{"id":20793,"date":"2022-05-19T11:44:00","date_gmt":"2022-05-19T09:44:00","guid":{"rendered":"https:\/\/www.getsmarter.com\/blog\/?p=20793"},"modified":"2025-09-26T07:59:34","modified_gmt":"2025-09-26T05:59:34","slug":"the-history-of-fintech","status":"publish","type":"post","link":"https:\/\/www.getsmarter.com\/blog\/the-history-of-fintech\/","title":{"rendered":"The History of Fintech"},"content":{"rendered":"\n

The history of fintech innovation goes as far back as the 1860s. By learning about fintech\u2019s origin and evolution, it\u2019s easier to understand where these exciting and disruptive technologies are currently headed.<\/p>\n\n\n\n

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  1. The fintech revolution begins<\/li>\n\n\n\n
  2. Financial innovations<\/li>\n\n\n\n
  3. The emergence of modern fintech trends<\/li>\n\n\n\n
  4. Significant fintech advancements<\/li>\n\n\n\n
  5. A new era of fintech trends<\/li>\n\n\n\n
  6. Fintech introduces the world to online banking and trading<\/li>\n\n\n\n
  7. Fintech innovations in the new millennium<\/li>\n\n\n\n
  8. Prepare yourself for the financial possibilities of fintech<\/li>\n<\/ol>\n\n\n\n
    \"\"<\/figure>\n\n\n\n

    The fintech revolution begins<\/h2>\n\n\n\n

    The origins of fintech can be traced back to the 1800s:<\/p>\n\n\n\n

    1860s<\/h3>\n\n\n\n

    Giovanni Caselli developed the pantelegraph in the 1860s <\/span>\u2013<\/span> a period now considered the beginning of the history of financial innovation.1<\/sup><\/span><\/p>\n\n\n\n

    The pantelegraph was mostly used to verify signatures in banking transactions by sending and receiving transmissions on telegraph cables. This verification process was slow and cumbersome <\/span>\u2013<\/span> it took about 108 seconds for a sheet of paper with around 25 written words to transmit.2<\/sup><\/span><\/p>\n\n\n\n

    1880<\/h3>\n\n\n\n

    By the 1880s in the U.S., consumers and merchants began exchanging goods and services for credit using charge coins and plates.3<\/sup><\/span><\/p>\n\n\n\n

    Charge coins were metallic tokens that displayed the customer\u2019s identification number and an image associated with the vendor, and were roughly the same size and shape as modern coins. Charge plates were either aluminum or white metal plates embossed with a customer\u2019s name and address on the front and a paperboard insert on the back with the issuer\u2019s name and cardholder\u2019s signature. <\/span><\/p>\n\n\n\n

    Charge coins were mostly forgotten by 1960, followed by charge plates, which were replaced with modern credit cards. <\/span><\/p>\n\n\n\n

    \"\"<\/figure>\n\n\n\n

    Financial innovations <\/h2>\n\n\n\n

    The 1900s saw more rapid financial innovations than the previous century:<\/span><\/p>\n\n\n\n

    1918-1970<\/h3>\n\n\n\n

    The next early fintech innovation was when the United States Federal Reserve Banks devised a system to move funds electronically. This system was first known as the Federal Reserve Wire Network and is now known as Fedwire.4<\/sup><\/span><\/p>\n\n\n\n

    Connecting all 12 Reserve Banks across the country, the Morse code-based system was used as a real-time gross settlement funds transfer system until the 1970s. During this decade, the process shifted from telegraphy toward telex, and finally to computer operations and proprietary communication networks. Telex was an international network of teleprinters that transferred messages securely from one teleprinter to another.5<\/sup><\/span><\/p>\n\n\n\n

    1919<\/h3>\n\n\n\n

    In what\u2019s arguably the first allusion to fintech and the future of financial services, economist John Maynard Keynes wrote about the link between finance and technology in his book, <\/span>The Economic Consequences of the Peace.6<\/sup><\/span><\/i><\/p>\n\n\n\n