What is a fintech, and how is it transforming your life (even if you haven’t noticed)?

In recent years, the word “fintech” has become increasingly common in the news, on social media, and in everyday conversations. But… what exactly is a fintech? And why does it matter so much to people, businesses, and the Costa Rican economy?

You’re probably already using a fintech without realizing it: sending money, paying online, or checking your balance through an app. These tools not only make your life easier—they also help more people access financial services, especially those who were previously excluded.

In this article, we’ll explain what a fintech is, how it works, and how it can help you live a simpler, safer, and more accessible financial life.

What is a fintech?

Simply put, a fintech is a company that uses technology to deliver financial services more efficiently. These companies let you:

• Open bank accounts and manage your money digitally, without lines or unnecessary friction
• Send and receive money
• Pay for services without cash
• Apply for loans in minutes
• Save or invest
• Use virtual cards (prepaid, debit, or credit) to pay with your phone via services like Google Pay and Apple Pay

How does a fintech work?

Unlike traditional banks, a fintech doesn’t need physical branches or classic banking infrastructure. Everything is powered by technology, such as:

• Mobile apps and web platforms
• Artificial intelligence for credit risk analysis
• Systems that connect with banks and the Central Bank via SINPE
• Algorithms that tailor offers to your spending habits
• Cloud services that ensure 24/7 availability

This makes them faster, more accessible, and focused on the user. Most fintechs operate under regulations like Costa Rica’s Law 7786 and must comply with security, data protection, and anti-fraud standards.

How do fintechs operate?

Fintechs operate in two main ways: they create new ways to move or use money, and they also partner with banks to make everything simpler, faster, and more accessible.

Innovation hubs

Many fintechs develop solutions that didn’t exist in the country before, such as:

• Digital wallets for account opening, money management, savings, and access to virtual cards
• Buy Now, Pay Later (BNPL) systems to shop and pay in installments without bank procedures
• Payment gateways for physical and online stores

Financial system partners

Other fintechs complement the traditional financial system by:

• Building digital platforms for banks
• Providing services like identity verification (KYC), digital signatures, or credit scoring engines

That mix of innovation and collaboration is what makes fintechs so transformative in how we use, move, and understand money.

Pagü: an example of fintech improving daily life

So, what does this look like in real life? Meet Pagü, a fintech built to help you manage your money clearly and confidently.

With Pagü, you can:

• Open IBAN accounts in your name in colones or dollars, fully backed by the Central Bank of Costa Rica
• Top up your Pagü accounts using SINPE Móvil, SINPE transfers (PIN payments), Real-Time Debits (non-refundable DTR), or prepaid/debit/credit cards directly from the app
• Send and receive money via SINPE transfers, SINPE Móvil, or between Pagü accounts
• Use an international virtual debit card to pay from your phone, whether in physical stores or online shops anywhere in the world
• Pay public and private services directly from the app, simply and securely

Pagü shows how a well-designed fintech can make a real impact by helping more people access modern financial services and improve their quality of life.

Who benefits from fintech?

Fintechs serve:

• People who want to manage their money without complications
• Entrepreneurs and SMEs who need to receive payments, make payments, or access financing easily
• Young people looking for digital alternatives to traditional banks
• Unbanked individuals who still have access to a smartphone

In short, fintechs democratize access to financial services—especially for those historically left out.

How do fintechs make life easier?

Here are some real ways fintechs are already changing lives in Costa Rica:

• Instant transfers via SINPE Móvil, without going to the bank
• Real-time expense tracking on your phone
• Bill payments via apps—no lines, no forms
• Digital loans without paperwork or co-signers
• Virtual card payments using Google Pay or Apple Pay
• Goal-based investing tailored to your income

All this, without lines, schedules, or paperwork.

How do fintechs boost the economy?

Fintechs directly impact the national economy by:

• Formalization: Helping small businesses charge legally and access credit
• Productivity: Automating financial processes that used to take hours
• Healthy competition: Pushing banks to improve their services
• National innovation: Fueling local tech talent and entrepreneurship
• Financial inclusion: Enabling more people to enter the system

In a country where over 90% of the population has mobile internet access, fintechs are key to a more modern and fair economy.

The social impact of fintechs

Beyond economics, fintechs bring major social benefits:

• Empowering entrepreneurs through access to funding
• Helping rural families receive payments or remittances
• Reducing the use of cash—and with it, the risk of theft or fraud
• Promoting digital financial education, especially among young people
• Encouraging sustainability by digitizing financial processes

Fintechs don’t just modernize payments—they open real opportunities for people to access financial services and improve their lives.

Conclusion: fintech isn’t the future, it’s already here

You may not have noticed, but you’re probably using fintech every day:
When you pay with SINPE Móvil, transfer from an app, or check your balance on your phone.

Fintech is here to stay—to simplify and connect.
And in Costa Rica, more of us are using it every day to live simpler, safer, more connected lives.