Fintech app development: market trends, application types and features

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Fintech is a new technology that effectively improves and automates the delivery and use of financial services. Traditional banking appears to be on its way out since fintech apps saturate the market and boost profitability in the financial industry.

The creation of fintech apps is becoming extremely popular on a global scale. The financial sector is now being driven by digital innovation at a fast pace thanks to the rising use of mobile technologies. Fintech has experienced rapid growth in recent years, and this trend is set to continue till 2030. 

The fintech sector growth is driven by increased demand for digital financial services, including online fund transfers, mobile banking, digital wallets, and a faster, safer, and more seamless client banking experience.

With a CAGR of 26.2% from 2022 to 2030, the worldwide fintech industry is anticipated to reach USD 936.51 billion, TheBrainyInsights reports. Increased investments in technological solutions, rising smart device usage, expanding internet penetration, and increasing digitization of commercial services will all contribute to the growth of the fintech market. In this article, we will cover the main types, and features of fintech apps, and also provide a guide on fintech app development. 

Why should you create a fintech app?

Companies around the globe increasingly utilize fintech solutions, so they are aware of the benefits of top-notch tools for transaction facilitation. Fintech apps are profitable, secure, and time-saving for businesses. Application programming interfaces, artificial intelligence, blockchain, and data analytics are just a few of the technologies that fintech plans to use to compete with current traditional banking methods in the delivery of financial services. 

The digitization of financial services has several features, such as easier end-user access via mobile apps, faster, automated operation processing, lower costs, convenience of use, and higher transparency.

With easy-to-use services and transparency in terms of financial features, fintech has been one of the market’s major driving forces. New technologies implemented by financial institutions to deliver value-added services to customers are driving continuous industry growth.

The fintech market is also characterized by a fast expanding number of startups and organizations without bank licenses (non-banks). Fintech startups frequently concentrate on particular segments of the financial value chain while attempting to disconnect from traditional bank business models.

The value of the global fintech market is estimated to be USD 112.5 billion in 2021 and to increase to $332.5 billion by 2028, Vantage’s research claims. Experts predict that over this period, the global market will expand at a compound annual growth rate (CAGR) of 19.8%.

At the same time, according to Allied Market research, the global fintech technologies market size is predicted to reach $698.48 billion by 2030, increasing at a CAGR of 20.3% from 2021 to 2030. With new technology implementations, such as application programming interfaces, artificial intelligence, blockchain, and data analytics, fintech aims at winning the competition against traditional banking.

Take a look at some key data offered by Statista, based on market evaluation, key players, and industry analysis, to evaluate the growth of the industry.

  • Digital Payments, with a total transaction value of $8,488 billion in 2022, will be the market’s largest category.
  • In the Alternative Financing market, it is anticipated that the average transaction value per user will reach $27.10k in 2022.
  • In 2023, the Neobanking sector’s revenue is expected to increase by 42.2%.
  • By 2027, 5,480.33 million users are expected to use digital payments.
  • In the digital payments market, the total transaction value is anticipated to reach $8,488 billion in 2022.
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The top fintech sectors

Users of fintech fall into one of four major categories:

  • Banks’ B2B
  • Corporate clients solution
  • B2C for small companies
  • Consumers

Fintech application types

Blockchain, big data, robotic process automation, artificial intelligence, and other technologies are all used by fintech enterprises. By using AI algorithms, financial companies can gain insights into customer spending patterns. Another AI-driven tool banks are beginning to adopt to assist with customer care is chatbots.

Big data can be used to develop new strategies, study consumer spending patterns, enhance fraud detection, and develop marketing plans by forecasting client investments and market developments.

Process automation is a branch of artificial intelligence that automates particular repetitive processes. It facilitates the faster and more accurate processing of financial data, including accounts payable and receivable.

Blockchain is a new financial technology that has attracted considerable investment from numerous businesses. Blockchain’s decentralized structure can remove the need for a middleman to carry out transactions.

Fintech businesses come in a variety of types nowadays, and they are typically grouped according to the industries that their clients work in. Examples of these include:

  • Online payments
  • Lending
  • International Money Transfer
  • Financial Services
  • Investing in equity
  • Customer Banking
  • Insurance

Online payments

Digital payments refer to transactions that are speedy, secure, and cashless. Digital payments are facilitated by fintech apps with online payment systems, e-wallets, and digital currencies. It tends to be one of the most well-known fintech sectors. Consumers can now purchase online from their homes thanks to fintech. Users can pay their bills using their mobile devices from anywhere in the world. They can open and manage an account without physically going to a bank. Transfers and mobile wallets have made sending and receiving direct deposits super simple.

Internet Banking

Banks create fintech apps for their customers because digital banking has evolved into a very practical alternative for both consumers and bank staff to manage client data. Institutions of traditional finance must change to fit the times. Even the most conservative institutions are undergoing a digital transformation due to the range of fintech solutions available. Their mobile banking applications expand their offerings and meet customer expectations. Fintech apps for digital banking enable customers to manage their bank accounts online without having to visit a bank for every little question.

Trading and Cryptocurrency

The stock market has been influenced by fintech too. The use of cryptocurrency is expanding due to new fintech services. Users can transmit and accept cryptocurrencies thanks to fintech, which gives them access to digital cryptocurrency markets. Blockchain is the primary technology that powers cryptocurrency trading. 

Blockchain protects cryptocurrency transactions and almost eliminates data manipulation. Fintech has also widened access to the trading sector, allowing everyone with an Internet connection to test their skills and luck. A couple of years ago, it was only done by experts. As a result, there will be more investment in stock markets worldwide.

Lending

Loans, money management, and saving are all personal services at the core of deposits and lending. It is a subset of fintech directly related to personal finance, assisting people and households with financial decision-making and budgeting. Deposit and lending fintech has produced “buy now, pay later” and microcredit services that let users pay for products by dividing the price into four payments. On a mobile device, it takes just a few taps to complete the process. Loans and credit ratings are available to customers online through alternative lending sources instead of complicated procedures in conventional financial institutions.

Apps for managing personal finances

With the help of personal finance applications, users may keep track of their earnings and spending by classifying them into useful categories like food, health, energy, transport, etc. This software eliminates the need for Excel sheets or handwritten cost entries in a notepad. These solutions frequently provide simple tools and engaging experiences. Fintech apps for consumer finance assist their users in managing their finances. Users of these apps are given the tools and capabilities they need to effectively manage their spending, and create budgets.

Now that you are aware of the multiple types of fintech apps, let’s examine the various cutting-edge trends in fintech application development.

Check also our article “Digital banking trends propelling the industry”. 

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Fintech market segmentation

The segments of the global fintech market include deployment mode, application, technology, services, and end user. Based on deployment mode, the market is divided into On-premise and Cloud segments. Based on application type, the market is divided into Payment & Fund Transfer, Loans, Insurance & Personal Finance, Wealth Management, and others. API, Artificial Intelligence, Blockchain, Process Automation, and Data Analytics are the segments based on technology. Finally, the market is divided into two categories based on the end user: banking and insurance.

Payments and fund transfers, personal finance, loans, insurance, and other services make up the services segment. Payments and fund transfers accounted for over 34% of global revenue in 2021, dominating the market. This niche will be driven by the rising need for mobile-based financial services that enable fund transfers and payments. The segment will rise as a result of new inventions that make secure and convenient payments possible.

From the end-user perspective, banking dominates the fintech market, and is anticipated to continue to do so for the years to come. Numerous crises have acted as drivers for the growth of the fintech market, so the investments in the industry have risen. The sector’s expansion is also a natural reaction to the weaknesses in the conventional financial services sector that are revealed both during and after the crisis. 

Recent developments in fintech make use of cutting-edge technology tailored for certain uses or industries. Rising automation and digitization of banking are pushed by increasing competition in the industry.

How to build a great UI/UX design for fintech apps?

In the development of fintech apps, UI/UX design is crucial. You need to define the layout that will offer your customer the maximum benefit and convenience of use. Software usability testing is essential to ensure that the features you are providing are helpful to the user. Otherwise, you will waste time and money on a useless feature. 

Both looks and functionality of your fintech app are important since they determine whether a user will stick with it or try something else. A well-designed financial application will always work smoothly. An app for a mobile financial service should function just as users would expect. Let’s see the key components of an effective UX/UI design:

  • The software should employ symbols, colors, icons, and buttons that users are already familiar with. The adoption of standardized elements by designers will make your software more convenient and user-friendly. 
  • Your software should be simple enough for a typical user to operate without a manual.
  • App loading speed: nobody wants to wait long for an app to load. The slower the app is, the less prospective customers will use it.
  • Quick access to the bank account. When it comes to financial services, functionality is crucial. Users should be able to enter their bank accounts quickly thanks to a clear structure. Access to financial services right away is essential. 
  • One-click access to all accounts and a user-friendly straightforward panel is essential. All accounts inside the same application should be instantly accessible to users of a financial service app. Users will value having access to deposits, expenses, and credit cards, as well as a comprehensive financial history, all in one location.
  • Today, paying bills and transferring money is as simple as sending an email. Make sure the process of transferring money does not consume a lot of time and effort when creating a financial service app. It should be simple to locate and click the “Confirm” button.

These points listed above are a base to increase the chances for your fintech app to be successful. To better grasp how UX and UI aspects impact the overall feel of a fintech app and user experience, let’s go further into must-have features.

Must-have features for fintech apps

For a fintech application to not be overcrowded with unknown concepts to create a solidity, compare what you have to what your competitors have. Provide something quicker, wiser, more cost-effective, and more user-friendly. Here are several features that must be available in your fintech app.

UI simplicity

One of your first objectives as a provider of fintech services is to eliminate any kind of difficulty associated with using your services. Exchange rates, investments, loans, and other complex concepts should all be made simpler for your users as part of your seamless fintech app development process. Set up your users for long-term retention by providing an intuitive user experience, easy navigation, and instructive content.

User-focused navigation

Simple navigation is an essential component of app engagement. Many people, however, are unaware that the purpose of navigation is to shorten the amount of time a user spends using the app. Your objective remains the same: users should navigate your app as fast and easily as possible. That entails getting rid of any hurdles that stand in their path.

Vocal assistance in banking

A rising trend in fintech and digital banking is voice-assisted technologies. Customers using voice-assisted banking can deliver voice instructions to the app to complete tasks. The digital voice assistance trend pushed banks and other financial institutions to start including this feature in their apps. As opposed to tapping and typing commands, voice directives can make using a banking app incredibly convenient and quick.

App security

Since users entrust you with private information about themselves and their finances, security in a fintech application is crucial. You can utilize encryption techniques, biometric and two-factor authentication, or even blockchain technology, to offer a high level of security. Since fintech apps handle the most private consumer data, security should be given top attention. Make sure the app limits failed login attempts and only shows the last three card digits.

Biometric login

Although the entire finance ecosystem is expected to be bulletproof, app security is one area where researchers are still working to improve functionalities. Your app needs to be unbreakable when money is at stake. Including biometric features in your app is an efficient way to handle this. This feature might include fingerprint access, and software for facial recognition, additional layers of protection against unauthorized app access.

Visualization of financial data

A great way to improve user experience and retention is data visualization. When information is given graphically rather than through a text, we are more efficient at understanding and processing it. Therefore, visualization is a crucial tool for turning complicated financial terminology into something the user can understand. Using visualization can help you spot patterns and trends.

In addition to being simpler to process, visualized data is far more entertaining to look at. This can encourage consumers to pay attention to the information they might otherwise ignore. The optimization of data visualization for mobile phone screens, however, is a significant barrier to fintech app development.

Financial gateway

Without the ability to make payments, a fintech app could not exist. Integrate one payment gateway or even more so that users can transfer money easily on your platform.

Notifications

When discussing apps, notifications and a good user experience go together. People enjoy getting individualized user experiences, learning about new app features, and special offers. Notifications will also bring many benefits for financial companies: they boost conversion rates, increase user retention, and track user analytics.

Scanning QR codes

Give customers the option to simply scan QR codes rather than enter digits, which would save time. This is a much more practical and error-free method of managing financial operations. Your app’s users will find it simpler to use the program thanks to this functionality. Adding a scanner to your software is a smart idea because many apps these days use QR codes.

Personalization

Give your users the option to personalize the financial app to suit their needs. There are many dashboard customization choices available, such as altering the application’s font size or changing the theme from light to dark.

Simple APIs integration

To make things simpler for the consumers, the majority of high-end fintech apps will need to integrate with other applications. To connect the two platforms, you must ask the users to obtain an API key. It is recommended to streamline the process of integration rather than imposing technology on your users. 

Connecting to other programs to exchange data can boost sales and provide your product with advanced features. Users can plug in information about their accounts, find the location of the closest ATM, or use PayPal to make an online purchase with the use of API integration.

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Development of fintech applications

For the past few years, startups, banks, and financial institutions have been using fintech applications to expand their businesses and generate revenues. Both business and consumers profit from fintech solutions since they make it simple and quick to get financial services whenever they need them.

Through the use of mobile devices, the fintech market has effectively offered its clients secure, practical, and scalable financial services over time. Because of this, companies that are new to the industry or are considering investments in it today face pressure to develop something special to attract clients.

Blockchain, artificial intelligence, machine learning, and other technologies can all be used to build fintech applications. These technologically advanced digital solutions assist in streamlining and improving the access to financial services.

The creation of a fintech application begins with a concept and the associated costs and concludes with application design, programming, and debugging. Below we will explain how to create a fintech app, what tendencies affect the industry and share useful tips.

A step-by-step guide for fintech app development

Any fintech app demands work and close attention to platform security and regulatory standards. You will also need to create a product that appeals to your target audience. Our step-by-step plan for creating a successful financial app will help you to deal with these tasks.

Define the app type

You must first choose the market niche for an application. Will it be a payment app, personal finance, investing, or online banking solution? Depending on the kind of application, look for your target market and assess your main competitors.

Perform market research

You need to determine your fintech product’s market, research your rivals, and identify your audience. Then sketch out a plan for your application, and emphasize its advantages. Before creating an app, fintech software developers have a lot of research to complete. To finalize the appearance of the interface and the functions the app will provide, you must create a map that outlines your strategy. It is also important to be explicit about the MVP’s (minimum viable product) scope and its capabilities.

Choose a technology stack

Once you know which kind of app you want to create and for which market, you will need to choose a tech stack for the project. There are several languages for fintech application development. Furthermore, the time and money required for development are typically determined by the language chosen. You have the option of developing native apps (creating distinct apps for Android and IOS), cross-platform apps (writing a single codebase for both), or Progressive Web Apps (PWA).

The best user experience and performance may be found in native apps. The software is created under all technical and UX standards for a certain OS. They are safe and include convenient built-in features like a camera, geolocation, and more. But building native apps takes a lot of effort and requires a big budget.

Cross-platform applications are created using a single codebase that works with any OS. One can employ a limited team of engineers who can create a cross-platform program in a reasonable amount of time. When the app is prepared, it is uploaded to the server without the need to purchase an app store license. They are completely native experiences, light, and load fast.

PWA in the fintech industry ensures a convenient finances management because it is smooth, easy to use, and allows to add transactions fast. Progressive Web Apps are easy to install and are highly responsive. They also provide the user with fast access to finances without downloading an app. PWAs can also operate offline, which is important in case when the network connection is unstable. PWA’s significant advantage among the others is its enhanced performance and fast loading time. This type of app requires less time for development, which makes it a cost-efficient solution.

Fintech dedicated development team

Once you have chosen a fintech app concept, you will need professionals to make that happen. An internal team, outsourcing, or the usage of freelancers are all options you have. In your dedicated development team, every specialist should be aligned on the goals, process, and desired app functionalities. 

All team members must be familiar with the fundamental principles in fintech application development. Overall, you will need professionals in the following fields:

  • Designing UI
  • App Development
  • Developing Android (Java)
  • Developing iOS (Swift Language)
  • Software testing
  • DevOps Engineering 

Define the features of your fintech app

Your team should think about the functionality required to run your app in this step. We suggest beginning by including the most crucial ones in your minimal viable product. And if your app is in demand, you may add more sophisticated functions.

Create app UX/UI design

Your designers can now begin working on the financial app’s visual elements. They should first think about the navigation on your platform and perform UX research. They can only then start working on the user interface. Keep in mind that any feature required should be accessible from the dashboard, saving the user from having to conduct a time-consuming search.

Develop the application

Your developers can start working on the technical component of the process once the app design is complete. You will thus get a functional minimal viable product (MVP).

Ensure regulatory compliance

You should also consider your app’s legality. Data protection and anti-fraud laws are major topics of regulatory and legal requirements in the financial industry. Verify that your app complies with all applicable laws. Every nation has its own set of legal standards. Fintech apps are subject to a variety of privacy regulations, including GDPR, ePrivacy regulation, CCPA, and others, based on the states your app is intended for. 

Test your fintech application

Make sure a fintech app is functional and bug-free before releasing it on the market. When your QA specialists test it to address any problems, that is. It is crucial to launch a beta version of the app before releasing the full version. You can restrict access to the software to just your closest clients or staff to be able to fix any irregularities using their feedback.

Launch your app

You can offer your app to the market once it has been polished. Your team checks if users are satisfied with the product at this point and gather feedback for potential future enhancements.

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Companies are becoming more digital, providing quicker, customer-focused services. To maintain market share, industry participants are being pushed to improve their business offerings in response to increased client demands. The demand for contact-free transactions caused by the COVID-19 pandemic has considerably accelerated the usage of digital payments. It is projected that this trend toward digital payments will continue to expand and support the expansion of the sector.

Modern technology

The use of cutting-edge technologies like API, AI, and data analytics in the fintech industry is a result of the growing demand for new features that offer advanced security, flexible integration with the current financial systems, enhanced client services, transparency, and faster delivery. Such cutting-edge and trendy technology enables service customization under client and business needs. New developments have improved the organizations’ efficiency, compliance rate, and operational costs.

Security and privacy issues

Cloud computing platforms process and store the growing demand for digital financial services like payment gateways, digital wallets, and online banking. It is vulnerable to cyberattacks due to the continuous high flow of sensitive information. The most common type of cyberattack is malware. 

Financial institutions frequently use third-party fintech solutions that represent a security gap in the lack of suitable preventive actions. Customers use mobile phones to access different banking services, making them easier to hack and subject to online fraud and financial loss.

Conflicting regulatory requirements

Government and financial authorities have developed regulatory standards in response to the growing acceptance of fintech in countries worldwide. Conflicting regulations might prevent the market from growing if rules are not consistent. The cross-border versatility of financial services, which are a crucial component of today’s global environment, is hampered by the lack of common regulatory standards.

Compliance with security protocols

Fintech firms are required to obey the laws and regulations of the nations in which they conduct operations. Regarding data ownership and sharing, there are numerous technical and legal factors to take into account. A simple breach of the law today could be the end for a startup.

Fraud prevention

Secure authentication and authorization, data encryption, and routine testing with simulated attacks are required to stop account hacking, fraud, and data theft. You should find security holes as soon as possible and address them.

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Trusted fintech development partner

Innovative technologies developed in the financial sector are produced in response to current consumers’ demands. They seek fast and simple ways to manage their finances. 

The services that different fintech platforms provide are dispatched into various types. Each of them is tailored to their customers’ needs to offer the best features. Online banks with services based on various fintech solutions have become more prominent in recent years. The entire ecosystem is being improved with the development of creative and innovative financial solutions.

We hope you will find our guide to creating fintech apps helpful. If you need custom software developers to create your fintech application, our services are available to you.

ELITEX has significant experience in the financial technology niche with several top-notch products created. Our highly-skilled programmers have a background in building projects for large financial companies and fintech startups. We offer full-cycle fintech product development, from UI/UX to app development and launch. Get in touch with us to get a specific fintech solution tailored to your business needs.

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