Nowadays technology is inevitable in the world of finance. Various fin-tech terms have evolved. Continue reading to know the most useful fin-tech terms:
AML: AML means anti-money laundering. All over the world, nations have a set of regulations to curb activities which pump money earned from illegal sources into a particular mode to convert it to genuinely-earned money. Since the amounts earned from illegal activities like terrorism are converted to white money, anti-money laundering checks are stringent all over. Basically, know-your-customer norms came into existence to curb AML.
API- It is the set of instructions which collects data from applications and sends to the database server. It gets the feedback from the database server and gives it back to the applications. Only with the help of APIs, we are able to work across so many apps. In the future APIs have a vital role to play in the open banking system.
Big data: These are extremely large sets of data which are analyzed and computed. The analysis reveals patterns through which human behavior is predicted.
Bitcoin: A bitcoin is a species of digital currency. It is digitally minted. Encryption techniques are used to transfer the currency. It does not depend on any central bank. Apps like bitcoin trader are used to trade in bitcoins.
PCI compliance- When your company accepts card payments, it becomes necessary to store and process the card data. This has to be stored in a secure way. It is mandatory to store the data with a PCI compliance hosting provider in order to ensure data security.
Saas- It is a software distribution model. Here the applications are provided to customers over the internet by third-party service providers. It works based on cloud computing. It helps customers to cut on costs of purchasing and installing software. They can make payment depending on the level of their usage.
Tokenization- Tokenization helps in data security. Here the sensitive data is replaced with unique identification symbols. These symbols retain all the essential information.
P2P lending: It is nothing but peer to peer lending. When borrower requires a loan, he borrows from individual lenders using the P2P online platforms. Thus, financial institutions and middlemen do not have a role to play here.
Crowdfunding: It is nothing but small amounts of capitals which are collected from numerous individuals who are investors. It offers good motivation to entrepreneurs. Startups which need funding need not undergo complicated loan processes of banks. Instead, they can easily get the required capital with the help of crowdfunding.