by Megan Sells,
African Business Writer,
Members of the American Legion report,
msayles@afro.com
Fintech already means the integration of technology in the delivery of financial services. The catch-all term includes digital lending and credit, as well as mobile banking and payments, and more recently the new world of blockchain and cryptocurrencies.
But the roots of converging finance and technology go back to the late 19th century, long before computers, the internet or smart devices existed. One thing that continues to be true over time, technology helps people take control of their financial future.
According to the Payments Association, the laying of the first successful transatlantic telegraph cable in 1866 provided the infrastructure for connecting financial markets around the world. Then, decades later, the Fedwire Funds Service was created, allowing the Federal Reserve Bank to make electronic transfers using telegraph and Morse code.
The next evolution in fintech was the invention of the first ATM, or automated teller machine, in 1967, an era in which finance moved from analog to digital, according to the Payments Association.
Nasdaq is the world’s first digital stock exchange, created in 1971. Online banking took off in the 1980s, and PayPal launched in the 1990s, paving the way for digital money transfers and online purchasing services like Stripe and Square.
Today, fintech is used every day. Whether you’re sending money on the Cash App, using your bank’s mobile app, or investing with Robinhood, you’re leveraging fintech.
Washington, DC native Angel Rich has worked in the financial services industry for two decades. She gained notoriety at the age of 22 when she sold her technology-based business plan, which involved marketing financial services and insurance online, to Prudential Financial more than a decade ago.
She is the founder and CEO of CreditStacker, a gaming app that teaches young people the basics of personal finance and credit management, and CreditRich, an AI-powered Pay bills to improve user’s credit score.
The latter, launched on Black Friday, offers credit reporting, mobile banking and online payments on a single platform.
Since attending Hampton, Rich said she believes technology is the key to providing more financial freedom.
“I definitely think fintech is providing access to funding and knowledge that was previously unavailable to the black community,” Rich said. “I see this as an opportunity, kind of like the opening of a library and a bank, so by bringing the two together, people can let their financial imagination run wild.”
One of the most effective ways for consumers to use fintech solutions is to become as wealthy as possible, Rich said. People can utilize different services to optimize their credit score and gain higher creditworthiness, which can then be leveraged to gain greater bargaining power and new investments.
Consumers can also use fintech to learn about the stock market and how to manage their portfolios, and they can discover how to leverage their 401(k) plans and IRAs to invest in innovative companies, which will help them grow their private equity investments Combination, according to Rich.
While small businesses can use fintech solutions to manage payroll and track business expenses, Rich said they can also provide employees with wealth management and credit-building tools.
According to Rich, this prevents workers from facing financial stress, making them more likely to be productive and innovative.
For those wanting to learn more about fintech, Rich recommends following financial news outlets and podcasts and comparing the information they receive with advice from people with credible expertise in the financial services industry.
In the future, Rich hopes more fintech companies will address the lack of financial literacy in communities of color. Without an understanding of financial terminology or financial transaction skills such as budgeting and investing, people risk being ripped off and exploited by bad and incompetent actors in the financial services industry.
“I would love to see the democratization of financial education. From what I know, financial vernacular has become a gatekeeper in certain communities, not allowed inside the golden walls of financial prosperity,” Rich said. “I believe that financial technology presents an opportunity for everyone seeking [financial prosperity] Those doors can be entered.
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