Fintech is a phrase used to represent technology-based finance companies. The financial sector embraced technology quite rapidly and many financial transactions that were carried out physically are now done through the electronic form. Banking operations, for example, making payments by cheques is no longer the norm, but the exception. This applies to the business to business (B2B) and peer to peer (P2P) transactions. Mobile apps have been developed that facilitate instant transfer of money. Fintech Iceland has also kept pace with the developments worldwide and it is common to find online payments being adopted throughout the country.

Banks in Iceland Have Adopted Fintech in Iceland Easily

Banking services are quite commonly used by practically every Icelander. The banks have now made their day to day services available to the customers online. This means the banking operations like making payments, checking on the balances in the accounts, and making investments even can be carried out sitting at home. Landbankinn, Islandsbanki, and Arion Bank are three large banking institutions in Iceland that have adopted electronic banking, and there are other players in the field too, offering similar services. The banks have mobile apps also and their customers can download and use them for regular banking transactions. Fintech Iceland has not posed any difficulty to the public in accepting and adapting. It has to be conceded that it has made life a lot easier for ordinary people to manage their finances. In particular, the elderly Icelanders have been spared the trip to the bank and many of the services are available 24/7.

Fintech Startups

Another facet of fintech Iceland is the entry of startups in the fintech sector. The advancements in technology have meant that companies can offer financial services without having to open offices or branches. One area the fintech companies have identified the scope is in lending. In the earlier brick and mortar regime, you had to visit a lender, usually a bank, and fill out an application form. The executive in the bank will then verify your loan eligibility and your credit score and you may know after a few days if the loan was approved or not.

The fintech companies have completely changed all that. Now, you need to just log into one of these fintech companies and fill in your personal details on the interactive form on the screen. You submit the online form and it may take only a few hours before you receive a message on your mobile if the loan stands approved or not.

This has been made possible with new technologies like big data which can process your credentials against information available online including your credit report and the computer, not a human would do the processing and suggest to the lending company’s executive whether you are eligible for a loan or not.

How Do Fintech Companies Operate?

If you have wondered how the fintech companies function and where they get their funds from, the new startup regime has enabled young entrepreneurs with the right ideas and float companies and invite investors to place their faith in their business model by making investments. There are organized venture capital firms as well as angel investors who conduct due diligence and make the investments. Fintech Iceland has benefitted through these startups and will make a huge impact in the country’s financial sector in the years to come. There is expected to be a healthy competition between the banks and these new-age small outfits. They ultimately function as an extension to the banking system since the funds are routed through the banks.

It is the average Icelander that benefits from these developments and the country mirror the international community on even footing.

For any assistance in Iceland, contact Swapp Agency.