In 2021, the fintech industry experienced a significant surge, due to the development of new technologies. This investment surge gave rise to the introduction of new services and products based on the cutting edge technologies. Therefore, it is the ideal time to enter the profitable fintech market. In this article, we will explore recent trends within the mobile fintech industry, the process of how to create a fintech app and what technical features customers are looking for in your financial product.
Fintech App Development Trends for 2022
To create a successful fintech app, you must integrate several technologies. Privacy and security must be at the forefront of the development process, with robust authentication and authorization systems in place. Payment gateways enable cashless transactions and ready-made solutions like Stripe, PayPal, and Braintree can be incorporated. Push notifications provide updates on services as well as engaging content, while dashboards and reporting enable users to view their assets, spending, and incoming transactions. AI-powered chatbots allow for effective user journeys and up-selling, while APIs and QR codes enable faster payments and card number scanning. Beside the essential features there are a few top trends presented below.
Blockchain
Blockchain technology is playing a major role in the advancement of the modern fintech revolution. With its decentralized and immutable characteristics, blockchain can disrupt traditional financial processes and make them more secure, transparent, and efficient. Studies have shown that it can result in up to 25% better customer experience and 40% improved efficiency. As of December 2021, there are over 4000 decentralized applications, with 374 new ones entering the ecosystem. Popular applications of blockchain include decentralized exchanges, lending, crypto trading, prediction markets, and other Defi solutions.
Artificial Intelligence
AI is a common component of digital solutions, particularly finance. In 2020, AI in fintech had an estimated market worth of $7.91 billion and is projected to rise to $26.67 billion by 2026. Smart technology has a broad range of uses in fintech, ranging from fraud detection to churn prediction to optical recognition. AI optimizes trading activities and personalizes customer service.
Big Data
Customers today anticipate that businesses have an understanding of their requirements, with 66% expecting it. In the financial technology sector, customer understanding comes from the intelligence gotten from Big Data. This data is created from such things as credit scores, transactions, and other financial applications. Using this information, firms are able to predict customer behaviour, modify bank rules, and make plans for further development.
Microservices
This year, 37% of organizations have recognized the advantages of microservices architecture for fintech mobile app development. It is characterized by a modern database structure that makes scaling simpler than with traditional systems, as well as improved security, smoother integrations, and faster deployment. Thus, it is a great approach for those looking to build a fintech app that runs quickly and dependably.
Seven Steps for Developing a Fintech App:
1. Choose Your Niche and Ensure Legal Compliance: Before starting the development process, you should assess the market viability of your future solution. To do that, decide on the app type, target audience, and main competitors. Additionally, research the target market to ensure compliance with legal regulations such as GDPR, CCPA, and Financial Action Task Force Recommendations.
2. Shape the Concept and Define the Feature Set: Solidify development requirements and business objectives by deciding on the main requirements of the future solution and creating a detailed project description. Based on the competition and user insights, evaluate how relevant each feature is.
3. Design Compelling UI/UX: Bring the app’s exterior to life by establishing a coherent design strategy based on content requirements, competitor research, user personas, stories, and customer journeys. Create a final layout with a detailed design description and covering the states of all app screens for developers.
4. Choose the Development Approach: Based on the system specification and complexity of the project, decide on a relevant tech stack and team structure. Consider factors such as app functionality, flexibility and scalability requirements, time to market, system load requirements, platforms, security requirements, and automation objectives.
5. Estimate Time and Costs: After the planning stage is over, your tech partner will estimate the costs and timeline of your project. Assess the pros and cons of different engagement models such as fixed price or time & material.
6. Develop an MVP: Create a minimum viable product (MVP) with a minimum set of functions that is enough for end-users to test the application. This allows companies to test the waters without huge investments and to make improvements to launch a full-fledged application.
7. Improve and Support Your Fintech App: Application maintenance is important to ensure your solution remains competitive and user-friendly. Regular maintenance activities are especially important to cover growing user and technical needs.
How to Monetize Your Fintech App
The way of making money from a financial solution can vary depending on who benefits from it. Users, external services, and in-app purchases are all possible ways of generating profits. After releasing the app, additional sources of income can be added, yet it is important to maintain a steady and consistent business model.
Subscriptions: A subscription-based model is one of the most common revenue models for all app types. In this case, users pay a recurring fee to access the app and can be offered a trial period first.
Transactional Fees: Within this model, the user pays a fee each time a transaction is made through the application. Transaction fees are applicable either to all payment types or specific transactions.
Referrals and Ads: Referral programs are deemed one of the most profitable collaboration approaches between the company and its partners. Fintechs integrate with third parties that offer value to the app users, be it accounting services or additional fin-tools.
Paid API Access: Just like you can buy someone’s API, you can also provide your own if you are a payment gateway. Reusable functionality can be offered on a subscription or pay-as-you-go basis.
Data Monetization: Fintech is a rich source of valuable user insights. These may include purchase history, spending habits, average spending, and other customer habits. The immensity of this information can then generate valuable insights for your partners.
The Future Is Fintech
Fintech is a rapidly-growing sector in the global business world. With the combination of blockchain, AI, and other technological advances, the financial realm is being shaped in a whole new way. Mobile applications make use of this tech combo and make transactions simpler for users. Creating fintech apps is a difficult process, though, and requires a great deal of knowledge and the highest security standards. If you have any questions about how to build fintech apps, please contact us and our experts will be happy to help.
