Every industry has words that mean something within the industry that is different from the generally used meaning of the word. In Sociolinguistics, this is called Register.
Two lawyers could be discussing, using legal terms, and you will not have the faintest idea of what they mean. It is not because they are speaking a different language but because many of the words and phrases they are using have specific meanings within the legal world.
Fintech has its words and phrases too, and while you might not be lost when used, it helps to get familiar with and understand them. Here are four basic and most used terms:
1. Payouts: this term is used for money leaving the system or wallet. The non-fintech word for this is Transfer. It could be a bank transfer or a P2P transfer. But to us in the Fintech space, it is payouts. Another industry term used instead of payouts is disbursements.
2. Collections: this term is used for money coming into the system. In business terms, it is receiving money in your account/wallet. It could be from outside the system or another user on the same platform.
3. VBA: this stands for Virtual Bank Account. It is an account used to fund a wallet. It is not an actual account that retains money; it is merely a channel to fund a wallet on a fintech platform, hence the name virtual bank account.
4. P2P: this stands for peer-to-peer. It refers to a transfer that happens within a platform. The sender and the receiver are both on the platform; the transfer is between two accounts on the same platform. P2P transfer is the best because it has a 99.9% success rate.
These terms are just the ABCs when it comes to fintech-specific terms. If you are not tech-savvy, you will definitely get lost when developers start talking about API integration. But with these, you are good to go for everyday fintech conversations.
