Since the coming of Fintech, there has been wind of changes sweeping across the financial industry. Fintech has changed almost all features of financial industry including investment banking, retail banking and hedge funds.
The Fintech industry has a great potential for innovation. Ways through which finance can intermingle with technology to provide completely different, efficient and easy services are unlimited. Although there are many Fintech models, in this article, we will be Comparing three different Financial Models that best represent a Fintech Venture, and their Associated Economic Considerations.
Bitcoin uses peer-to-peer technology, operating with no banks or central authority. Issuing of bitcoin and management of transactions are done collectively by the network. It is an open-source and has public design. There is no individual control or owners of Bitcoin and anyone can take part. Since it has many unique features, Bitcoin enables exciting uses that could not be achieved by previous payment systems.
Bitcoin is an application that allows online payment systems. It serves as the currency in online transactions. The owner of Bitcoins possesses a private key that shows the ownership of bitcoins. It facilitates voluntary payment of fees; it is paid when the transaction processing has to be expedited.
Though Bitcoin is widely recognized, many governments are reluctant to declare it a substitute for their currencies. However, Bitcoin has potential to become a key part of the online payment system. Companies such as Microsoft are likely to invest in virtual currency. Apple is already having Apple Pay and Google has Google Wallet.
Bitcoin is important in any country’s economy because it acts as an excellent store of wealth. It provides a hedge against economic uncertainty.
Tag Cash is a Fintech model that allows creation of a digital economy through cashless transactions. It has significantly reduced the hassles of receiving and paying money online. In order to transfer cash through a traditional banking channel, IBAN and SWIFT are used to process the transaction. These are individual identities in banking and without them transfer of money cannot take place.
Tagcash is a unique fintech model that allows financial transactions to take place via Facebook, phone or email within a person’s social circle. Using Facebook contacts, email addresses or phone contacts, Tagcash links the senders and recipients’ bank accounts and processes the transactions accordingly. Consequently, an individual can transfer money to friends or family without being asked of many numerical details about the bank accounts.
Tagcash transactions support security in transactions and transparency in payment systems by reducing risks. De-risking and de-regulation are good incentives for investment.
Simple Tax is an application that makes the tax filing process efficient and easier. Though this Fintech model is currently serving Canadian market, it is helpful because it gives updates of the most recent regulations in the tax sector.
Most people see tax filing system as a burden. They often do not access the most up to date information about tax filing. People are also prone to filing wrong tax records. Simple tax came to provide solution to most problems that people face when filing taxes.
Revenue derived from tax is very central to economic development of a country. Tax is used to fund public expenditure. Simple Tax is therefore important in improving collection of tax; therefore, facilitating economic development.