4 key legal differences
Fintech vs.
Today, Fintech is an integral part of most people's lives:
46% use at least 3 fintech services.
This is especially true for modern business owners who value their time
and want to manage the company's capital without any problems.

*Reading time: ~ 3 min
According to McKinsey, the use of mobile banking channels has increased by 20-50% in different countries since the beginning of the pandemic and continues to grow. Thanks to the use of new technologies, complex financial services have become convenient and affordable.

As a result, many believe that traditional banking will soon disappear altogether.

Is it so? Let's go over the points.
1. Customer Experience
FinTech: 1
Traditional banks: 0
You can make any transaction or use a financial service right during the transaction. To do this, you only need to sign up using a mobile application or website.

You can also open an account from anywhere in the world, consult online and contact the chatbot for help even in the middle of the night.
To open an account or apply for financial services, you need to save time and show up at the bank in person.

This is a necessary option to verify your identity and provide financial services, though it is extremely inconvenient.
2. Services cost
FinTech: 2
Traditional banks: 0
Most of the services are provided automatically and do not require any additional payments from you. Thanks to an optimized system, Fintech companies offer products and services at prices up to ten times cheaper compared to traditional banks.
A huge amount of real estate and staff is expensive. Therefore, you will have to pay even for assistance in opening an account or for issuing a bank statement on its status.
3. Regulation
FinTech: 3
Traditional banks: 1
They do not have a specific regulator, it all depends on the rules of a particular country.

Recently, more fintech companies volunteer to be governed under international supervision to make their customers feel safe. You should pay attention to such businesses.
Classic institutions are regulated by national or central banks in their country of origin.

Regulators monitor banks' compliance with legal requirements, restrictions, and rules established to protect money and transparency in customer relations.
4. Risks
FinTech: 3
Traditional banks: 3
Flexible rules make the industry riskier. It can make it difficult to understand your rights and security options as a customer.

It is also important to mention a serious threat of cyberattacks and inconsistent use of personal data.
Traditional banks are the least risky financial institutions. Your rights are clearly formalized and protected by government authorities.

In addition, banks have a more stable financial system.
So what is better: Fintech or traditional banking?

Choosing the perfect money management intermediary is an extremely difficult task. You need to clearly define what is critically important for your business: the reliability of a traditional bank or the speed and convenience of fintech companies.

The AppLaw team will help you prioritize correctly, find the right solution and make the right choice.

Grow and scale your business and leave the rest to us!

Email us: info@applaw.group
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