8 FinTech Terms That You Must Know!

Dec 22, 2020
 |  1 min read

Do you know how blockchains work? How about Robo-advisors? Or Unified Payments Interface?

Trying to understand FinTech terms can be an arduous task.

Forget the fact that many of them are difficult to pronounce. As they stare at you from your phone or laptop screen, some of these terms can be straight up intimidating.

Unfortunately, there is no way out of it. The FinTech industry is here to stay and how!

According to thebusinessresearchcompany.com, the global FinTech market is expected to be valued at USD 158 million by 2023. That number is expected to reach USD 191 million by 2025 and USD 325 million by 2030.


A cryptocurrency is a virtual or digital currency. It is created to ideally serve the same purposes that physical currencies do.

They function as limited entries in a database. Unless certain specific conditions are met, these entries cannot be altered.

Cryptocurrencies get their name from the exceedingly powerful cryptography used to safeguard its processes. Thanks to them, digital currencies no longer require blind trusts and third parties to function.


In 2009, an anonymous entity identifying itself as Satoshi Nakamoto introduced the world to Bitcoin. Described as a “peer-to-peer cash system”, Bitcoin is completely decentralized with no controlling authority or servers.

With the third-party approach, authorities were in control of your personal details and your funds. With Bitcoin, this is executed via Blockchain – a public ledger that records all transactions and makes it available to everyone within the network.


Blockchain makes any digital asset transparent and unalterable with the use of cryptography and decentralization.

A simple way to understand Blockchain technology is to think of it as a Google Doc. Google Docs are distributed instead of being transferred or copied.

This allows everyone involved to access the document simultaneously. Any changes made are in real-time and wholly transparent to all the stakeholders.

Blockchain is a revolutionary and promising technology. It brings transparency, eliminates fraud, and reduces risks.

Anti-Money Laundering (AML)

Anti-Money Laundering (AML) comprises of all those procedures, regulations, and laws that stop criminals from disguising funds obtained through dubious means as legitimate income.

Even though AML laws cover criminal behavior and transactions in a limited capacity, their applications have far-reaching consequences.

For instance, AML laws require financial institutions and banks that allow customer deposits or issue a credit to actively stop money-laundering.

AML regulations monitor illegal activities such as tax evasion, public funds corruption, illegal goods trade, and market manipulation. They also target the means of procuring such ill-gotten money.

Know Your Customer (KYC)

KYC is the abbreviation for know your customer or know your client. It is the mandatory process of verifying the identity of any bank customer.

It is a way for banks to validate the identity of their clients on a regular basis.

KYC helps to identify and prevent corrupt activities such as terrorism financing, money laundering, etc. It involves biometric verification, address proof, face verification, ID card verification, etc.

The responsibility to comply with KYC guidelines squarely rests with the banks. Failure to comply incurs heavy penalties.


Robo-advisors are online platforms that provide financial planning services that are algorithm-driven and automated. With the help of an online survey, they collect information about the future goals and financial situation of their clients.

They then utilize this data to invest their client assets and also offer advice. Some of the features of Robo-advisors include competitive rates, customer education, attentive customer service, security features, portfolio management, account services, goal planning, and easy account setup.

Betterment was the first Robo-advisor that was launched in 2008. It started operating with investor money in 2010, at a time when the great recession was in full swing.

Unified Payments Interface (UPI)

The National Payments Corporation Of India has developed the instant real-time payment system called the Unified Payments Interface (UPI). It facilitates inter-bank transactions and is regulated by the Reserve Bank of India (RBI).

It operates by transferring funds from one bank account to another across a mobile platform. In November 2020, UPI hit 2.2 billion monthly transactions.

UPI is an interbank payment system that allows the requesting or sending of money in real-time. A single app can link multiple bank accounts.

Money can be requested or sent using any of the following ways:

  • QR Code: Money can be sent via QR code which has an enclosed mobile number, account number, and IFSC or VPA.
  • Aadhaar: Money can be sent to any bank account that is mapped to an Aadhaar number.
  • Account number and IFSC: Send money directly to someone's bank account.
  • Mobile number: request or send money to any bank account that has a registered mobile number.
  • UPI ID or Virtual Payment Address (VPA): Request or send money to-and-fro a bank account that has a mapped VPA.


EMV is a form of payment that adheres to a standard complied by all smart payment cards. It is widely accepted by automated teller machines and payment terminals.

Visa, Mastercard and Europay are the 3 companies that pioneered this standard together. As such, its nomenclature is the first letter of each company.

EMV cards are also called IC cards, integrated circuit cards, chip cards or smart cards. They save their data on magnetic stripes or integrated circuit chips.

Instant personal loan app services are one of the most promising verticals within the FinTech domain. With just a handful of documents and no collaterals, users can register and avail instant personal loan online of small to medium ticket size for a short duration.

By regularly transacting on the personal loan apps and maintaining a healthy credit score, consumers of instant personal loan app services can increase their loan amount.

mPokket is one of the best personal loan apps in India. We provide loans up to Rs.45,000 to young professionals and college-goers.

The mPokket app is available for download from the Android Play Store. To know more about our offering, get in touch with us today!

Gaurav Jalan

Gaurav Jalan is the Founder and CEO of mPokket, a digital lending platform serving underserved Indian youth. He leverages technology and experience to deliver cost-effective credit to marginalized populations. In his role, he provides strategic direction and oversees execution to fulfill mPokket's mission.