Compare the Best Fintech Credit Cards

What Is Fintech?

Fintech refers to digital technologies and financial services. The term “Fintech” is short for financial technology and relates to a variety of new financial products designed to overturn and disrupt traditional banks and banking services.

The roots of fintech lie in the 1950s and the introduction of the first credit cards. The industry saw further evolution in the 1960s, introducing ATMs and electronic stock trading systems in the 1970s. However, we commonly call fintech more closely associated with the digital boom and rise of the world wide web in the 1990s and 2000s.

Fintech’s role in banking growth is also not a new phenomenon. According to the US Chamber of Commerce, fintech is directly responsible for an explosion in banks throughout the last three-quarters of a century.

There were only approximately 13,500 banks in the United States in 1950. Thanks to the technological advances in the financial sector, that number rose to more than 83.000 in 2008. Today, neobanks and challenger banks are further pushing the limits of fintech – leading to a new banking revolution.

The future of fintech appears to be cryptocurrency, with a new range of credit cards earning rewards and cash back via Bitcoin, Ethereum, Dogecoin or other cryptocurrencies.

Where fintech in the 1950s introduced credit cards, the most recent trend in financial technology is disrupting the credit card status quo.

Related Article: How Fintech Is Disrupting the Traditional Credit Cards Market

Examples of Fintech

Fintech is a broad term, making it difficult for many Americans to understand what exactly fintech is. Fortunately, there are plenty of common examples of fintech, which are essential components of our everyday lives.

Some examples of fintech services and technologies include:

Crowdfunding

Crowdfunding services, like GoFundMe, Kickstarter, and others are redefining how companies raise funds. These unique fundraising platforms also open up the funding market to charities, groups, and even individuals, thanks to lower costs, ease of advertisement, and streamlining of the entire process.

Mobile Wallets

Everyone is familiar with mobile wallets. Apple Pay, Samsung Pay, Google Pay features in most mobile phones, making online payments and contactless payments more safe and secure.

Services like Venmo, PayPal, and Square are also examples of fintech mobile wallets, allowing merchants to make purchases more straightforward for customers without cash – and allowing friends to split bills, lend to family or friends.

Credit Monitoring Apps

Like Experian and Credit Karma, credit monitoring apps let consumers monitor their FICO or VantageScore credit scores, track their financial progress, and match their credit profile with potential credit card offers.

Stock Trading Apps

While fintech was crucial in opening up the stock market to Americans in the 1950s and 1960s, mobile stock apps like Robinhood redefine how Americans trade in the 21^st century. Mobile stock trading apps, including Acorns, allow investors to trade stocks from anywhere with their instead of visiting  their stockbroker.

Source: Tipalti

Fintech Credit Cards

Fintech credit cards come in two distinct varieties. The first type of fintech credit card is issued with a traditional banking partner or payment network. These cards prioritize unique rewards structures or features while maintaining a credit card’s classic look and feel.

The second type of fintech credit card is issued through what is known as a neobank. These credit cards bypass established banking partners and seek a new approach towards the credit card experience’s financial aspect.

What Is a Neobank?

Neobanks (also known as a challenger bank) is a new form of banking that prioritizes online financial services over traditional banking models. The internet-only approach of a neobank isn’t solely about “disrupting the norm” but instead helps save costs – savings passed on to the customer.

Some of the benefits of a neobank credit card include:

• Lower interest rates than traditional credit cards
• Reduced fees or no fees
• Access to underbanked communities

How Do Neobanks and Challenger Banks Differ from Traditional Banks?

Neobanks differ from traditional banks, like Citibank, Capital One, or JPMorgan Chase, in several ways:

• Not chartered with state or federal regulators
• Must partner with traditional banks to offer FDIC insurance for deposits
• Focus on digital processes and mobile apps
• Many don’t offer overdrafts on deposit accounts

Because of the reliance on new technologies, neobanks are not for everyone. Those unfamiliar with current technologies or apps may struggle when banking with a neobank. These fintech issuers also lack physical branches, making online banking the only option.

Examples of Fintech Credit Cards

• Apple Card
• Upgrade Visa® Card with Cash Rewards
• Ollo Rewards Card
• Ollo Platinum Card
• Avant Credit Card

What Are the Best Fintech Challenger Bank, and Neobank Credit Cards?

Fintech companies are taking a fresh look at the credit card market and offering applicants something new. These new features include saying goodbye to fees, changing how consumers pay down debt, and offering the types of perks and rewards that many major issuers are ignoring. Browse some of our favorite fintech and neobank credit cards by checking out:

The Five Best Fintech and Neobank Credit Cards of 2021