Smart contracts automate complex financial agreements, execute transactions automatically upon meeting agreed conditions, and store the terms digitally on the blockchain. In fintech, this reduces the need for intermediaries, which lowers transaction costs and minimizes delays. Smart contracts also provide a higher level of security and reduce the likelihood of disputes, as the contract execution is transparent and immutable. For example, in trade finance, smart contracts can automatically release payments when goods are received, significantly speeding up transactions and reducing paperwork.