Fintech
Financial technology — companies and innovations using technology to improve or disrupt traditional financial services.
What is Fintech?
Fintech (financial technology) refers to companies and innovations that use technology to deliver financial services more efficiently, cheaply, or accessibly than traditional financial institutions. The fintech sector spans payments (PayPal, Stripe, Square), lending (LendingClub, SoFi), insurance (Lemonade, Root), wealth management (Robinhood, Betterment), banking (Chime, Revolut), cryptocurrency exchanges, and regtech (regulatory compliance technology). Fintech companies often leverage mobile platforms, APIs, machine learning, and big data to offer better user experiences and lower costs. They have disrupted incumbent banks and brokers, forcing rapid technology adoption. Regulatory challenges remain significant — most fintech companies must comply with the same banking, lending, and securities regulations as incumbents.
Example
Robinhood launched in 2013 and popularized commission-free stock trading, forcing industry giants Schwab, Fidelity, and TD Ameritrade to eliminate commissions in 2019. Robinhood's mobile-first interface and fractional shares attracted millions of young investors who had previously been priced out. By eliminating commissions, it also removed a $4+ billion annual revenue stream across the industry.
Source: SEC — Robinhood Financial 10-K