India, including the Bank of India, the Central Bank of India, and the Punjab National Bank, brings the majority of banks in the country under government control.
• 1991: The liberalization of the Indian economy leads to the entry of private and foreign banks into the Indian market, fostering competition and innovation in the banking sector.
• 2005: The introduction of the National Payment Corporation of India (NPCI) enables the development of a unified payments infrastructure in the country.
• 2008: The launch of the Pradhan Mantri Jan-Dhan Yojana (PMJDY) scheme brings banking services to unbanked regions of India and promotes financial inclusion.
• 2016: The demonetization of high-value currency notes in India leads to a surge in the use of digital payment platforms, such as mobile wallets and UPI, for transactions.
• 2017: The launch of the Bharat Bill Payment System (BBPS) provided a standardized, interoperable platform for the acceptance of bill payments across the country and facilitated the shift towards digital payments.

Innovations in FinTech that are leading the ways

There have been many innovations in FinTech in recent years, as technology continues to advance and change the way that financial services are provided. Some of the key innovations in fintech include:

• Digital banking: The development of online and mobile banking platforms has made it easier for customers to access their bank accounts and manage their finances from any location.
• Payment systems: The growth of mobile payment systems, such as Apple Pay and Google Wallet, has made it easier for consumers to make purchases without using cash or credit cards.
• Blockchain technology: The use of blockchain technology has enabled the creation of digital currencies, such as Bitcoin, and has the potential to revolutionize the way that financial transactions are processed and recorded.
• Artificial intelligence and machine learning: The use of AI and machine learning has enabled the development of personalized financial advice and automated investment services, making it easier for individuals to manage their finances.
• Online lending: The growth of online lending platforms, such as peer-to-peer lending, has made it easier for individuals and small businesses to access financing without going through traditional banks.
• Insurtech: The rise of insurtech has enabled the development of new insurance products and services, such as personalized and on-demand insurance, and has made it easier for consumers to compare and purchase insurance policies.

Conclusion

FinTech industry has gone various changes in the past and the rate of change is accelerating every decade. The next major breakthrough are not as far as the previous ones. In the next post, we will share resources for developers to keep ahead of this change or at least upgrade their tech stack to use the latest innovations in FinTech.

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