Common FinTech Services
Digital Payment Apps
Have you ever used Venmo? CashApp? Zelle? If so, these are all examples of Financial Technology. Digital payment apps have become a big part of our lives as the convenience these apps offer is almost unparalleled. They can help you pay back your friends quickly and more. People might have tens to hundreds of dollars sitting in Venmo and similar services. Digital payment services are very convenient and can help in multiple facets of your life; however, security is critical with technology.
Your money is not insured in places like Venmo, so if Venmo loses it, you'll likely not be reimbursed. However, Zelle is a digital payment connected to your bank account, meaning that your money is insured, but often, you need help to reverse transactions, so if you send your money to a scammer, it's unlikely you'll get reimbursement.
Federal Deposit Insurance Corporation(FDIC):
FDIC insurance is what keeps your money safe in banks. Your deposits up to $250,000 are insured at most banks. Therefore, if your bank collapses for whatever reason, you will get your money back. However, digital payment apps like Venmo are not FDIC-insured, meaning that if they collapse, your money is gone.
While digital payment apps might all seem similar, they have different business models, and it is crucial to understand the convenience and possible problems associated with each.
Budgeting Apps
Budgeting apps are a very helpful type of financial technology that helps you get your spending under control. Budgeting apps like Monarch, Rocket Money, YNAB, and others allow you to connect your financial accounts to deliver a comprehensive view of your overall financial health. These apps can help you understand your spending habits in depth and help you reach financial goals.
Student Loan/Debt Management
Debt management apps are another type of financial technology pertinent to students. Especially with the rising student debt balance among the young adult population, debt management apps can be a crucial tool to handle the goals of going to college while not financially destroying yourself. These apps can help you navigate through federal student loans by suggesting different repayment plans, and for private loans, they can suggest ways to refinance your loans to decrease the complexity of debt in the current age.
Next Chapter: Investment Applications
[Chapter 1]: What is FinTech and Why Do You Care?
[Chapter 2]: Common FinTech Services
[Chapter 3]: Investment Applications
[Chapter 4]: Cryptocurrency
[Chapter 5]: Blockchain
[Chapter 6]: FinTech in the Insurance Industry
[Chapter 7]: Financial Security and the Future