The Development and Impact of FinTech in the Digital Economy

Abstract

FinTech can also be seen as technology-driven financial innovation, which uses various technological tools, such as combining big data, cloud computing, blockchain, and artificial intelligence, to innovate the services provided by the traditional financial industry, thereby improving efficiency and reducing operational costs. FinTech is currently developing at a rapid pace and will become the mainstream form of the financial industry. Components of FinTech include big data finance, artificial intelligence finance, blockchain finance, quantitative finance, and the development and use of cryptocurrencies, such as Bitcoin. FinTech currently exists most centrally for the purpose of financial services companies to integrate it with their own service offerings for the purpose of improving the consumer experience. FinTech can be used in a wide range of applications such as digital payments, peer-to-peer lending, venture capital, crypto services, robo-finance related advisory services, and fraud fighting. FinTech can maintain national financial security, achieve universal access to people's livelihood, improve the efficiency of financial companies' services and reduce staff management costs, promote the construction of "One Belt, One Road" by sharing financial results, solve the problem of financing difficulties for some SMEs, etc. However, there are still certain risks associated with finTech, such as the privacy of big data, the lack of comprehensive risk assessment of new technology applications, the operational risks, and challenges of finTech companies, the credit crisis of consumers due to irregular cooperation, and imperfect regulation, the intensification of competition in the financial industry, the probability of inflation and the formation of oligopoly, etc. FinTech is currently at the tipping point between the Internet finance stage and the deep integration of the finance and technology stage. In the future, FinTech will develop towards digital technology and blockchain technology, which will combine finance with network technology, psychology, cryptography, digital currency, and blockchain concept in the future.