50 Popular Fintech Terms You Must Know

<img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/04/pci-dss.webp" alt="M2P Fintech" title="" width="100%" height="253"><p class="text-node" id="hdzj80141" style="text-align: justify"></p><p class="text-node" id="x7oi8si42" style="text-align: justify">The payment industry is constantly growing where every upgrade plays an important role in developing trust among users by protecting their sensitive data. So, every business that is an active participator needs to meet few security standards that act as Armour.</p><p class="text-node" id="50ba" style="text-align: justify">One such globally recognized standard is PCI DSS.</p><p class="text-node" id="hop4isbj1" style="text-align: justify">The PCI Security Standards Council came up with a Payment Card Industry Data Security Standard (PCI DSS) framework to protect credit and debit card transactions and card holders’ data from breaches. It is a mandate for every merchant and service provider to abide by this protocol for a smooth customer experience.</p><h2 class="heading-node" id="e2ee" style="text-align: justify">How was PCI DSS created?</h2><p class="text-node" id="3093" style="text-align: justify">It all began during the internet boom in the late 1990s, when the initial stage of e-commerce brought in many fraudsters and excitement. When the retailers, merchants, card networks, consumers widely accepted the emerging web-driven transactions, they witnessed a steady increase in credit card fraud and scams. That is when the card networks like American Express, MasterCard, and Visa started to dig deep into the issue to create standards for payment processing systems.</p><p class="text-node" id="c5ac" style="text-align: justify">With Visa taking the lead in 2001 “Cardholder Information Security Program” standard was introduced, followed by the other companies implementing their security standards. But it did not meet the expectations of the merchants and POS terminals as they need to comply individually with the company-specific standards. This resulted in great difficulty for merchants as they have to comply with different standards when they are approaching multiple card networks. So, the collaboration of the major card networks such as American Express, Discover, JCB, Mastercard, and Visa birthed PCI DSS version 1.0 in December 2004.</p><p class="text-node" id="a9d6" style="text-align: justify">Later in 2006, the Payment Card Industry Security Standards Council (PCI SSC) was formed by a joint venture of MasterCard, American Express, Visa, JCB International, and Discover Financial Services to manage PCI development and alignment of policies to PCI DSS. PCI SSC ensures that the entities are committed to secure credit card data.</p><p class="text-node" id="e699" style="text-align: justify">PCI DSS is now a globally recognized directive where every merchant who accepts card payments must comply with the latest version, PCI DSS 3.2.1, which was released in May 2018.</p><h2 class="heading-node" id="edca" style="text-align: justify">Why do merchants need to comply with PCI DSS?</h2><p class="text-node" id="f73f" style="text-align: justify">Since there are over multiple card transactions taking place in the market, a safe business environment becomes the prime concern for the merchants to lead a long haul. A business compliant with PCI DSS always earns customers’ trust for their sensitive card information and helps boost the sale and customer confidence. As every business relies on partners, acquirers, or fellow industry mates, being a PCI DSS Compliant helps improve one’s reputation and strategies.</p><p class="text-node" id="73e2" style="text-align: justify">Data breaches, payment card data theft, can be avoided as it is stored securely and monitored on a regular basis. In addition, PCI DSS even helps in improving IT infrastructure efficiency with its compliance levels and requirements.</p><h2 class="heading-node" id="de60" style="text-align: justify">PCI DSS Compliance levels</h2><p class="text-node" id="4b7a" style="text-align: justify">There are four levels of PCI DSS Compliance based on the number of annual payment card transactions a business handle.</p><p class="text-node" id="2109" style="text-align: justify"><strong>Level 1:</strong>&nbsp;over 6 million TXN</p><p class="text-node" id="c7ae" style="text-align: justify"><strong>Level 2:</strong>&nbsp;1 to 6 million TXN</p><p class="text-node" id="56fe" style="text-align: justify"><strong>Level 3:&nbsp;</strong>20,000 to 1 million TXN</p><p class="text-node" id="2b70" style="text-align: justify"><strong>Level 4:</strong>&nbsp;fewer than 20,000 TXN</p><p class="text-node" id="0b3b" style="text-align: justify">Check out our guide to the&nbsp;<a class="link au mj" href="https://m2pfintech.com/blog/pci-dss-a-quick-guide-to-its-levels/" rel="noopener">PCI DSS Levels</a>&nbsp;and their impact on compliance.</p><h2 class="heading-node" id="a8f1" style="text-align: justify">Requirements for PCI DSS Compliance</h2><p class="text-node" id="0da7" style="text-align: justify">Every system entity and component associated with Cardholder Data Environment (CDE) must comply with the PCI DSS mandate. It includes requirements for security management, policies, procedures, network architecture, software design, and other critical protective measures.</p><p class="text-node" id="c2c9" style="text-align: justify">PCI DSS sets forth 12 requirements for every PCI DSS complaint established by the PCI Security Standards Council:</p><h3 class="heading-node" id="757b" style="text-align: justify">1. Firewall Configuration</h3><p class="text-node" id="l8vfffrg7" style="text-align: justify">Firewalls are installed and configured to protect card holders’ data from any malware. It helps the prevention systems effectively to defend the hackers from unauthorized access to private data.</p><h3 class="heading-node" id="625d" style="text-align: justify">2. Password Security</h3><p class="text-node" id="2bd4" style="text-align: justify">Businesses should not use vendor-supplied defaults for system passwords and other security parameters in their routers, modems, point of sale (POS) systems, and other third-party products. Instead, basic precautions and configurations like changing the password should be followed as the public can easily access the generic passwords and security measures.</p><h3 class="heading-node" id="ad5f" style="text-align: justify">3. Protection of Cardholder Data</h3><p class="text-node" id="7c81" style="text-align: justify">The stored cardholders’ data must be encrypted with two-fold protection and certain algorithms. Also, the primary account numbers (PAN) must be regularly scanned and monitored to avoid any unencrypted data.</p><h3 class="heading-node" id="1dad" style="text-align: justify">4. Encryption of Transmitted Data</h3><p class="text-node" id="3d4b" style="text-align: justify">The cardholders’ data should be encrypted when transmitted across open, public networks like payment processors, home offices from local stores, etc. Sharing the account numbers to unknown locations must be avoided.</p><h3 class="heading-node" id="9653" style="text-align: justify">5. Antivirus Software</h3><p class="text-node" id="2cce" style="text-align: justify">All the systems used for interacting, sharing, storing PAN must be protected against malware by regularly using and updating antivirus software or programs. Also, POS providers must employ anti-virus measures and maintain up-to-date antivirus programs to prevent systems from malware.</p><h3 class="heading-node" id="f58e" style="text-align: justify">6. Secure Systems and Applications</h3><p class="text-node" id="3e7e" style="text-align: justify">To add another layer of protection to the data, the providers must develop and maintain secure systems and applications. These systems and applications that are used as the storage of data for interaction must be updated regularly.</p><h3 class="heading-node" id="f835" style="text-align: justify">7. Restriction of Access</h3><p class="text-node" id="714f" style="text-align: justify">The cardholders’ data are restricted to access by business need-to-know, and the sensitive data must be accurately documented and updated regularly.</p><h3 class="heading-node" id="bffa" style="text-align: justify">8. Unique Access ID</h3><p class="text-node" id="4eee" style="text-align: justify">Individual credentials and ID are assigned to each person with computer access to card holders’ data. Single access ID and password should not be used as it results in more vulnerability and slow response time.</p><h3 class="heading-node" id="57e9" style="text-align: justify">9. Restriction of Physical Access</h3><p class="text-node" id="fc45" style="text-align: justify">Card holders’ data must be physically stored in a secured location where any physical access is restricted. Physically written, typed, or digitally stored data must be secured in the room, and in case of any access, it should be added to the access logs.</p><h3 class="heading-node" id="7c0d" style="text-align: justify">10. Maintain Access Logs</h3><p class="text-node" id="c3c3" style="text-align: justify">As mentioned in the previous requirement, all access to network resources and cardholder data must be tracked and monitored in the access logs. This proper record keeping and documentation must be maintained with utmost accuracy as it is related to sensitive data.</p><h3 class="heading-node" id="aecf" style="text-align: justify">11. Testing Security Systems and Processes</h3><p class="text-node" id="1343" style="text-align: justify">Regularly testing/scanning security systems and processes result in less vulnerability as it involves many digital data, software programs/products, physical locations, etc.</p><h3 class="heading-node" id="625c" style="text-align: justify">12. Document Policies</h3><p class="text-node" id="726d" style="text-align: justify">Document policies that address information security for all personnel must be maintained right from storing to transmitting/using data after POS.</p><p class="text-node" id="h5c5kt21i" style="text-align: justify">So, with these twelve requirements, PCI DSS comprises six objectives to ensure optimal security for merchants who accept, process, transmit, or store payment card information.</p><p class="text-node" id="ziwy83q5i" style="text-align: justify"></p><img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/06/image-1.webp" alt="M2P Fintech" title="" id="jxi8l3syj" width="100%" height="253"><p class="text-node" id="6ievsj7e5" style="text-align: justify"></p><p class="text-node" id="gy2gvqh7y" style="text-align: justify">With PCI DSS’s strong objectives and compliance requirements, the security of the payment industry is strengthened. These measures help and encourage data security and facilitate the adoption globally. So, hereby businesses that handle card payments need to be a part of this global payment card data security solution and focus on increasing the intensity to move forward by becoming ‘PCI DSS Complaint.’</p><p class="text-node" id="b2cf" style="text-align: justify">Look forward to our upcoming blogs as we uncover PCI SSC’s other standards such as PCI 3 DS, PA DSS, PCI PIN Security, and PCI SSF.</p><p class="text-node" id="sm62lueof" style="text-align: justify"><a class="link" href="https://m2pfintech.com/newsletter/"><strong><em>Subscribe</em></strong></a><strong><em>&nbsp;to our newsletter and get the latest fintech news, views, and insights, directly to your inbox.</em></strong></p><p class="text-node" id="rh1sw0r2y" style="text-align: justify"><strong><em>Follow us on&nbsp;</em></strong><a class="link" href="https://www.linkedin.com/company/m2pfintech/mycompany/"><strong><em>LinkedIn</em></strong></a><strong><em>&nbsp;and&nbsp;</em></strong><a class="link" href="https://twitter.com/m2pfintech"><strong><em>Twitter</em></strong></a><strong><em>&nbsp;for insightful fintech tales curated for curious minds like you.</em></strong></p>

PCI DSS: The Payments’ Armour

<img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/06/Artboard-1-copy-8-3.webp" alt="M2P Fintech" title="" width="100%" height="358"><p class="text-node" id="rtqg79sw8" style="text-align: justify"></p><p class="text-node" id="rk4wnxc3z" style="text-align: justify">As technological advancements promote growth in our country, lack of financial literacy still prevails. In a recent incident, a farmer has reportedly lost his savings worth two lakhs to rats. He stored his money as cash in his house. The farmer wouldn’t have lost his savings if he was aware of a financial institution. The eradication of financial illiteracy and improving maximum financial inclusion help us overcome such situations.</p><h2 class="heading-node" id="45b6" style="text-align: justify">What is Financial Inclusion?</h2><p class="text-node" id="2445" style="text-align: justify">Financial inclusion aims to offer primary financial products and services to all individuals and businesses and makes these services more accessible and affordable.</p><p class="text-node" id="d2ba" style="text-align: justify">Financial institutions aim to offer basic services that include payments, transactions, savings, credit, and insurance sustainably to drive more financial inclusion. New technological innovations in fintech have caused organizations to offer cost-effective services to their customers.</p><h2 class="heading-node" id="fb52" style="text-align: justify">Measures to improve Financial Inclusion</h2><p class="text-node" id="7b22" style="text-align: justify">The Reserve Bank of India started taking measures in 2005 to improve financial inclusion in our country. The government initiated the National Mission for Financial Inclusion (NMFI), including Pradhan Mantri Jan Dhan Yojana (PMJDY), which provides services to unserved areas.</p><p class="text-node" id="a461" style="text-align: justify">Furthermore, the “Digital India” initiative, which provides accessible digital banking services with simplified formal verifications using unique identification (Aadhaar), is also a bold move towards improving financial inclusion in the country.</p><h2 class="heading-node" id="6804" style="text-align: justify">Fintechs boosting Financial Inclusion</h2><p class="text-node" id="eb6q533c9" style="text-align: justify">Indian fintechs are the biggest drivers of achieving financial inclusion, with an adoption rate of over 87%. In the recent decade, fintechs have widened operations to provide personalized services without opting for the traditional route. Also, the rise of the popularity of smartphones around the globe led to the establishment of new financial services. </p><p class="text-node" id="imf2s64xv" style="text-align: justify"><em>“As of February 2021, there is a record of 2.3 billion digital payment transactions made worth over 4 trillion rupees.”</em> </p><p class="text-node" id="1bk7zzoou" style="text-align: justify">From Demonetization in India to the Covid-19 outbreak, people are now more interested in using financial services such as digital payments, lending solutions, etc. Digital financial services help many small and medium-income businesses to offer cashless payments option to their customers.</p><blockquote class="block-node" id="wp01kwej7"><p class="text-node" id="hubql29h6" style="text-align: justify"><strong><em>According to an annual report for FY 2020–2021 by RBI, the volume of digital payments is at 453 crores in India.</em></strong></p></blockquote><p class="text-node" id="m4lotq2o5" style="text-align: justify">With increasing ideas and innovations, fintechs ensure more inclusion. With the growth in the industry, a wide range of products and services are set to enter the market to offer customized services. Products such as<a class="link" href="https://m2pfintech.com/blog/the-rise-of-digital-payments/"> digital payments</a>, digital credit, <a class="link" href="https://m2pfintech.com/blog/neo-banking-101-all-you-need-to-know/">neo banking</a>, <a class="link" href="https://m2pfintech.com/blog/api-the-power-that-drives-new-age-banking-ecosystems/">API banking</a>, <a class="link" href="https://m2pfintech.com/blog/prepaid-cards-101-a-definitive-guide-for-growth-and-profitability/">prepaid cards,</a> etc., have established effective financial inclusion.</p><h2 class="heading-node" id="acff" style="text-align: justify">What challenges do we face?</h2><ul class="list-node" id="30k5oemaa"><li><p class="text-node" id="96zck9jqf" style="text-align: justify">The excluded sections, such as rural, poor areas, often don’t have access to a financial institution and often approach moneylenders.</p></li><li><p class="text-node" id="58hum947r" style="text-align: justify">A constant need to improve financial literacy as many rural people have less or no awareness of financial institutions.</p></li><li><p class="text-node" id="98lazl405" style="text-align: justify">Lack of formal identification documents is also a significant challenge when people reach out to a financial service. Poor sections lack access to financial services, as they lack various documents such as proof of identification, birth certificate, etc.,</p></li><li><p class="text-node" id="yrjqc729a" style="text-align: justify">Even though people&nbsp;have a financial account, most users still prefer cash. Lack of trust and reliability prevents a customer from accessing the available financial services.</p></li><li><p class="text-node" id="rh1sm45el" style="text-align: justify">Gender inequality to access financial services as women pay higher interest rates than men.</p></li><li><p class="text-node" id="fgpsfrtat" style="text-align: justify">Low-income levels indulge in a myth that financial institutions only offer services to high and middle-income groups.</p></li><li><p class="text-node" id="5mhodeup7" style="text-align: justify">Some people are uncomfortable due to language barriers, formal documents, and the formalities that we go through before a financial transaction occurs.</p></li></ul><h2 class="heading-node" id="e955" style="text-align: justify">Overcoming the Challenges</h2><p class="text-node" id="1v0ojcfyb" style="text-align: justify">To alleviate the challenges faced by consumers, there arose a need to innovate new and simplified products. New technologies, fintech innovations, and the digital finance revolution have now become the constant drivers of financial inclusion. There is a constant growth in the sections of digital finance over traditional finance methods.</p><blockquote class="block-node" id="zr04eywdz"><p class="text-node" id="6e42c3x7l" style="text-align: justify"><strong><em>Digital Financial Inclusion ensures that the excluded and unserved population has digital access to financial services.</em></strong></p></blockquote><p class="text-node" id="n8vi45r4k" style="text-align: justify">Digital services focus on affordability, customer satisfaction, and sustainability. New digital platforms run by the institutions now accommodate small levels of cash flow. These services allow the low sections to make transactions, thus preventing the use of informal services. </p><p class="text-node" id="g89bcoz7d" style="text-align: justify">Understanding the potential and risks such as operational risks, financial crime risks, etc., while improving digital services can contribute to the growth of digital financial inclusion. Similarly, technological innovations have increased financial inclusion. These innovations aim to regain customers’ trust, rectify geographic and accessibility issues to bring in new consumers. </p><p class="text-node" id="o23xwottx" style="text-align: justify">Information technology, smartphone-enabled services have reduced the need for physical banks. With technological development, we can develop a rural information infrastructure that provides financial services to the underserved. </p><p class="text-node" id="32degype3" style="text-align: justify">Fintechs have also played a significant developmental role in achieving greater financial inclusion. Fintechs acts as a catalyst for financial inclusion as it creates more opportunities for the unbanked population. The shift of digital transactions from traditional transactions has improved self-employment, rural entrepreneurs, small borrowers, mediums, and enterprises. </p><p class="text-node" id="ttouhymxt" style="text-align: justify">Lack of financial awareness, high cost of traditional services, and other policy gaps were significant challenges while achieving financial inclusion. Fintech startups play a critical role in overcoming these challenges in the economic landscape. </p><p class="text-node" id="3pfmp8udx" style="text-align: justify">The tremendous growth in fintech has shown a positive shift as a report shows that 99.5% of consumers are now aware that they can transfer money and make payments with fintech platforms.</p><h2 class="heading-node" id="b97f" style="text-align: justify">Fintech products driving inclusion</h2><p class="text-node" id="aajf8uqcj" style="text-align: justify"> New fintech products have helped consistently in driving the financial inclusion of the country. As discussed earlier, these products allow the work of financial services and offer a streamlined process. These fintech products applied to reality are the main drivers of financial inclusion.</p><h3 class="heading-node" id="e38e" style="text-align: justify">Embedded Credit</h3><p class="text-node" id="vooeeboiu" style="text-align: justify"><a class="link" href="https://m2pfintech.com/blog/beginners-guide-to-embedded-lending/">Embedded credit</a> focuses upon integrating ‘lending as a feature’ in digital platforms. Customers receive their credit with the involvement of a familiar interface and eradicate the need for a third-party site. </p><p class="text-node" id="ew2hze04q" style="text-align: justify">Micro, small and medium enterprises (MSMEs) face difficulty offering small credits, increasing demand here. </p><p class="text-node" id="xqdn32rol" style="text-align: justify">The B2B e-commerce marketplaces provide the ultimate <a class="link" href="https://m2pfintech.com/blog/factors-and-psychology-behind-the-great-bnpl-allure/">BNPL (Buy Now, Pay Later)</a> option for the retailers while they checkout. BNPL offers these MSMEs to purchase on credit and pay later. BNPL is one of the fast-growing payment options which also helps MSMEs to expand their business. The BNPL would account for 3% of the global e-commerce spend by 2023. Thus, this system provides a convenient platform for consumers to experience new market products.</p><h3 class="heading-node" id="f250" style="text-align: justify">Digital Payments</h3><p class="text-node" id="751a" style="text-align: justify"><a class="link" href="https://m2pfintech.com/blog/the-rise-of-digital-payments/">Digital payments</a> (also called electronic payments) are the method we transfer one point value from one account to another using a digital device. Digital payments are end-to-end digital transactions, and also, they don’t require the usage of physical cards, thus reducing costs.</p><p class="text-node" id="9d8f" style="text-align: justify">For example, the latest introduction of <a class="link" href="https://m2pfintech.com/blog/e-rupi-indias-digital-upgrade-for-the-underbanked/">e-RUPI</a> which is a digital payment solution created by the Government of India to allow cashless payments. e-RUPI is powered by the National Payments Corporation of India (NPCI), and the one-time payment mechanism is easy, highly secure, and entirely confidential. The distributions are also made easy, safe, and contactless.</p><h3 class="heading-node" id="7d7d" style="text-align: justify">Neobanking</h3><p class="text-node" id="fa39" style="text-align: justify">Neobanking is an innovative method of approach in which financial institutions offer services without physical presence. <a class="link" href="https://m2pfintech.com/blog/top-14-neo-banks-that-reinvent-banking-experience-in-india/">Neo banks in India</a> operate on a low-cost model with minimal to zero monthly fees on deposits and withdrawals, and rock-bottom balance requirements. These drivers bring consumers and businesses across income levels into the fintech fold, fostering financial inclusion. Neo banking is highly famous among the millennials and Gen Z as they no longer use outdated processes. Neo banks use Artificial intelligence and machine learning to create a customer-centric Banking experience, with the aim to reduce human dependence.&nbsp;Neo banks provide millennials and Gen Z their own customized product set, making the process fuss-free. Millennials and Gen Z prefer simplified and easy- manageable finances, thus proving neo banks are a blessing in disguise.<a class="link" href="https://m2pfintech.com/blog/7-steps-to-start-a-neo-bank-from-scratch/"> Curious to know how you can start a neo bank? Check out these 7 steps.&nbsp;</a></p><h3 class="heading-node" id="3aa0" style="text-align: justify">API Banking</h3><p class="text-node" id="a644" style="text-align: justify"><a class="link" href="https://m2pfintech.com/blog/api-the-power-that-drives-new-age-banking-ecosystems/">API Banking</a> provides better means to share data, helps in integrating systems, and makes services more personalized. In API banking, tailor-made products improve the overall customer experience.</p><p class="text-node" id="a0e8" style="text-align: justify">With the help of API banking, new fintech innovated products offer features and services aligned to provide flexible services. Innovations in API banking have reduced costs and now made it economical for the unbanked and underserved as they can now experience better products and services.</p><h3 class="heading-node" id="921d" style="text-align: justify">Open Banking</h3><p class="text-node" id="pcdgfchfq" style="text-align: justify">To offer better services, open banking offers third-party financial service providers access to financial data with the help of APIs. <a class="link" href="https://m2pfintech.com/blog/open-banking-a-primer-2/">Open banking</a> is highly prevalent in Europe. Open banks help achieve more financial inclusion as it allows small, medium businesses access particular tools and services that target the needs of their consumers. Innovations in open banking and the experimentation of products can foster higher financial inclusion in the long run.</p><h3 class="heading-node" id="9d8d" style="text-align: justify">Prepaid Cards</h3><p class="text-node" id="9bf1" style="text-align: justify"><a class="link" href="https://m2pfintech.com/blog/prepaid-cards-101-a-definitive-guide-for-growth-and-profitability/">Prepaid cards</a> help us process payments quickly as we have better cash flow management, easy reimbursements, and more security than cash or cheques. They are a super alternative to carrying cash around. They are available as gift cards, meal cards, and also as travel cards. Prepaid cards are a great way to control business expenses, improve efficiencies and generate revenue streams.&nbsp; However, the time, cost and effort involved in card issuance in-house are huge.</p><p class="text-node" id="00l7dyg1c" style="text-align: justify">The best way to manage card issuance is by <a class="link" href="https://m2pfintech.com/blog/why-should-apis-be-your-holy-grail-for-prepaid-card-issuance/">deploying the right APIs.</a></p><h3 class="heading-node" id="ee0a" style="text-align: justify">Mobile Wallets</h3><p class="text-node" id="caf1" style="text-align: justify"><a class="link" href="https://m2pfintech.com/blog/how-to-implement-the-best-prepaid-payment-instrument-ppi-for-your-business/">Mobile wallets</a> are famous and convenient due to their accessibility. Transactions are made easy as we can send, receive and store money easily with the help of our smartphones. In reality, right from a vegetable vendor to corporate and digital firms, every one of us can easily transact if we have a mobile wallet.</p><p class="text-node" id="55e7" style="text-align: justify">Mobile wallets ensure that every person can participate in a financial transaction with its cashless and contactless technologies. The whole process boosts the economy while achieving more financial inclusion.</p><p class="text-node" id="0de3" style="text-align: justify">The future ideas of the fintech industry will result in product innovations while improving existing ones, thereby offering more affordable and accessible services to both the unbanked and underbanked. Furthermore, the coupling of fintech and financial institutions will help eradicate financial illiteracy and promote financial inclusion. With the acceleration of fintech and its budding ideas, the future of financial inclusion is bright and holds many opportunities that come with new beginnings.</p><p class="text-node" id="m4rqw7i43" style="text-align: justify">Need more info on how fintech can help you? Write to us at <a class="link au mg" href="mailto:business@m2pfintech.com" target="_blank" rel="noopener ugc nofollow">business@m2pfintech.com</a>.</p><p class="text-node" id="hkoolzf98" style="text-align: justify"><a class="link" href="https://m2pfintech.com/newsletter/"><strong><em>Subscribe</em></strong></a><strong><em>&nbsp;to our newsletter and get the latest fintech news, views, and insights, directly to your inbox.</em></strong> </p><p class="text-node" id="v55sozo4s" style="text-align: justify"><strong><em>Follow us on&nbsp;</em></strong><a class="link" href="https://www.linkedin.com/company/m2pfintech/mycompany/"><strong><em>LinkedIn</em></strong></a><strong><em>&nbsp;and&nbsp;</em></strong><a class="link" href="https://twitter.com/m2pfintech"><strong><em>Twitter</em></strong></a><strong><em>&nbsp;for insightful fintech tales curated for curious minds like you.</em></strong></p>

Fintech- A Catalyst for Financial Inclusion

Six Profitable BNPL Business Models to Unlock Infinite Value

<img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/05/Artboard-1-copy-8-4.webp" alt="M2P Fintech" title="" width="100%" height="284"><p class="text-node" id="bggcildae"> This August, meet our very own AVP- Implementation Specialist, Jayanthi, who is skilled at balancing mom-work life. Jayanthi loves listening to fast-paced Tamil songs and is a secret lyricist. She also shares how she misses M2P’s filter coffee. Read on to know more about Jayanthi and how she brings her best every day.</p><h2 class="heading-node" id="eab4">What happens in your typical workday at M2P?</h2><p class="text-node" id="ad92">Being part of the implementation team, I will primarily plan the client requirements and sort out the production issues. Later, I work on resolving them on a priority basis and organize my work calls/emails.</p><p class="text-node" id="e315">I focus on programs assigned to me by monitoring clients’ processes, rectifying the queries, and completing procedures that ensure a smooth process. Before EOD, I ensure that all queries get resolved, and the client is updated on the progress.</p><h2 class="heading-node" id="7f7f">How do you balance mom-work life?</h2><p class="text-node" id="720a">It is tricky to manage both.</p><p class="text-node" id="fc82">My son is nearly two years old; he often comes into my room and sits on my lap, wondering whom I am talking to. As I am currently working from home, I am able to sneak off some time to play with my son or make him eat the veggies. Once, he tried to push off the laptop as I did not give him my attention. From then, I make sure I pay enough attention as soon as he enters the room with a warning by shouting “Yeyyy.”</p><h2 class="heading-node" id="011a">How would you describe your journey with M2P?</h2><p class="text-node" id="ddde">In M2P, I see every day as a new, fresh, and fun-filled day. The journey started five years back in a house, and now we have grown into office buildings.</p><p class="text-node" id="abe9">When I started working here, my focus would be client calls which I struggled in the initial days due to my communication gap. But I overcame the communication issues with my colleagues’ motivation and learned to communicate better with our clients. So now, I focus on rectifying the blocks and motivating myself to become the best of myself.</p><h2 class="heading-node" id="uehsit7hd">How does before and after pandemic work differ for you?</h2><p class="text-node" id="0656">Doing work from home has improved communication with my family. But I miss the interactions with my teammates; when seated at the office, to my back was Lekha’s desk, to my side Vasanth, and on the opposite, Prabhu will be there. Also, I miss M2P’s filter coffee that we used to have in the evening breaks.</p><p class="text-node" id="040f">Working from home requires balancing both home and office, so I usually schedule my work not to overlap. In WFH, even though it’s just the device surrounding us, it allows me to work more focused. As I’m a person who analyzes and operates more efficiently when I am alone, this pandemic has definitely improved my work style.</p><h2 class="heading-node" id="cc3d">Any favorite moments with M2P?</h2><p class="text-node" id="8a3a">Every day that I work with M2P is new and different, and there are boatloads of memories that I cherish every day. Once, we had a situation where two hundred cards had an error, and they were shuffled within the consignment of one lakh cards. The situation was a block as it was very challenging to find the cards. But I worked hard on it and retrieved the error cards out of the lot. Everyone appreciated my grit to find those 200 hundred error cards, and I was elated to receive the appreciation afterward.</p><p class="text-node" id="e4d4">Earlier, when we were a small team, every Friday we used to go for lunch in a restaurant — one of the moments which I will never forget.</p><h2 class="heading-node" id="a112">What is your post-pandemic plan?</h2><p class="text-node" id="lv6e95eu1">I have always wanted to travel around if I get the time. I would like to travel to different states like go for a tour of India. I like visiting lush green places like Kerala, Kodaikanal, so I wish to see these peaceful places. Post-pandemic, I am excited to go to the office and work and have M2P’s filter coffee back there with my colleagues.</p><h2 class="heading-node" id="c1f7">What do you do when you get some leisure time?</h2><p class="text-node" id="xpp4tyivt">I love listening to fast-paced songs and write poems about my mom whenever I find the time. I start my day by getting into the kitchen to make tea while listening and dancing to songs. I feel relaxed and fresh when listening to songs with my cup of positivi-tea. Then, I spend the rest of the available time with my family.</p><h2 class="heading-node" id="ab60">Anything that your colleagues don’t know about you?</h2><p class="text-node" id="mbjyk7qyu">I’m very affectionate to people around me and also a silent person at times. I always write poems, but most people don’t know that. I love to sing; when I was in school, I took part in music competitions where I write my lyrics with existing tunes. In 10th grade, I rewrote the ‘Edho oru paatu’ song to lyrics referring to my school memories and got first place in the competition.</p><h2 class="heading-node" id="481b">Anything else you want to share with M2P?</h2><p class="text-node" id="3e7e">I think that every one of us together here makes M2P a family, and I consider M2P to be my second home since I started my career here. I feel grateful for all my experiences and the knowledge I learned from everyone, as they have constantly motivated me throughout my career. M2P has helped me move forward to give out my best.</p><p class="text-node" id="hrhylbq85"><a class="link" href="https://m2pfintech.com/newsletter/"><strong><em>Subscribe</em></strong></a><strong><em>&nbsp;to our newsletter and get the latest fintech news, views, and insights, directly to your inbox.</em></strong> </p><p class="text-node" id="i3p6i5ts7"><strong><em>Follow us on&nbsp;</em></strong><a class="link" href="https://www.linkedin.com/company/m2pfintech/mycompany/"><strong><em>LinkedIn</em></strong></a><strong><em>&nbsp;and&nbsp;</em></strong><a class="link" href="https://twitter.com/m2pfintech"><strong><em>Twitter</em></strong></a><strong><em>&nbsp;for insightful fintech tales curated for curious minds like you.</em></strong></p>

Meet Jayanthi — Our Implementation Specialist

<img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/04/banner-1.webp" alt="M2P Fintech" title="" width="100%" height="383"><p class="text-node" id="4fd0">Sara usually travels around the globe for her official trips quite frequently, and she enjoys shopping at local shops to bring back memorabilia for colleagues and family. Nairobi was on her frequent travel list, and she loves to shop the local markets for their rich handicrafts. The popular currency formats in Nairobi were either M-Pesa or Nairobi Shillings.</p><p class="text-node" id="78d3">However, carrying local currency is not a good idea, and M-Pesa requires a local account and sim card for starters. At the same time, using international debit or credit cards will attract too many charges.</p><p class="text-node" id="ea8f">That’s when Forex Cards came to the rescue.</p><p class="text-node" id="078b">With single or multiple currencies in one card that has safety and comfort as it is a core feature, forex cards were the best solution Sara could ask for, making her travel much easier.</p><h2 class="heading-node" id="60d6"><strong>So, what is a Forex card?</strong></h2><p class="text-node" id="262c">A forex card can hold single or multiple currencies in a single card, prepaid by nature. It is a globally accepted prepaid card with features of ATM withdrawal, just like a debit/credit card. Therefore, it is a safer and fool-proof way of managing finances abroad, be it for professional or personal travel.</p><h2 class="heading-node" id="fd11"><strong>Types of Forex cards</strong></h2><p class="text-node" id="21cb">Forex cards come in various types, and they can be chosen as per the traveler’s requirement. The forex cards are typically differentiated as:</p><h3 class="heading-node" id="537f">Single-Currency Forex card</h3><p class="text-node" id="b2b6">This card holds a single international currency and is usually available when travelers only intend to visit one country. Furthermore, if the traveler tries to transact in any other currency other than the preloaded currency, they will end up paying high conversion charges along with markup fees and additional applicable charges.</p><h3 class="heading-node" id="06ae">Multi-Currency Forex card</h3><p class="text-node" id="244f">Best suited for globetrotters, this type of prepaid forex card allows the user to carry multiple international currencies in one card.</p><h3 class="heading-node" id="b841">Student Forex card</h3><p class="text-node" id="f6fc">This type of forex card is specifically designed for the new adults embarking on their maiden financial journey on account of their studies. It also doubles up as an identity card known as International Student Identity Cards (ISIC cards). Student forex cards also offer student discounts and can help primarily help in managing living expenses abroad.</p><h2 class="heading-node" id="7423"><strong>How does a Forex card work?</strong></h2><p class="text-node" id="1811">Like a debit/credit card application, the traveler needs to apply for a forex card with the bank or forex service provider. Once the application goes through, the applicant can load their desired currency of GBP, USD, SGD, EUR, and others in the card.</p><p class="text-node" id="985e">Also, certain documents need to be submitted when applying for forex cards:</p><ul class="list-node" id="1689ax4q6"><li><p class="text-node" id="n5srhjvux">Forex card application</p></li><li><p class="text-node" id="fhums18at">Self-attested copies of Visa and Passport</p></li><li><p class="text-node" id="j3fub735r">Copy of confirmed air tickets of the visiting countries</p></li><li><p class="text-node" id="4onfh842o">The usual attachments of Identity and Address proof</p></li></ul><p class="text-node" id="5b2a">If the traveler is a student, they need to submit some additional documents like:</p><ul class="list-node" id="7zz3nxzh8"><li><p class="text-node" id="c20cgosxc">Admission letter</p></li><li><p class="text-node" id="utdxd4tnv">University Identity card or</p></li><li><p class="text-node" id="jy4bar3gj">Letter of appointment</p></li></ul><p class="text-node" id="b316">Post these documents verification, the forex card gets approved, and it will be either shipped to the applicant’s address, or they can pick the card up from their choice of branch.</p><p class="text-node" id="fcc3">The traveler can load the card as per their choice of currency by issuing a standing instruction to the service provider. They can specify the international currencies they want along with the amount in each of the currencies. If the currency conversion happens via a bank, their bank account will be automatically debited, and their multi-currency card will be loaded.</p><p class="text-node" id="de6a">If it is a forex service provider, the traveler can load the card using the issuer’s <a class="link" href="https://m2pfintech.com/blog/what-is-a-payment-gateway-and-payment-switch-understanding-the-basics-of-payments-architecture/">payment gateway.</a> Then, they can make the payment by using the standard options of debit card, credit card, net banking, etc.</p><p class="text-node" id="4569">At the same time, forex cards also carry a certain number of charges that may differ depending upon the issuer. Some of the common charges are cash withdrawal, balance inquiry, SMS alerts, cross-currency mark-up charges, etc.</p><p class="text-node" id="2381">Even though forex cards come with their share of charges, they still reign supreme over other payment methods like debit cards, credit cards, or travelers cheques. And the popular opinion claims that forex cards are a much better option when compared against these instruments.</p><h2 class="heading-node" id="bcc0"><strong>Advantages of Forex cards over Debit/Credit cards</strong></h2><h3 class="heading-node" id="97c7">ATM withdrawal fee</h3><p class="text-node" id="855e">Forex cards have set ATM withdrawal fee that is usually lower than credit/debit cards, and they are now accompanied by conversion fee as well.</p><p class="text-node" id="d57b">Debit/Credit cards come with a withdrawal fee plus a markup fee of 1% to 3% and currency conversion charges. While it may differ between card issuers, the charges remain significantly higher than using a forex card.</p><h3 class="heading-node" id="9eda">Transaction charges</h3><p class="text-node" id="20a8">Swiping prepaid forex cards doesn’t levy extra transaction charges as the local currency is used for the transaction.</p><p class="text-node" id="fb8d">Swiping a debit/credit card will attract extra charges as the foreign currency will be converted to the local currency and then will be charged to the traveler’s account. Furthermore, it will attract a markup fee along with other applicable tax charges.</p><h3 class="heading-node" id="745d">Exchange Rates</h3><p class="text-node" id="14e1">In forex cards, exchange rates are well locked in advance, which protects the traveler from fluctuations in the exchange rate.</p><p class="text-node" id="4981">There is no exchange rate lock, and the value of the rupee often fluctuates against most of the international currencies in debit or credit cards.</p><h3 class="heading-node" id="4562">Temptation</h3><p class="text-node" id="73a2">Forex cards curbs the temptation to overspend while overseas as it is a prepaid card and comes with an already set limit.</p><p class="text-node" id="6bac">Credit cards come with an overdraft facility that will tempt the traveler to overspend and end up with a huge bill.</p><h2 class="heading-node" id="1f24"><strong>Advantages of Forex card over Cash</strong></h2><h3 class="heading-node" id="400f">Better exchange rates</h3><p class="text-node" id="f954">Forex cards come with better exchange rates when compared to cash conversion. Also, the traveler gets to enjoy locked-in exchange rates that do not fluctuate on a daily basis.</p><h3 class="heading-node" id="6a8f">Safety</h3><p class="text-node" id="9d04">Cash is only safe when it is stored in a vault, and it creates an inconvenience when carried in huge amounts, whereas a forex card is a CHIP and PIN enabled card that offers top-of-the-line security to the traveler.</p><h3 class="heading-node" id="5b55">Theft</h3><p class="text-node" id="5ed1">In case of cash theft, there is no possible way to get the money back nor reclaim damages. But in case of forex card theft, the traveler can immediately block the card and request a replacement card, no matter their geographical location.</p><h3 class="heading-node" id="568d">Multi-currency</h3><p class="text-node" id="bbdd">It is practically impossible to carry around wads of cash in different currencies as it is neither safe nor smart to walk around with cash. It is a hassle to keep and use the right currency without the confusion around the country’s native currency. Whereas when using a forex card, the card will automatically detect the country and carry out transactions using the preloaded local currency.</p><h2 class="heading-node" id="cfd4"><strong>Advantages of Forex cards over traveler’s cheques</strong></h2><h3 class="heading-node" id="6c46">Modernized version</h3><p class="text-node" id="4d8d">Forex cards are the software upgrade of traveler’s cheques. They are widely used and come with convenience and comfort at their core. Traveler’s cheques are antique, primarily out of use, and are not accepted worldwide anymore.</p><h3 class="heading-node" id="6875">Associated Fees</h3><p class="text-node" id="ff53">Both forex cards and travelers cheques come with their share of fees and charges. But travelers cheques are a bit on the higher side as they involve traveler cheque creation and encashment plus the usual charges.</p><h3 class="heading-node" id="714c">Handling</h3><p class="text-node" id="e368">Forex cards are easy and convenient to handle; all it takes is a swipe for a transaction and a few clicks to customize the card. Whereas traveler’s cheques are outdated and hold no meaning in the world of <a class="link" href="https://m2pfintech.com/blog/the-rise-of-digital-payments/" target="">digital payments</a>.</p><h2 class="heading-node" id="b53b"><strong>Why a Forex card?</strong></h2><p class="text-node" id="7bd9">While Forex cards do allow for frictionless travel, they also come with a host of other benefits such as:</p><p class="text-node" id="2e8b">It is the safest form of carrying cash, and they are PIN-protected prepaid cards. For example, M2P’s Forex cards enable a traveler to load up to 24 currencies in one card, and it also comes with an app that offers a virtual wallet.</p><p class="text-node" id="7b27">They also come with an app feature. For example, <a class="link" href="https://m2pfintech.com/">M2P’s</a> digital travel money app offers the feature of configuring spending limits, channels and block/unblock the card. The traveler can lock in the exchange rates, and buying a forex card is cheaper than cash currency conversion. Also, it saves them fluctuating rates when using debit/credit cards.</p><p class="text-node" id="ed8d">The traveler can save on transaction fees typically charged by debit and credit cards. They range from 2% to 5% and are coupled with markup fees, applicable taxes, and so on.</p><p class="text-node" id="77f3">It can be reloaded from any part of the globe and access a 24/7 customer support team. Travel cards are predominantly accepted everywhere without additional charges.</p><p class="text-node" id="674c">Also, many issuers allow the auto-sweep feature when one currency in a multi-currency wallet goes low. For example, M2P will transfer funds from the GBP wallet to the USD wallet if the wallet balance becomes low when initiating a purchase. It doesn’t require any additional confirmations from the user, and they can easily transact at their preferred platform.</p><p class="text-node" id="06a5">It also comes with an ATM feature and can be used in any Visa or MasterCard terminal. Upon return, the balance currency can be converted back into INR without any hassle. Most often, the issuers also offer travel insurance cover along with the forex card.</p><p class="text-node" id="aac7">Gone are the days when foreign travel mandated carrying around cash hidden inside the layers of dress and goodies as a safety precaution. With the travel ban slowly being eased in many countries across the world and with M2P’s multi-currency forex cards as a travel companion, today’s globetrotters can enjoy secure and hassle-free travel.</p><p class="text-node" id="k51ig3r1v"><a class="link" href="https://m2pfintech.com/newsletter/"><strong><em>Subscribe</em></strong></a><strong><em>&nbsp;to our newsletter and get the latest fintech news, views, and insights, directly to your inbox.</em></strong></p><p class="text-node" id="nqb5m8trz"><strong><em>Follow us on&nbsp;</em></strong><a class="link" href="https://www.linkedin.com/company/m2pfintech/mycompany/"><strong><em>LinkedIn</em></strong></a><strong><em>&nbsp;and&nbsp;</em></strong><a class="link" href="https://twitter.com/m2pfintech"><strong><em>Twitter</em></strong></a><strong><em>&nbsp;for insightful fintech tales curated for curious minds like you.</em></strong></p>

Forex cards- International travel made effortless

<img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/04/Artboard-1-copy-8-3-1.webp" alt="M2P Fintech" title="" width="100%" height="383"><p class="text-node" id="qp0v0n2ax" style="text-align: justify"></p><p class="text-node" id="ngcrm790y" style="text-align: justify">Did you know?</p><p class="text-node" id="6681" style="text-align: justify">PPIs in India grew at a 53% CAGR from 41Cr (May 2017) to 226Cr (May 2021). And the potential for future growth is enormous.</p><p class="text-node" id="48cc" style="text-align: justify">New to the PPI world?</p><p class="text-node" id="7e3b" style="text-align: justify">Here’s a little introduction for you.</p><p class="text-node" id="1076" style="text-align: justify">PPIs are prepaid payment instruments that enable <a class="link" href="https://m2pfintech.com/blog/the-rise-of-digital-payments/" target="">digital payments</a> via mobile wallets, <a class="link" href="https://m2pfintech.com/blog/prepaid-cards-101-a-definitive-guide-for-growth-and-profitability/">prepaid cards,</a> and paper vouchers. They are disruptive business enablers with the ability to accelerate the profitability and growth of enterprises worldwide.</p><p class="text-node" id="bbdf" style="text-align: justify">But how can you tap into the potential of PPIs?</p><p class="text-node" id="afd8" style="text-align: justify">First, you need to understand the dynamics behind PPIs. The infographic below will help you grasp and analyze the evolution of PPIs in India from the era of demonetization to the pandemic. You can tap into its immense potential by comprehending growth factors, current status, thriving possibility, RBI initiatives, and much more.</p><img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/06/PPI-1-aug-11.webp" alt="M2P Fintech" title="" id="xbufzjb8z" width="100%" height="1774"><img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/06/PPI-2-aug-11.webp" alt="M2P Fintech" title="" id="46kompytm" width="100%" height="2165"><img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/06/PPI-3-aug-11.webp" alt="M2P Fintech" title="" id="fjn663498" width="100%" height="2085"><p class="text-node" id="8xe40l0o9" style="text-align: justify"></p><p class="text-node" id="11gwal68v" style="text-align: justify">Email us at<strong>&nbsp;</strong><a class="link au lg" href="mailto:ping@m2pfintech.in" target="_blank" rel="noopener ugc nofollow"><strong>ping@m2pfintech.in</strong></a>&nbsp;to issue customized prepaid cards and wallets incredibly fast.</p><p class="text-node" id="u0ekj96q1" style="text-align: justify"><a class="link" href="https://m2pfintech.com/newsletter/"><strong><em>Subscribe</em></strong></a><strong><em>&nbsp;to our newsletter and get the latest fintech news, views, and insights, directly to your inbox.</em></strong></p><p class="text-node" id="l5dahq8no" style="text-align: justify"><strong><em>Follow us on&nbsp;</em></strong><a class="link" href="https://www.linkedin.com/company/m2pfintech/mycompany/"><strong><em>LinkedIn</em></strong></a><strong><em>&nbsp;and&nbsp;</em></strong><a class="link" href="https://twitter.com/m2pfintech"><strong><em>Twitter</em></strong></a><strong><em>&nbsp;for insightful fintech tales curated for curious minds like you.</em></strong></p>

Disruptive business enablers -Prepaid Payment Instruments (PPIs)

<img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/04/banner-1251.webp" alt="M2P Fintech" title="" id="pwxzxj8z1" width="100%" height="661"><p class="text-node" id="9af2" style="text-align: justify">A few years ago, banking was always considered an arduous task with its complexity. But now, when we think of banking, ‘digital transaction’ springs up to our minds immediately, which makes our job simpler. Thanks to Neo banks, it redefines banking in the most user-friendly way and makes it more popular in recent years. Ergo, many customers now prefer using fingers for banking rather than their feet to visit the brick-and-mortar banks.</p><p class="text-node" id="52a1" style="text-align: justify">Why such hype for Neo banks?</p><p class="text-node" id="8c33" style="text-align: justify">What makes it stand out in the banking sector?</p><p class="text-node" id="d6f9" style="text-align: justify">We have unraveled everything you need to know about Neo banks in this blog. So, let’s get started right away.</p><h2 class="heading-node" id="299c" style="text-align: justify">What is a Neo Bank?</h2><p class="text-node" id="8zmlb2n3a" style="text-align: justify">Neo Bank is a type of digital bank that works entirely online without a physical branch. It is a customer-focused banking sector that attracts present-day tech-savvy users. They are also recognized as fintech that is demystifying the financial ecosystem actively. </p><p class="text-node" id="roa9zz2fh" style="text-align: justify">With Neo banks’ advanced features, the users can manage money wisely by using only their mobile phones. Moreover, compared to traditional banks, neo banks offer cheaper and faster banking services that include money transfers, lending, mobile-first financial solutions, and many more.</p><h2 class="heading-node" id="8b98" style="text-align: justify">Three working modes of Neo Banks</h2><p class="text-node" id="8l22t4opq" style="text-align: justify">Though Neo banks appear to be an app that controls financial services, the working is differentiated into three modes.</p><h3 class="heading-node" id="c677" style="text-align: justify"><strong>(i) Partners with Traditional banks</strong></h3><p class="text-node" id="4k0lpy4gm" style="text-align: justify">It is a&nbsp;<strong>front-end focused</strong>&nbsp;neo bank which does not carry a banking license on its own and partners with a traditional bank to offer a wide range of core banking services. These types of neo banks include non-licensed fintech companies affiliated with existing licensed banks that offer seamless services and products for the bank’s customers. This collaboration ensures banks as their partner and not their opponent.</p><h3 class="heading-node" id="b6a7" style="text-align: justify"><strong>(ii) Bank’s Digital Avatar</strong></h3><p class="text-node" id="9e0e" style="text-align: justify">Here, the traditional banks develop their own digital-only initiative like neo banks to offer their services more digitally to their customers. They also go on par with the technology advancements to launch neo banking services. The banks that offer digital services through online portal comes under this category of neo banks.</p><h3 class="heading-node" id="c67b" style="text-align: justify"><strong>(iii) Neo Banks with a digital banking license</strong></h3><p class="text-node" id="3xwtmy8cx" style="text-align: justify">They are called a&nbsp;<strong>Full-Stack&nbsp;</strong>neo bank that works only in countries that approve stand-alone digital entities and acquire a license from the Central Bank or the corresponding authority.</p><h2 class="heading-node" id="8e50" style="text-align: justify">Neo Banks Vs. Digital Banks Vs. Traditional Banks</h2><p class="text-node" id="a4b07nic1" style="text-align: justify">Banking is now a field where people are offered a lot of options to choose from. There are different kinds of banks that offer different services and qualities. The below image brings out the characteristics between three popular banks — <a class="link" href="https://m2pfintech.com/blog/neo-banking-the-rise-of-new-age-banking/">Neo Banks</a>, Digital Banks, and Traditional Banks.</p><img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/04/int.webp" alt="M2P Fintech" title="" id="69y0499an" width="100%" height="529"><p class="text-node" id="6973" style="text-align: justify">As the name says, traditional banks are the oldest of all with the most trustworthy customer relationship. They also specialize in a wide range of services and products but with tons of paperwork and, at times, online data, which demands extremely long wait times. But nowadays, traditional banks have also adopted digital tools like e-mail, SMS, application, website, etc.</p><p class="text-node" id="fab1" style="text-align: justify">The next entrant is the digital banks, which are similar to Neo banks since they also offer banking services online. To simply put, they are traditional banking with a digital touch that allows users to manage finance 24/7 via an electronic/online platform. Digital banks eliminate customers’ visits to physical bank branches and automate traditional banking services with no paperwork. They uplift traditional services with a simple equation —&nbsp;<strong>Online Banking + Mobile Banking = Digital Banking.</strong></p><p class="text-node" id="btjquow0d" style="text-align: justify">As you can see, Neo bank is an upgraded version that suits the present-day banking needs digitally and is user-friendly. Neo banks stand out with their simplified customer-centric banking approach with wise financial management. Users are satisfied with their 100% quick and easy digitized services with anywhere anytime accessibility, making them the most profitable business model.</p><h2 class="heading-node" id="9b30" style="text-align: justify">What makes Neo banks a lucrative fintech offering?</h2><p class="text-node" id="c6ar2t45q" style="text-align: justify">Neo banks are one of the profitable business models that emerged in the recent few years. With their ingenious services, these financial institutions are hitting the jackpot in ways that benefit themselves and their users. The below-listed features substantiate neo banks’ success:</p><ul class="list-node" id="kzvx0pa02"><li><p class="text-node" id="g5bwvwk7r" style="text-align: justify">Fewer fees and faster banking services make it more popular and cost-effective even among underbanked sectors.</p></li><li><p class="text-node" id="negvifl8b" style="text-align: justify">Neo bank is a customer-centric banking avatar as they automate services according to their users’ preferences.</p></li><li><p class="text-node" id="i5myia0xl" style="text-align: justify">They blend emerging technologies like Artificial Intelligence and Machine Learning to end the tedious banking process.</p></li><li><p class="text-node" id="ucwzqgjhv" style="text-align: justify">Customers enjoy various financial services like account creation, international transactions, or any services, quicker at any time and any place.</p></li><li><p class="text-node" id="824eyu9a5" style="text-align: justify">AI and data insights-driven app that tracks every transaction and generates reports as per user’s requirements.</p></li><li><p class="text-node" id="3u1ekfp63" style="text-align: justify">Smart saving and Investment options are now possible with just a smartphone.</p></li><li><p class="text-node" id="153vbjuqi" style="text-align: justify">Neo banks act as a digital crust, making the core banking services crisper and accessible for their users.</p></li><li><p class="text-node" id="gz0yn0ovu" style="text-align: justify">They fill the digital gap and enable traditional banking services to Gen Z.</p></li><li><p class="text-node" id="d7qpfv9l2" style="text-align: justify">Collecting and analyzing data to give their users highly personalized and customized services.</p></li></ul><p class="text-node" id="n4wl6kp5k" style="text-align: justify">As a result, banking turned smarter with neo banks and easily reached out to unbanked and underbanked sectors. It also impacts banking today and tomorrow with its unmatchable digitized financial services.</p><h2 class="heading-node" id="smmjd1o8d" style="text-align: justify">Neo bank and its rising popularity</h2><p class="text-node" id="05ef" style="text-align: justify">The Covid-19 pandemic was the main reason which triggered its popularity when people were concerned about physical cash for safety reasons. People were more exposed to digital banking, which made brick and mortar banks have a healthy collaboration with neo banks. Their out-of-the-box strategies gave sudden popularity for neo banks.</p><p class="text-node" id="2b56" style="text-align: justify">Starting from targeting the Gen-Z audience with product marketing, neo banks focus on the end-user experience by tailoring their User Interface to give the best possible user experience. Also, the customer gets to enjoy a better interest rate minus the need for lengthy paperwork.</p><p class="text-node" id="ze8liv4kx" style="text-align: justify">Furthermore, neo-banks have the ability to offer services based on popular customer opinion, and they further improve the stickiness by tailoring the services individually. When customers feel their opinions are being heard and fulfilled, they stick with the service provider. Neo banks now deploy this strategy to target specific audiences.</p><p class="text-node" id="7366" style="text-align: justify">These digital-only banks are ruling the banking space since 2017 with their innovative strategies and methods. We have&nbsp;Finin&nbsp;India’s first consumer-facing neo bank, fueled by our own <a class="link" href="https://m2pfintech.com/">M2P’s</a> API, which gives users a better track of their finances. Finin offers features like a detailed break-up of user spending and completely digital services with high bank-level security.</p><p class="text-node" id="185dktw2b" style="text-align: justify">Backed by banking licenses of the traditional banks, neo banks are adding increasing value by the day to the financial ecosystem; in fact, they can be termed as the new-age banks of today.</p><h2 class="heading-node" id="1101" style="text-align: justify">Turning stumbling blocks into stepping stones</h2><p class="text-node" id="6790" style="text-align: justify">Even though it is one of the profitable business models in the industry, challenges are to everyone. Neo banks have limited banking services and products, unlike traditional banks, since they are relatively new. Indeed, we could see this challenger bank with a wide range of products and services in few years.</p><p class="text-node" id="d399" style="text-align: justify">Traditional banks being a string participant for decades with unbeatable trust relationships with their customers, neo banks find it difficult to gain trust. But, with collaboration with traditional banks, they are definitely coming up with great strategies and services to establish as a trustable one among customers.</p><p class="text-node" id="34cb" style="text-align: justify">Neo banks are withstanding in this ambitious field with many robust financial institutions around. Every entrant, including traditional banks, would have faced their stumbling blocks and crisis, which led to the products and services we enjoy now. So, neo banks being an active player is turning every stumbling block into a stepping stone in its way.</p><p class="text-node" id="vu127bt9k" style="text-align: justify"><a class="link" href="https://m2pfintech.com/newsletter/"><strong><em>Subscribe</em></strong></a><strong><em>&nbsp;to our newsletter and get the latest fintech news, views, and insights, directly to your inbox.</em></strong> </p><p class="text-node" id="gmcmhlylk" style="text-align: justify"><strong><em>Follow us on&nbsp;</em></strong><a class="link" href="https://www.linkedin.com/company/m2pfintech/mycompany/"><strong><em>LinkedIn</em></strong></a><strong><em>&nbsp;and&nbsp;</em></strong><a class="link" href="https://twitter.com/m2pfintech"><strong><em>Twitter</em></strong></a><strong><em>&nbsp;for insightful fintech tales curated for curious minds like you.</em></strong></p>

Neo Banking 101: All you need to know

<img src="https://m2p-website-file.s3.ap-south-1.amazonaws.com/m2p-website-file/marketing-cms/m2p-blog/2022/04/banner1251-8.webp" alt="M2P Fintech" title="" id="rvrudoanq" width="100%" height="317"><p class="text-node" id="3243" style="text-align: left"><strong><em>India has the highest Fintech adoption rate of 87%, significantly higher than the global average rate of 64%.</em></strong></p><p class="text-node" id="6adc" style="text-align: left">India is rapidly evolving and is one of the fastest-growing Fintech markets globally and has also emerged as Asia’s biggest destination for Fintech deals, leaving behind China. Advanced technologies and a customer-centric approach are what bring this thriving industry its profound growth in this decade.</p><p class="text-node" id="49b9" style="text-align: left">Having witnessed this flourishing industry and its achievements, let’s look back on its evolution rather a revolution. So, gear up as this article throws light on how the fintech industry has steadily evolved over the years.</p><h2 class="heading-node" id="5995" style="text-align: left">The fintech landscape in India</h2><p class="text-node" id="59c9" style="text-align: left">Ever since the start of modern society, finance and technology were entwined robustly. The beginning of the Fintech industry globally is traced back to the 19th century when technology started to mark its place in history, which made the fintech industry flourish.</p><p class="text-node" id="8d5c" style="text-align: left">According to a research paper by Arneris, Barberis &amp; Ross, the significant stages of fintech are differentiated into the following eras, which will help us understand the steady fintech evolution better.</p><h2 class="heading-node" id="ab20" style="text-align: left">Fintech 1.0</h2><p class="text-node" id="9d97" style="text-align: left">Outmoded technologies like the telegraph and Morse code were first used to transmit financial information across borders to strengthen the infrastructure rapidly. Then, later during the 1950s, the credit card was first introduced and was the first financial product in the industry, and to everyone’s surprise, it is still in the game.</p><p class="text-node" id="8a77" style="text-align: left">In India, many British Raj banks were nationalized post-independence, when the country’s economic growth started to shoot up, and banking services were availed by many citizens.</p><h2 class="heading-node" id="aff2" style="text-align: left">Fintech 2.0</h2><p class="text-node" id="2853" style="text-align: left">This era has marked the switch from analog to the digitalization of finances led by traditional financial institutions. People perceived finance management and financial institutions differently after the outbreak of the internet. The 1980s and 1990s were the high point in history when online banking pushed the fintech industry to the limelight with electronic installment framework, web-based business models, web-based shopping, portable banking, and digitization of banks.</p><p class="text-node" id="55ad" style="text-align: left">The banks started to experiment with online banking in the 1980s, got the hang of it by the 1990s, and made it even more popular. In India, ICICI Bank was the first to step into this internet banking space with limited banking services like access to account details and transfers within the bank. Other banks also started to follow the path and rapidly altered the way of banking. It is no wonder banks had faced challenges like technical mishaps, fraud, complex cross-border transactions, payment methods, etc.</p><p class="text-node" id="90e7" style="text-align: left">Fintech 2.0 gave the fintech industry’s modernistic look, and the below listed important events triggered the rise of fintech in India.</p><ul class="list-node" id="ef0j04wu4"><li><p class="text-node" id="va2i10cd3" style="text-align: left">The first Indian ATM to withdraw cash was launched in 1987, Mumbai by HSBC.</p></li><li><p class="text-node" id="qdvjgoo81" style="text-align: left">In 1980, the Central Bank of India launched the first credit card in India.</p></li><li><p class="text-node" id="7nkw377ze" style="text-align: left">Stanford Federal Credit Union was the first institution to let its customers access banking functions via the new World Wide Web in October 1994.</p></li><li><p class="text-node" id="5nfi38j5i" style="text-align: left">PayPal launched in 1998, which took the payment systems further after the internet boom.</p></li><li><p class="text-node" id="zu1f9gpkd" style="text-align: left">The Global Financial Crisis in 2008.</p></li></ul><h2 class="heading-node" id="2020" style="text-align: left">Fintech 3.0 — The rise of Indian Fintechverse</h2><p class="text-node" id="e494" style="text-align: left">By the time the 21st century rolled around, India had emerged as one of the active players in this era with a plethora of smart advancements and entrants. Moreover, the Global Financial Crisis in 2008 paved the way for the fintech industry to gain traction and become ubiquitous. People started to shift from the traditional banking system slowly and developed trust over the new entrants.</p><p class="text-node" id="0761" style="text-align: left">The release of Bitcoin v0.1 in 2009, Google Wallet in 2011, Apple pay in 2014 was the start that shaped the face of the fintech industry in India. Since India focused on customer-centric financial products and services, it has seen more rise in few years. The 2016 demonetization drive pulled in a lot of significance for the fintech. The Indian government’s move towards Digital India and to turn India into a cashless economy with financial inclusion also hands out immense support to fintech companies.</p><p class="text-node" id="833e" style="text-align: left">Ever since the traditional banks were struggling to roll out their banking services integrated with the SWIFT system, fintech start-ups started to share the industry space through collaboration. SWIFT system’s initiative like SWIFT GPI provides end-to-end tracking with high security for the transactions. The Indian financial sector opened the door wide open for fintech to offer innovative and cost-efficient financial solutions.</p><p class="text-node" id="da94" style="text-align: left">The rapid adoption of fintech had many Indian firms establish like Paytm, Phonepe, Mobikwik, Freecharge in few years. This made sure smartphone adoption is here to stay and will become the primary method for people to handle their money wisely.</p><p class="text-node" id="a255" style="text-align: left">The span of around five years led to more than 2000 fintech companies in India at present and became the era of fintech start-ups. This made even the traditional banks rethink their strategies and welcome more fintech inclusion in their services to get hold of present-day tech-savvy customers. Open Banking, Banking as a Service (BaaS) were adopted by traditional banks that allow third-party service providers to access their financial data. BaaS further fuelled the entry of neo banks and digital banks in India.</p><p class="text-node" id="e2a6" style="text-align: left">Fintech applications like mobile payments, automated investment apps (Robo-advisors), online lending businesses, and crowdfunding platforms have taken the financial industry by storm.</p><p class="text-node" id="9ccf" style="text-align: left">The following technologies contribute oodles of success to the fintech ecosystem:</p><ul class="list-node" id="852pkzxgr"><li><p class="text-node" id="yrt6n80jz" style="text-align: left">Artificial Intelligence (AI)</p></li><li><p class="text-node" id="67i9a7qba" style="text-align: left">Machine Learning (ML)</p></li><li><p class="text-node" id="vhkc6181f" style="text-align: left">Big Data and Data Analytics</p></li><li><p class="text-node" id="rap6ofrap" style="text-align: left">Robotic Process Automation (RPA)</p></li></ul><h2 class="heading-node" id="4ca4" style="text-align: left">Factors that led to India’s immense Fintech growth</h2><p class="text-node" id="225b" style="text-align: left">The quick adoption of new solutions and financial services made India, a country with the highest fintech usage. The factors which drive India’s fintech growth to the next level are listed below.</p><h3 class="heading-node" id="0376" style="text-align: left">Painless payments</h3><p class="text-node" id="34e0" style="text-align: left">Easy digital payment is the key player in the fintech ecosystem, gaining trust and pulling many users in. Since its beginning, the merchants and shoppers have enjoyed this and made it even popular during the coronavirus outbreak. People were concerned about making a physical payment for safety reasons and quickly adapted to these digital payment modes in a jiffy. The demonetization drive in 2016 made every Indian switch to digital payments and online transactions, which was a green flag for fintech entrants at that time. People now make their digital cash flow without any second thoughts as they feel secure and safe more than handling physical cash.</p><h3 class="heading-node" id="b2cf" style="text-align: left">Payment wallets &amp; UPI apps</h3><p class="text-node" id="68ae" style="text-align: left">This is one of the services which transformed the way people carry cash. Multiple digital payment apps like Google Pay, Apple Pay, Amazon Pay, PhonePe, etc., are definitely a booster for ‘Cashless India’. Features like easy transaction, secure, fast, multiple options benefit these payment wallets to make waves in the Indian fintech industry. Moreover, Artificial Intelligence (AI) and Big Data help users personalize their payments and store multiple bank accounts in a single digital wallet.</p><h3 class="heading-node" id="2917" style="text-align: left">Digital lending &amp; insurance</h3><p class="text-node" id="bc37" style="text-align: left">Fintech is the cherry on the cake when it comes to market-based lending. When already banks were doing their great job in lending and insurance, fintech collaborated to make it even more feasible by giving enormous options, online availability, customer-centric loans, and speedy approval for businesses and customers.</p><h3 class="heading-node" id="b7e3" style="text-align: left">Wise finance management</h3><p class="text-node" id="2d13" style="text-align: left">After the fintech boom, people witnessed many changes in the way they handle their finances. As every Indian has started managing finances digitally, it is easy to keep track of their expenses and make a calculative move. Robo-guides or Robo- advisors also help in wise finance management by providing automated, algorithm-driven financial planning services.</p><h3 class="heading-node" id="d8c7" style="text-align: left">Remittances</h3><p class="text-node" id="8859" style="text-align: left">Fintech's eases the way banks were making international transfers for decades. The remittance was considered an arduous task in the past, involving high fees, tons of paperwork, no tracking of money, multiple players, and a great deal of time. But now, fintech defines it as a flexible real-time payment with transparent fees, end-to-end payment tracking, multi-currency payments, and so on.</p><p class="text-node" id="c088" style="text-align: left">Definitely a worthy throwback on this Independence Day 2021?</p><p class="text-node" id="909a" style="text-align: left">This nostalgic look back at India’s Fintech evolution promises what the busy future holds for the country. The finance industry will flourish, but it demands a little more wait to reveal further episodes. So, let us wait to witness India evolve more and better in the future.</p><p class="text-node" id="af1h7uma5" style="text-align: left"><a class="link" href="https://m2pfintech.com/newsletter/"><strong><em>Subscribe</em></strong></a><strong><em>&nbsp;to our newsletter and get the latest fintech news, views, and insights, directly to your inbox.</em></strong></p><p class="text-node" id="wou8dt45c" style="text-align: left"><strong><em>Follow us on&nbsp;</em></strong><a class="link" href="https://www.linkedin.com/company/m2pfintech/mycompany/"><strong><em>LinkedIn</em></strong></a><strong><em>&nbsp;and&nbsp;</em></strong><a class="link" href="https://twitter.com/m2pfintech"><strong><em>Twitter</em></strong></a><strong><em>&nbsp;for insightful fintech tales curated for curious minds like you.</em></strong></p>

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