The past decade has seen a surge of disrupting internet startups, and the main weapon of these disruptors has been “data”. The disruptors in the financial services sector are being officially labelled ‘Fintech’ startups, and the same terminology is being extended to other sectors namely insurtech, edutech and so on..
Following on the success path of huge e-Commerce giants, the fintech startup companies are leveraging digital channels to acquire customers and data to understand them and sell them better products.
Fintechs are providing the transparency and education required to get the confidence of their customers. They are reducing the middleman commissions, removing manual frictions, bringing down transaction costs and reaching out to sections of the society that were unbanked or underbanked. As more data is available publicly, these startups are leveraging it to understand their customers, thereby providing loans, insurances, payment services and investment options to the markets that traditionally remained untapped by the incumbents.
Needless to say, there still lies a huge opportunity for startups to build interesting products that can leverage data to attract new customers.