Fintech loans: Understand what it is and its advantages

With the advancement of the digital age, several services and products have been facilitating the daily life and bringing advantages that, previously, were restricted to smaller groups.

Until recently, for example, loans could only be made at a banking institution, with many limitations and bureaucracies that excluded several people outside the system. Today, however, we can already count on loan fintechs!

Basically, these are companies or startups that provide services that, a few years ago, were made only by the financial market – by brokers and banks. Becoming better known only in 2015, they are already considered an innovation in the capital market.

But, after all, do you know how a loan fintech works? In this post, we will take all your doubts and mention the main advantages of having this type of service. Follow and check it out!

What is a loan fintech and how does it work?

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We can define a fintech as an organization that makes use of technology to offer products in the financial area through innovative methods, offering a differentiated and unique experience for its customers.

It works like a classic startup – that is, mainly in the virtual environment – and has the customer as the focus of its business strategy. The user contacts her, stays on top of loan plans and, most importantly, realizes that her interest rates are much lower than those offered in traditional bank loans. Often, it is not even necessary to offer guarantees to close the deal!

It is through formal banking investment that fintechs develop. In other words, they use common credit and ensure business risk through artificial intelligence mechanisms, which perform the risk calculation of this credit offer.

What are the advantages of borrowing money from this type of company?

What are the advantages of borrowing money from this type of company?

In fact, there are countless advantages to borrowing money with a loan fintech. Let us see below the main ones.

Data technology and information security

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In the face of so many technological advances today, information security systems are constantly being developed and improved, so that our exposure to others is reduced and our valuable data is preserved. In this sense, fintechs are known precisely for providing security of access to the client’s platform – especially because, when talking about financial operations, security is essential, right?

The system used by a loan fintech requires the use of confidential credentials (username and password) to view the data of a person or company. In addition, there are other security measures offered by these companies. Among them, we can highlight:

  • if there is a default by the employee, the company should not be able to afford it, since it is only an “intermediary” between the financial institution and the employee;
  • end-to-end security – this protects your customers from the risks of attacks and leaks;
  • security in approval – the organization only needs to fill in the online registration and the agreement will be made according to the characteristics of the business, that is, without the need to use resources and/or human material to offer the credit option to its employees.

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