Jargon You Should Know To Get Ahead When Applying For Fin-Tech
By Skye A Aitken, on 11 October 2019
Deciding on a career path can be an overwhelming experience but fear not, you are probably not the only student stressing about which career path to choose. Often the industry jargon that crops up during career research and investigations can be downright terrifying. But here is the good news – you are not alone! As a student putting feelers out, you are in the best possible position to get a head start on learning the technical jargon and positioning yourself as an up-and-coming expert in your chosen field, long before any of your “competitors” (sorry, those are unfortunately your classmates) do.
You’re in the right place, especially if you are looking to get a handle on Fin-Tech technical jargon. Before you can start applying for roles, you need to know what the industry pros are talking about (and referring to), without having to ask them – so I am going to share with you what I’ve learned along the way. Let’s jump right in…
It is good to know what Fin-Tech stands for – it almost certainly will come up in an interview. Think of an interviewer asking “So, what is your understanding of the term Fin-Tech?”
It is basically an abbreviation of ‘financial’ and ‘technology’. Any business that works with technology that manages and controls finances is considered a Fin-Tech company. Fin-Tech can refer to several different financial areas, such as cryptocurrency, banking applications, money management tools, automated investment programs and apps, and so on.
“Sandbox” is a bit of lingo that refers to regulation. When someone in Fin-Tech speaks of a sandbox, they are referring to a “safe space” or a controlled environment where Fin-Tech companies can try out new tech. The Fin-Tech community has started eagerly trying to implement “sandboxes” where tech innovators can present their new tech aimed at the financial services industry. This way of testing provides both tech designers and companies operating in the financial sector the opportunity to uncover potential glitches as well as regulation problems that might arise from using the tech. It also helps both parties to figure out if they are a good “match” for each other.
This is tech software that underpinned Bitcoin. In some instances, industry pros might refer to it as DLT which stands for Distributed Ledger Technology. The software provides industry professionals with access to shared info records, which are regularly updated by computers (a network).
This is the term used for advice that is provided via a computer algorithm instead of an actual live human. A robo-advisor will be able to invest a client’s money on their behalf. The investments are done in portfolios that are made up of several small funds that are exchange-traded.
- Future Proofing
This is the process of ensuring that the product or Fin-Tech innovation is more than just a passing fad. This will require testing, market research and projections.
- Marketplace Lending
A marketplace lender is an alternative financial service (not a bank) that uses technology to evaluate loan requests. The data gathered is used to match lenders with borrowers. Marketplace lenders are efficient with cost-cutting and can streamline loan approvals.
An entrepreneur is said to be bootstrapping when he attempts to found and build a company with little capital or from personal finances or the operating revenues of the new company– like playing it by ear with no back-up finance.
- Proof of Burn
This term can also refer to “proof of work” and basically means that someone is bootstrapping (when an entrepreneur starts a business with little capital) one cryptocurrency for another. When someone mentions “proof of burn”, they are implying that crypto miners should prove that they burned some of the currency they acquired. The proof required is showing that currency has been sent to an un-spendable address that is verified.
- Open Banking
This is something that the non-bank financial lending sector is pushing for in the UK. While not many banks embrace the concept, there are some that are creating such platforms. Open Banking is a concept that entails banks sharing their data with third parties, to ensure that there is more competition and choice in the financial lending sector and to improve on transparency. The idea is to benefit consumers. Fin-Tech companies wish to create applications (or one application) that presents multiple bank account information within one app. This will make financial management easier and quicker.
These are just some of the tech terms that are hot in the Fin-Tech industry right now. Brush up on your jargon knowledge before applying for any Fin-Tech roles. One of the requirements of an expert in the field is to have your finger to the pulse of all things tech related – the jargon included. Good luck!
This is a guest blog post written by Alice Farren. Alice is a financial journalist, fin-tech and SME specialist with a passion for promoting the talents and success stories of emerging entrepreneurs.
SME Loans is a business finance brokerage specialising in alternative funding solutions for small and medium-sized enterprises.