Are you interested in Fintech software development? Are you a startup owner or CTO looking for ways to invest in the rapidly growing Fintech industry? Technologies like Artificial Intelligence, blockchain, IoT, and big data analytics, have revolutionized the Fintech industry already, but these are only a drop in the bucket.
The market value for global Fintech solutions will reach 324 billion US dollars in 2026. This shows the massive potential for companies involved in the Fintech industry.
In this article, we will be discussing Fintech software development and how you can hire a competent team for Fintech software development.
What is the Fintech Industry?
Fintech stands for financial technology. The Fintech industry is rapidly growing by providing modern and convenient fintech solutions such as digital lending, digital payments, mobile banking, cryptocurrency, etc.
The latest technologies have enabled fintech software solutions to provide more convenient services than banks.
Big data, data mining, and machine learning algorithms have led to the development of user-focused software solutions that have revolutionized the way we think about our finances. As such, people are increasingly getting accustomed to the benefits of digital Fintech services without the need to physically attend their bank or speak on the phone.
The recent Covid-19 pandemic that threw almost every business into survival mode provided the Fintech industry with enormous growth opportunities. With everyone in lockdown, businesses and startups survived through online shopping and transactions.
Today, nearly every individual keeps at least one online payment mobile app on their mobile phone.
The following statistics on Fintech shed light on the size of the Fintech market.
Fintech Industry – Some Statistics
66.7% of financial experts believe Fintech will impact online mobile payments.
65.3% of Americans used digital banking services by 2022.
Global investments in the Fintech industry are valued at 33.9 billion USD currently.
The market value of the Fintech industry will reach 382.38 million USD in 2027. This growth is expected in the forecast period of 2020 to 2027, with a CAGR of 7.05%.
There are 10,605 Fintech startups in America.
The consumer adoption rate for Fintech services is 75%.
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Stripe is the biggest Fintech Company in the United States, according to Statista’s 2020 report. The company has a value of 35 billion USD.
The biggest fear keeping customers from using Fintech services is privacy and security concerns.
19.2% of Americans use digital voice assistants for banking activities.
According to the report by Coherent Market Insights, the worth of the mobile payment industry reached 195,000 million USD in 2021.
Fintech software development is a complex process. Any fintech product should be built using the latest technologies so that it can be competitive in the market. Moreover, financial technology solutions must comply with the strict financial laws and regulations in the country where they operate.
Before we get into how to build the right team, let’s discuss how a fintech product looks and functions. Understanding what features and functionalities to include in your fintech software will also help you build the right team for your fintech software development.
The Fintech Product – What does it look like?
Simple and Accessible:
A Fintech product’s primary objective is to make time-consuming financial processes easier. Any fintech product has a wide customer range.
Your fintech product should be accessible to every individual irrespective of their technical knowledge. The key characteristic to achieving this accessibility is a simple user interface and easy-to-use app design.
There are many functions that fintech software can provide but not every individual needs every feature. A personalized user experience is now expected by users thanks to the growth in artificial intelligence and automation techniques. Each user’s activity data helps the software to understand the user’s preference and modify the user’s experience accordingly.
Social media apps make the most of predictive machine learning algorithms to automate user preferences. Such techniques can also be used in fintech software development by showing preferred features such as monthly spending breakdowns to every customer.
Here is a blog article highlighting the role of machine learning in future software development.
User Data Protection:
User data security is of paramount importance in fintech software. The app should be built strictly in compliance with user data protection laws and regulatory policies. Many approaches are used to ensure maximum user data protection and confidentiality. Some of these are:
- Dynamic password change on multiple wrong password entry attempts;
- Multi-factor login authentication;
- Data encryption through encryption algorithms like RSA, DES, etc.;
- Role-based access control (RBAC) to various accounts containing sensitive data.
Many software applications use AI-powered chatbots now for better customer service to offset the delays associated with traditional call and email support.
The overall chatbot market is expected to reach 102.29 billion USD by 2026. Chatbots in the finance sector use cognitive techniques to understand users’ responses to provide better customer service.
Bank Account Integration:
An option to integrate and manage bank accounts makes a fintech product very appealing. It saves users from stepping into the bank every time they wish to organize payments or transfer money between accounts. Bank account integration allows users to do all these activities online.
Add on Plugin:
Different plugins for third-party financial services can be integrated to maximize the user experience. Features like credit card monitoring, loan management, data visualization, and budgeting can be implemented through third-party API integrations.
Choosing the Right Development Team for a Fintech Product:
An expert product development team for a fintech startup would include:
- Business analysts:
They gather detailed business and system requirements and present solutions to the client. This includes proposition development, risk analysis, risk management, consumer market research, new product development strategy, etc.
- UI/UX designers:
They research how users engage with the fintech products and the issues they face. UI/UX experts use this research to design a fintech product favorable to the customer’s use. They keep the user interface consistent across mobile and web applications. They also conduct design testing like A/B testing.
- Front-end developers:
They develop and maintain the user interface as designed by the UI/UX designers. They manage workflow on the mobile or web app.
- Backend developers:
They code the logic for the functional requirements of the fintech product. It includes data integration, server-side configurations, security implementation, etc.
- Quality Assurance Testers:
They test the fintech product to ensure that it is bug-free before the final deployment. This ensures that you have a high-quality product that works as required.
- Project Manager:
They manage the product development process by monitoring product development activities and ensuring the team follows the set requirements outlined to build your MVP. They ensure the development team and stakeholders are always on the same page when it comes to following the pre-planned product development strategy.
Your ideal software development team must have adequate financial industry knowledge, expertise in using the latest tech stacks, and high-level proficiency in communication.
You can go about the process of building the right development team in two ways:
Hire an in-house development team:
Building an in-house team of software product developers comes with the following benefits:
- A Single-Focused Goal:
With an in-house team of fintech software developers, you have development partners with a common goal. Every hired individual will be full-time on your project and have complete focus.
- Better Collaboration:
A single common goal will also lead to better collaboration. Every individual will work as a team member, and in-person meetings will help with better communication and better overall product understanding.
The disadvantages of hiring full-time developers are:
- Huge Cost:
The full-time instant availability of in-house software developers comes with a huge financial expense. Office rent and maintenance aside, you are completely responsible for providing all tools and hardware for working.
Having full-time employees also means you should have a proper employment plan. It includes salary increments, relevant training, health, and off-day benefits, tax payments, etc.
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- Slow Team Scaling:
Expanding an in-house software development team is also expensive. You will have to go through the whole recruitment process of publishing vacancies, conducting interviews, shortlisting, training, etc.
Hiring a developer for a specialized niche like fintech becomes more cumbersome, with many domain-specific technical skills to be mindful of when recruiting talent.
Outsource your Fintech Product Development to a Custom Software Development Company:
Outsourcing software development services is a huge market today. Some of the benefits associated with outsourcing your fintech project include:
- Access to a large pool of skills:
You can find the best talent available online. You can partner with freelancers or software development companies. No matter which you choose, they must have industry expertise, particularly in the finance niche.
Hiring individual freelancers is risky as the onus of vetting the freelance developer is completely on you. If they exhibit below-average performance or poor communication, you alone must reap the whirlwind.
In the case of outsourcing developers from a hybrid software development company, you should start by looking at the company’s services portfolio, case studies, and previous clients’ reviews on their websites for custom software development.
The best software development companies have a systematic process of helping to manage their outsourced developers with their own product development process that includes dedicated project managers.
For instance, at DevTeam.Space, we follow an AI-powered agile product strategy for rapid software development including performance reporting as well as timely communication with our clients.
- Save Resources:
A remote software development partner will save you from office setup expenses. Companies must pay for hardware, software licenses, office space rent, utilities, human resource management, training, and so on.
- Scale As Needed:
By outsourcing your technical needs, you can hire talent as and when you need it. This means you have enormous scope to scale your project development.
Hiring a local expert takes time, whereas hiring remotely is a swift process with many available candidates. You can tap into them as temporary expert partners for development tasks as your project requires them.
A few downsides of outsourcing your software project (to the wrong partner) include:
- Lack of effective communication:
A con of remote development partners is the lack of face-to-face communication. A difference in time zones may lead to hindrances in timely communication.
Today, however, there are many software apps like Slack, Teams, Zoom, etc. to ensure effective communication between team members, ones that allow face-to-face communication. Make sure your developers use them.
- Inefficient project management:
Remote software development partners require a different approach in terms of your product management process. Software development companies usually ensure efficient product management by having suitable development strategies and frameworks in place. Be sure to check this.
DevTeam.Space, for example, assigns a personal account manager to each client and a project manager to each developer or dev team. With this oversight, our account manager and project manager can keep a sharp eye on the process and flag up any potential roadblocks or issues long before they occur.
Skills to look for in a Fintech Product Development Team:
- Finance Industry Regulations and Policies Knowledge:
Finance is a strictly regulated industry, and any fintech product must be compliant with the regional finance laws in which the product will be used.
Your development team needs to be knowledgeable to incorporate the legal requirements in the design and development of the fintech product. Some examples of common regulation policies in the finance service industry are:
Electronic Identification and Trust Services is a European Union regulation for cross-border transactions. It provides a legal channel for cross-border financial activities between individuals and businesses.
It stands for Payment Card Industry Data Security Standard. It applies to any organization that collects and processes credit card information.
There are four levels of standards, and every concerned business should abide by these according to the number of transactions they process yearly. Credit card services like MasterCard and Visa validate their services according to PCI DSS.
This is a financial software development standard for information security. It helps organizations globally to implement a protected user data management system. The set of required standards depends on the company’s size. A few major security principles include cryptography, access control, and informational security.
- Hard Skills for Fintech Product Developers:
User data confidentiality and security are central requirements for any fintech product. Software developers should have sufficient expertise to ensure security at each product layer.
Fintech products are the primary target for hackers and frauds. Extensive security measures like data encryption, short login sessions, and one-time password (OTP) help keep fintech products secure for users.
The fintech product developer should know about the implementation of encryption algorithms like 3DES, RSA, etc. Moreover, familiarity with concepts like tokenization, Role-Based Access Control, and adaptive authentication is also an important skill to look for.
- Technical Expertise in Mobile App Development:
For building a fintech mobile app, your developers should be experts in the latest mobile application development practices. These include:
Native Android Development Skills:
If you plan to release an android app, then hire native android app developers. The native app development approach makes software for the target platform. The native Android app uses Android hardware and produces better app speed, memory management, and security performance.
The native android app developers should be well-versed in programming languages like Java and Kotlin. They should have expertise in using Android development IDE (integrated development environment) like Android Studio, Android Software development Kit (SDK), and tools like Android Jetpack for pre-built Android components.
Android app developers should be familiar with the app testing tools like Appium and Espresso. They should have adequate knowledge about app UI design and be familiar with the Google material design guide.
Native iOS Development Skills:
iOS developers work in the iOS ecosystem building apps for Apple products like iPhone, iPad, etc. If you plan to develop an app for the Apple store, hire iOS developers.
They should be proficient in the Swift programming language. Objective C is also used for iOS development, but it is considered hard compared to Swift.
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iOS developers use Swift extensively due to its well-developed feature library that helps build a secure and performance-efficient app more reliably and quickly.
Developers must be aware of Apple Human Interface Guidelines to develop a pleasant app interface consistent with Apple products. They should be skilled in testing Apple products using tools like XCTest and OCMock.
- Technical Expertise in Web Development:
When developing a web-based fintech application, your development team should have the following web-based technical skills:
Front-end developers should be familiar with utility libraries like jquery that are designed to help develop an interactive website in a straightforward way as possible.
These stacks provide a complete ecosystem to develop an app including, the front-end, back-end, database storage, and data manipulation.
- ETL and Database:
Fintech products are data-intensive. ETL task management and database management are crucial for fintech services. ETL (Extract, Transform, and Load) knowledge helps developers design and develop data storage solutions that best conform to business data needs.
- API Development and Integration:
API (Application Programming Interfaces) plays an essential role in developing modern software products. They allow communication between different systems.
In fintech products, data transfer between banks, individuals, customers, and sellers is a primary requirement. Therefore, look for a financial software developer proficient in API development tools and techniques like REST (Representational State Transfer) and third-party APIs integrations.
DevSecOps is an abbreviation for development, security, and operations. DevSecOps strategy compels developers to keep security a top priority while coding. It is essential for fintech products that require vigilant cybersecurity practices.
DevSecOps integrate security into all phases of product development from design, development, and testing, to deployment.
- Quality Assurance Testing:
Dedicate a separate team of testers for extensive product testing should you have the resources to do so. They should be able to run penetration tests and perform IT security audits.
Read our blog on top software development trends.
- Soft Skills Necessary for the Product Development Team:
Some of the soft skills required in software developers include the following:
Better communication and collaboration skills are necessary to follow the product development plan correctly. The use of communication apps like Slack and Microsoft Teams helps a great deal in maintaining effective communication.
The complex process of building a fintech service requires rigorous planning. Expertise in devising the best possible roadmap for product development to selecting the right tech stack for the project specification. Planning is crucial if you are going to build a fintech product that succeeds.
Fintech product development is an intricate process that requires a high level of trust and expertise from your product development partner. A minor mishandling of user data can lead to a law breach and severe consequences. Likewise, a poorly tested fintech product may land you in a miserable situation with grave legal consequences.
In order to prevent this, hire great developers, preferably from a fintech software development company. To do this, conduct a thorough vetting process while building your development team, keeping in mind all the finance industry-related expertise and technical skills you will need to check for.
Still unsure about choosing your fintech product development partner? Why not reach out to DevTeamSpace to see how our expert developers and dev teams can help? We are skilled in developing fintech products for businesses providing financial services.
Write to us your initial fintech project specifications, and one of our account managers will get back to you for further assistance and more information on our fintech software development services.
Top Three FAQs on How to Build the Right Team for Fintech Product Development?
Some of the fintech services include:
International money transfers;
Consumer banking is a primary use case of financial technology. Financial institutions like banking systems use financial software development services for back-end processes like monitoring user activity and for front-end services like a mobile app providing online payment solutions.
Some of the challenges that may arise for fintech product development are:
Underdeveloped business development strategy;
Poor market research;
Financial business intelligence;
Maintaining software quality;
Keeping up with the finance industry regulations.