Roadmap to Fintech App Development for Future Fintech Leaders

Introduction

Technology has always been a disrupter of conventional practices that we used to follow. Then came an instance in history where ‘the internet’ took over the planet by storm. This opened a large marketplace for every sector. Internet and technology gave everyone a right to choose and express their needs and wants on a global platform.

We have noticed the same trajectory with the Financial Service Sector as technology has put a dent in the financial sector. This blog aims to enhance your understanding of how Fintech Apps have brought a wave of prominent changes, disrupting the financial service sector permanently.

Let the learning begin!

What is Fintech?

Fintech is the design and delivery of financial services infused with innovative technologies. It’s the abbreviation for the term ‘Financial Technology’. Fintech is a collection of myriad technologies, products, and business models that have hugely affected the financial service sector.

It invites every financial segment ranging from crowdfunding to cashless payments, to virtual currencies, to Robo-advisors. Whenever you transfer funds or shop online that’s Fintech.

How has Fintech transformed the Financial Service Sector?

Fintech has been part of the financial sector since the 1950s. We used it while using ATMs and credit cards. It’s evident that banks dominated the Fintech sector in the prior years. But after the 90s, with the rise in the use of the net and internet-based services like eCommerce, tech companies got an opportunity to gradually replace the old phone-based retail merchandise model.

The world has witnessed Fintech being deployed in 2 versions. Let’s understand how they serve us today.

1. Fintech 1.0
   Fintech 1.0 concentrated more on online payment systems, trading, and lending. It also gave flight to wealth management products.
2. Fintech 2.0
   Fintech 2.0 undoubtedly paid attention to improving the efficiency and security of current transactions. But it focused more on redefining and creating new Fintech solutions.

Why do Fintech companies have the upper hand?

• Fintech companies have had exponential growth as they’ve managed to fill the gaps between the customer expectations and the bank’s conventional tech offerings. They have managed to make financial transactions way more fast, convenient, and brought the user experience to a whole ‘nother level.
• Fintech companies also savor the independence to decide on the parts of banking they want to get involved in. Hence, solving even one problem efficiently can generate great returns.
• The fintech revolution has provided financial inclusion to a large part of the Unbanked crowd. Still, the planet has around 2 billion completely unbanked people. The only way for them to save money is by stashing it under the mattress. AI is also pushing banking and fintech to new heights.

Markets captured by Fintech Companies

• Crypto/Blockchain
• Banking
• Payments
• Lending
• Capital markets
• Wealth management
• Insurance

Let’s catch a glimpse of some statistics that portray the past, present, and way forward for Fintechs.

Statistics

• The fintech investments surged 18% in 2018. Startups working with lending and payment technologies received the maximum amount of funding.
• At least 2 fintech services are utilized by 1 out of 3 people in 20 major economies of the planet.
• In 2018, around 70% of senior bank executives agreed that the notion of collaborating with fintech is one of all the simplest futuristic investments and a necessity for banks.
• An approximate 12 billion USD of investment was received by fintech companies in 2018.
• In 2020, one of the largest contributing segments will be Digital Payments with the total transaction value of a whopping 4, 406, 431 million USD.
• 27% of the businesses globally are expected to keep up their current use of fintech services in 2019, while an additional 24% plan on inculcating the same in the following year.
• 61% of Americans used fintech solutions in 2018 and this number is expected to reach 65.3% by 2022.
• The stats for Fintech on-demand App Development look healthy. Let’s study a few of the foremost successful fintech apps that have made the cut.

Top 3 Fintech Apps

Robinhood

Robinhood changed the face of online stock trading by introducing a commission-free app that targets Millennials. They help beginners as well as amateur individuals to invest in the stock market.

Robinhood disrupted conventional commission-based practices and made their competitors do the same, so as to compete with Robinhood. It suggests ‘hot investment’ opportunities and also allows paid and unpaid users to trade without awaiting their funds to settle.

It provides the user with reminders about their upcoming dividends. It’d also offer a free stock after you sign-up for the first time along with the complete information related to the stocks for up to five years in the past. The corporate is currently valued at 11.2 billion USD.

M-Pesa

M-Pesa is a peer-to-peer mobile money transfer service introduced by Safaricom in Kenya in the year 2007. The mobile money transfer model became so successful that in 5 years after its launch it had about 19.5 million users.

M-Pesa allows its users to transfer e-cash as well as convert e-cash into real cash via SMS. The cash operations happen at the closest M-Pesa retail outlet from the user. These are called “Agents” of M-Pesa.

M-Pesa has over the years processed 48.76% of Kenya’s GDP. This accounts for 29 billion Euros or 3.6 trillion shillings. The credit for M-Pesa’s success in Kenya goes to its speed and ease of transferring money. Money transferring to rural regions was a cumbersome task for Kenyans working in cities. Safaricom saw this need and capitalized on it through M-Pesa.

Paytm

Paytm is an India-based fintech company that has become a pacesetter in e-wallets, mobile payments, and eCommerce. Paytm made its way to the market in the year 2010. The demonetization that followed lured people into using Paytm and became a torchbearer in an exceedingly cash-limited economy.

Users can store and transfer money from their wallets. They can use it to pay their electricity, gas, or phone bills, shop merchandise and also transfer money back to their bank accounts.

Paytm is currently valued at 8 billion with 250 million registered users and counting. The demonetization process heavily fueled the expansion that the corporate needed and made Paytm a household name in India.

Must-have Features in Fintech App Development

• Easy sign-in/ sign up
• Intuitive dashboard
• Secure payment gateway
• Account management
• User profile
• Push notifications
• Biometric security system

The preceding features are imperative in building a basic functional fintech app. Along with choosing from the top app development frameworks, Integration of other Industry 4.0 technologies like Artificial Intelligence can improve the user experience significantly.

While we speak about building a fintech app we must understand that creating a sophisticated app like such would require a skillful and experienced development team that will work on different domains such as coding, design, testing, and plenty more. App building costs can widely vary with the requirements.

Let’s have a look at the budget range for building a fintech app.

Cost to Develop a Fintech App?

Banking mobile app development can end up being a costly process if one doesn’t choose the correct IT service provider. Especially in regions like the US and Europe where the hourly development cost goes above 150 USD. Countries like India have quite a low hourly rate ranging anywhere between 25–50 USD/ per hour.

An Android or iOS app with simple features can cost above 10, 000 USD and would take about 2 months to develop. An identical app with moderate features would cost somewhere between 40, 000–80, 000 USD and may take 2 to 4 months to be ready for deployment. Whereas an advanced app with all the features will cost somewhere between 70, 000 USD — 1,50,000 USD, taking 4 to 8 months to be deployment-ready.

The app development process is actually a dynamic one. There are shocking fluctuations within the price and development time with the changes in technology, features, and development regions. If one needs a similar app to be developed using hybrid or cross-platform technologies, they will experience high variations within app development cost and time.