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The Ultimate Guide to Building Efficient and Secure Fintech Appsby@vb2
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The Ultimate Guide to Building Efficient and Secure Fintech Apps

by VarunNovember 14th, 2021
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The Fintech market is growing at a rapid rate, and it's expected to reach $309.98 billion by 2022. The industry has made waves within the financial sector by creating secure and efficient digital platforms for many companies to operate. As of February 2021, there were 10605 such businesses operating across America - more than any other area on Earth! The U.S. is home to many fintech startups, making it the region with the most globally-ranked companies in this field.

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Today, the Fintech market is growing at a rapid rate, and it's expected to reach $309.98 billion by 2022 with an annual growth rate of 24% as per the PRNewswire.

Surprised?

Well, "Fintech" is an amalgamation of two words: "financial services" and "technology." This new field has emerged as a result of the rise of technology, specifically the blockchain. 

The 40% of financial service companies looking forward to blockchain's adoption in Fintech indicate its potentially massive impact on the industry. (Source: PwC)

Besides, the industry has made waves within the financial sector by creating secure and efficient digital platforms for many companies to operate. As per the recent software development stats, Fintech startups in America, Europe, and the Asia Pacific areas are booming. In 2021 10,605 such companies were operating within each region!

Firms worldwide use Fintech applications to serve their customers more efficiently while simultaneously enhancing security measures. Since such apps are scalable, scalable, and versatile, they have become a trendsetter in the industry.

If you are a startup business looking to develop an efficient Fintech app, here are some Fintech app development strategy tips for you to make the development process easier.

FINTECH STRATEGY TIPS: GIVING UP FREEDOM FOR SECURITY

For fintech apps, security is of utmost importance. Fintech companies are constantly under pressure to adhere to strict security protocols because such applications handle very sensitive data daily. If this data is compromised or intercepted by an unauthorized person, businesses can be crippled in terms of data loss.

So, let's check how to develop Fintech apps with security in mind.

1) Set Your Goals

Before Fintech app development begins, the business giants must know what they are building. Goals provide startups with a direction. It is important to prioritize goals since it will help you focus on what is more important to the company.

The U.S is home to many fintech startups, making it the region with the most globally-ranked companies in this field. As of February 2021, there were 10605 such businesses operating across America - more than any other area on Earth! In comparison, Europe has 9311 firms while the Asia Pacific has 6129.

Image Source: Statista

You should set your goals by taking into consideration two components: customer experience and business advantage. These two parameters should help you define what kind of application would meet your user's needs better while increasing the business' profits by increasing customer satisfaction.

What are you trying to accomplish? That question should be at the front of your mind before you start the app development process or hire a web application development company.

2) Conduct Primary Research

To build a highly secure Fintech application, it’s essential to conduct primary research. Conducting primary research means surveying people who will be using your app or product, as well as those who could pose a security threat. It also means identifying potential problem areas by researching past instances of security breaches in other applications. 

Ensure that you have answered all of your questions before moving on to secondary research—if you don’t understand something, write down your confusion to figure out where to find more information later.

3) Choose Your Tools

Banks are constantly creating new applications for their customers to feel secure and flexible while using different services. If you’re planning on building a highly secure application, it’s essential to choose your tools wisely. Selecting older technologies may leave you open to vulnerabilities, while newer alternatives may not be ready for real-world implementation. 

Find out how modern developers are integrating blockchain technology into their applications—and which platforms they’re using for each step of development—to streamline your approach. 

We also recommend hire blockchain developer who can use Blockchain development tools like Hyperledger Composer, R3 Corda, Ethereum, and Quorum to create a secure blockchain app. Such tools make use of relevant cryptography to provide a highly safe environment for developing financial applications.

It's the best strategy for Fintechs and banks to integrate blockchain technology into their applications to make them more efficient. You can also use the API security developer tool for enhanced API security. 

Blockchain and other technology like AI also play an essential role in developing highly secured apps. The reason why experts say-Artificial Intelligence is the future of banking and its value will reach $79 billion by 2030 (Source: IHS Markit).

4) Decide On Development Strategy

There are two primary routes for building your Fintech application—you can either outsource or build it in-house. If you’re just getting started with Fintech, it’s unlikely that you have experienced developers on staff, so you’ll probably need to look elsewhere for help building your application. 

Deciding on a development strategy is critical. Here’s what you should consider: 

  • Do I want to own my data? Is my idea patentable? 
  • How long do I want/need my app to be available?
  • What kind of resources do I have? 
  • Do I want to continue using third-party services (e.g., Salesforce) as we scale up? 
  • Who else will use my product besides me? 
  • Are there any regulatory hurdles I need to consider before going forward? 
  • Will others see value in using our app? 
  • Is there a market opportunity here, or will our efforts go unnoticed by users and investors alike? 

A lot goes into making these decisions; that said, sometimes, even if it seems like you don’t have all of these answers at once (or ever), at least knowing some questions is better than not having any ideas at all. So, hiring dedicated developers can offer a better guide to Financial Technology and related services.

5) Write Secure Code

As in any other industry, security in applications is a top priority. Any vulnerability in your software could be exploited by hackers and expose your users’ data. However, hackers are clever, so you must learn that your development team writes secure code when building your application.

Code is the brain of your application, and it’s imperative in a Fintech app. It’s essential to maintain clear documentation while writing secure code—otherwise, you could miss errors that hackers will later exploit. 

Some programmers may even avoid including security measures in their code because they don’t want to worry about attackers exploiting weaknesses in their software. But without paying attention to security, vulnerabilities could put both customers and data at risk—which would defeat the purpose of developing a new fintech application entirely. 

Be sure to prioritize safety as you build your new platform; it will pay off long-term if used correctly. The more thorough your documentation, the less likely it is that you’ll miss an error while developing. And, more importantly, it will save time on application maintenance and testing later.

6) Plan Your Testing Strategy

When developing a Fintech mobile application, it’s essential to build in ample time for testing. The earlier you can identify potential security risks or technical glitches, the better. Before your application goes live, set up a test group of real users to try out your product and give feedback. 

Besides, this will allow you to identify issues before too many people have been affected by them while also providing valuable information about your user base that you can use when expanding upon features.

7) Integrate Security in Your Regular Workflows

With new fintech apps being released each day, it’s becoming more critical than ever for companies in this industry to focus on app security. We spoke with experienced Fintech app developers who explained how you could successfully combine security into your regular workflows. Here’s what they had to say: 

  1. Don’t wait until someone hacks your app; instead, begin reviewing and updating your security protocols as soon as possible. 
  2. Integrate effective encryption practices into your development process. 
  3. Keep up-to-date with changes to relevant security laws, such as GDPR and CCPA. 
  4. Read reputable news sources and keep track of trends that may affect your company in any way—this will help you be prepared for potential breaches before they happen. 
  5. Work with a team that knows what they’re doing when building secure applications. And don’t just take our word for it—here are some tools that can help you find a developer who fits all these criteria! 
  6. Look at their website, portfolio, and LinkedIn page. 
  7. Check out their Twitter account (if they have one). 
  8. Look them up on AngelList or Crunchbase 
  9. Check out what kind of clients they’ve worked with within the past. You could also ask for references from them directly or simply reach out to previous clients directly. 
  10. Most importantly, consider whether or not you trust them (and make sure to read through every line of code yourself thoroughly)!

8) Have a Solid API Security Strategy

It's no secret that a highly secure API strategy is key to a successful app development process. As such, security must be at the forefront of any Fintech app development strategy from start to finish. Here are a few tips on how you can implement a solid API security strategy in your own company or project: 

• Develop end-to-end encryption.

Developing end-to-end encryption is not easy, but it’s necessary if you want your users to trust your application; if they don’t trust that their data will remain private, they won’t use your application. 

• Use multi-factor authentication (MFA). 

Suppose someone tries to gain access to sensitive information without having the correct credentials, set up multi-factor authentication (MFA) protocols that require additional verification steps before access is granted. 

• Stay up-to-date with emerging threats. 

Hackers are always coming up with new ways to break into systems, so you must constantly update software whenever new flaws are discovered. 

• Educate yourself about industry best practices for building applications.

The more you know about common vulnerabilities, exploits, and attacks across different sectors, the better you’ll be able to keep your applications protected. 

• Encrypt transmissions whenever possible.

Always look for opportunities to send data through encrypted channels—even when it doesn’t seem like much sensitive information is being shared—as these small efforts can help prevent more powerful hacks down the road by slowing down hackers who are trying to crack codes in real-time. 

9) Have an Authorization, Authentication, & Identification System Ready

Whether you’re working on a new Fintech app or looking to revamp your existing one, you must have a solid authorization, authentication, & identification system ready from day one. In many ways, your app is only as good as your security. 

With identity management handled via tokens, tokens will be used in conjunction with centralized systems for maximum efficiency and security. This is how you can create a safe fintech application from start to finish.

10) Use Payment Blocking

Did you know that more than $20 billion is lost each year due to fraud? With numbers like this, you can understand why payment blocking has become a popular tool for preventing fraud in fintech and e-commerce applications. 

Most financial institutions use payment blocking software that monitors transactions across networks. When a block is triggered, a message will appear on your screen notifying you of a failed transaction. 

Payment blocking is a technique that stops fraudulent transactions before they can happen by automatically detecting suspicious patterns, such as the same item being purchased from different credit cards over and over again. 

To implement this solution, you’ll need to have a solid payment blocking system in place that works with your authorization, authentication & identification systems.

These were just a handful of tips on how you can create a security strategy & more in your Fintech application. A highly secure approach is key to the success of any application, so don’t wait until your business or users are harmed. Act now!

Now, you know how to create a highly secure strategy in your Fintech application. In addition to the tips & strategy mentioned above, you can always consult a professional who creates unique security systems whenever you need additional guidance. 

Hire a top Fintech app development company that can help your business launch a secure app for all of its users. Furthermore, let's have a quick look at some of the FinTech Use Cases.

FinTech Use Cases

Lemonade: It is an insurance company that is operated entirely through a self-serve app with the help of machine learning.

Acorns: It is an investment app that rounds up your everyday purchases and invests them into various assets.

Coinbase Commerce: A merchant services payment platform allows merchants to accept digital currencies in their online stores. Over 800 live websites use Coinbase Commerce, and they are all over the world!

Image Source: Builtwith

Robinhood: This fintech startup gives users access to commission-free stock trading via its mobile app.

Plaid: It offers a software platform that enables developers to integrate their services quickly with banking applications.

SoFi Personal Loans: This fintech startup disrupts the finance industry by providing fixed interest rate personal loans. 

Now, let's know different Types of fintech applications.

Types of Fintech Applications You Can Have

1. Money Transfer and Payment Systems:

The idea of quick and efficient payments has been gaining traction ever since the blockchain came into existence, at least when it pertains to financial services. 

Fintech startups such as Ripple could take advantage of blockchain technology to make international transfers easier and faster than traditional methods (such as SWIFT) ever could. These fintech startups have made the transfer of anything from small to large amounts quick and easy, making them a significant threat to traditional financial service providers.

2. Budgeting Apps:

Budgeting apps are nothing new, but they have become more prevalent due to the rise of cryptocurrencies. 

When companies are looking for ways to increase efficiency and save millions of dollars, integrating cryptocurrency becomes essential. A fintech development firm with expertise in both Blockchain technology as well as mobile app creation can help your business integrate cryptocurrencies into its budgeting platform successfully! Here's where some countries stand when it comes down to whether or not they've adopted crypto so far:

Image Source: Financesonline

3. Stock Tracking Apps:

The stock trading industry has seen a great deal of change in recent times. Thanks to the rise and fall of cryptocurrencies, traders and investors alike have adapted to utilize many different technologies for their gain. 

There is now a surge in fintech startups that aim to make the experience easier and more efficient via mobile apps, which are attractive to customers because of their sleek design and instantaneous access.

4. Insurance Apps:

The insurance industry has seen a lot of change in recent years, caused by the widespread adoption of mobile technology. 

Fintech startups such as Lemonade have been at the forefront of this trend; they operate entirely through a self-serve app and use machine learning to offer tailored insurance policies to customers. This has made the requirements for mobile app development quite stringent, which is why working with a fintech development agency becomes essential.

5. Cryptocurrency Exchange Apps:

Cryptocurrency exchanges are the primary venues for trading cryptocurrencies and fiat currencies. Operating through apps allows users to convert their tokens into cash in a fast and efficient manner. 

Exchanges are necessary for the growth of the cryptocurrency market, so there is increased competition between companies operating in this area. As such, it’s crucial to have a mobile app development strategy that assists you in standing out from your competitors.

6. Lending Apps:

In recent times, peer-to-peer lending has become a big trend. This is primarily because people are tired of banks and other financial institutions not giving them credit when they need it most. 

Because of this, companies like Lending Club have gained widespread appeal in the form of investment opportunities; users can invest in different loans and earn interest without waiting for settlement. This has made the requirements in terms of mobile app development quite stringent.

The COVID-19 crisis has caused a rise in the number of users on investment and lending platforms, with an increase of 23% for each type.

Image Source: Mckinsey & Company

7. E-Commerce Apps:

The e-commerce industry has seen a great deal of growth in recent times, caused by the widespread adoption of mobile technology. 

Mobile commerce now accounts for over 30% of all U.S. retail spending, which is why many fintech startups are now focusing on ways to make mobile payment and e-commerce easier for businesses and customers alike.

This has made the requirements for mobile app development quite stringent, which is why working with a fintech development company becomes essential.

Conclusion

A fintech app development strategy is incredibly important, especially if you’re looking to develop a new application. The fintech world moves incredibly fast—faster than any other industry—so your application must meet all of today’s standards. 

Take time planning out your development strategy before jumping into actual production—and hire a top-tier developer of a financial software development company in India for your project.  They’ll be able to help you formalize an effective plan in no time. Good luck!

FAQs

Q1: How to create a fintech app?

Ans: There are various steps involved in the creation of a fintech app. You need to analyze your industry and understand what kind of app will serve maximum benefits for your business at this point.

Here are some steps to create a fintech app:

  • Conducting market research and identifying the problem areas/pain points
  • Understanding customer preferences and choosing an appropriate technology to address their concerns
  • Deciding whether to build your own technology or license it from a third party, based on your resources and requirements. 
  • Choosing a business model – whether to monetize the app through advertising or by providing a paid service
  • Ensuring that your network infrastructure and mobile devices can support an app
  • Understanding the requirements of building for specific platforms – Android vs. iOS – and choosing accordingly
  • Putting in place strategies for updating codes, resolving bugs, etc.
  • Designing an appropriate UI/UX for your target audience 

Q2: How much does it take to create a fintech app?

Ans: The cost of developing a FinTech app can vary anywhere from $50,000 to $300K. However, the amount is determined by many factors and depends on how tech-savvy you want your finished product - so be sure to set your budget before proceeding.

Q3: What is the difference between a fintech app and a banking app?

Ans: Fintech apps will help you with many things, such as managing your money, loans, investments, bills, and taxes. These applications generally support both online and offline transactions. A Banking App, on the other hand, will only allow you to transact online.

Q3: How long does it take to create a fintech app?

Ans:  The time taken to create a fintech app mainly depends on its purpose and the level of customization desired by the customer. On average, it takes around six weeks in India to develop a fully working prototype for your idea.

Q4: What is a FinTech strategy?

Ans: A FinTech strategy is a plan that you should follow to implement your vision into reality. It includes defining, planning, and coordinating resources to achieve business goals while maximizing profits.

Q5: What are the benefits of using FinTech apps?

Ans: Fintech apps provide a wide range of benefits to businesses, including:

  • Reduced operational costs
  • Improved business efficiency and productivity
  • Accelerated transactions – the ability to do transactions in real-time
  • Customer convenience – access to financial services anytime, anywhere 
  • Enhanced ROI for existing customers and engaged with new ones