What is a fintech company and how does it differ from traditional banks?

A fintech company uses technology to provide financial services, often more efficiently than traditional banks. Unlike banks that operate physical branches, fintech firms offer services like payments, lending, and investing through apps and websites. For example, cryptocurrency exchanges are fintech companies that let you buy Bitcoin or Ethereum instantly without visiting a bank. Traditional banks have higher overhead costs and slower processes, while fintech companies typically offer lower fees, faster transactions, and 24/7 availability. However, traditional banks are heavily regulated and insured, whereas fintech regulation varies by country. Many fintech companies now partner with banks or become regulated themselves to gain trust and legitimacy in the financial system.