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Definition of Fintech The word fintech derives from the coupling of two complementary areas: financial services and solutions based on advanced technology.Kickstarter, a very large funding platform for creative projects, has strongly lowered the level of accessibility of funds for startups or simple projects.15 Wealthfront embodies a fusion between finance and automation, allowing the management of assets through complex algorithms.16 CommonBond is a marketplace lender that refinances graduate and undergraduate student loans.The word "fintech" has made its way into the Oxford Dictionary as: "Computer programs and other technology used to support or enable banking and financial services."12 Wikipedia defines "FinTech" as: "Financial technology, also known as Fintech, is a line of business based on using software to provide financial services. fintech companies are generally startups founded with the purpose of disrupting incumbent financial systems and corporations that rely less on software."13 It is possible to set out a broad working definition of the term that perfectly fits with the aim of this book.A simpler definition of fintech is as an industry made up of organizations using novel financial technology to support or enable financial services.14 There are twomain aspects to consider--the subject and the scope of the definition:It is important not to consider fintech initiatives as an ecosystem populated only by startups.The term is often associated with startups, mainly because the use of advanced digital solutions in financial services is a relatively modern trend.These examples depict a clear situation.

Definition of Fintech
The word fintech derives from the coupling of two complementary areas:
financial services and solutions based on advanced technology. The economic
literature does not agree on a single definition of fintech due to the
overall diversity of the business. The word “fintech” has made its way into
the Oxford Dictionary as: “Computer programs and other technology
used to support or enable banking and financial services.”12 Wikipedia
defines “FinTech” as: “Financial technology, also known as Fintech, is
a line of business based on using software to provide financial services.
fintech companies are generally startups founded with the purpose of
disrupting incumbent financial systems and corporations that rely less on
software.”13
It is possible to set out a broad working definition of the term that
perfectly fits with the aim of this book. In particular, it is possible to
define fintech as initiatives, with an innovative and disruptive business
model, which leverage on ICT in the area of financial services. A simpler
definition
of fintech is as an industry made up of organizations using
novel financial technology to support or enable financial services.14
There are twomain aspects to consider—the subject and the scope of
the definition:It is important not to consider fintech initiatives as an ecosystem populated
only by startups. The term is often associated with startups,
mainly because the use of advanced digital solutions in financial services
is a relatively modern trend. Even mature and maturing companies
have started to transform their businesses with advanced financial
technology solutions, for instance, by making use of online or mobile
services.
• The scope of the fintech definition requires more details. This book
presents a typical fintech business model. The model helps to understand
the reasons why some initiatives are more successful than others.
It is important to understand that financial technology solutions are a
very complex and regulated subject, where several and different stakeholders
place their interests.
Fintech initiatives cover a wide range of financial areas. Lending Club,
one of the world’s largest peer-to-peer lending platform (Schumpeter
2013), directly connects borrowers and investors by making credit more
affordable and investing more rewarding, and promoting a completely
new loan program.
Kickstarter, a very large funding platform for creative projects, has
strongly lowered the level of accessibility of funds for startups or simple
projects.15 Wealthfront embodies a fusion between finance and automation,
allowing the management of assets through complex algorithms.16
CommonBond is a marketplace lender that refinances graduate and
undergraduate student loans. It has lowered the cost of student loans and
allowed saving an average of 14,000 dollars over the lifetime of the loan
(Mulhere 2015). These examples depict a clear situation. Fintech companies
are threatening traditional financial services. The former can provide
more innovative and customer-centric business models. These disruptive
organizations are gradually gaining market share and profits against traditional
financial services, which are in serious need of reviewing their
business models and changing strategy in order to be more competitive
in the market.