You may think you have no idea what Financial Technology (FinTech) is or probably think its a complex sector that you are not a part of as an individual.
You are wrong! FinTech is a way of life now and serves on a day to day basis. If you are using Google pay to pay your electricity bills, PhonePe or various other UPI payments – you are using a FinTech tool. FinTech is all around us and has made a pivotal change in the way we transact money.
Start-ups have disrupted the old school brick and mortar banking ways and have introduced a whole new avenue for financial services for businesses and individuals.
- What Is A Fintech Software?
- Types Of Fintech Software
- Chatbots and virtual assistants
- Artificial intelligence for predictive analytics
- Digital-only banking
- Internet of things (IoT)
- Augmented reality
- Peer-to-peer (P2P) transaction technologies
- Software For Different Functions Of Fintech Solutions
- Loan origination software
- Commercial loan software
- Online banking software
- Mobile banking software
- Insurance CRM software
- Personal finance
- Financial Risk Management Systems
- Benefits Of Outsourcing Your Fintech Software Development
- Latest Technology
- Personalization and Customization
- Enhanced Security
- Online banking software
What Is A Fintech Software?
The term FinTech is born from combining finance with technology – financial technology. It is used to define any kind of technology for the financial sector. The term describes any company that provides financial services through various software and technology.
A company that uses the internet, mobile devices, cloud services and software technology to connect businesses or a consumer falls under the FinTech umbrella.
FinTech has made inroads with several applications and made financial management more accessible for consumers. From mobile payment apps like Google Pay, Phone Pe to credit apps like Lazy Pay and Simpl. Consumers now have the opportunity to make transactions at the tip of their fingers and manage their finances the same way.
FinTech tools provide nimble options for consumers to participate in financial services without the need for the brick-and-mortar to give consumers direct access to their financial lives through easy-to-use technology.
Types Of Fintech Software
#1 Chatbots and virtual assistants: Banks and other payment gateways get several queries as not everyone is technologically savvy. More often than not, many of these queries are similar.
Most financial platforms have FAQs and Support Articles – but these generally tend to be lengthy and confusing for some and they would rather have active guidance for a problem they are facing.
In the past, human advisors helped consumers understand their options. However, since most customers have a similar question with slight variations chatbots can be used to address their concern immediately.
This is also beneficial for the service provider as they solve for their distressed customers on urgent bases and give them a possible answer or solution to their concern. This in turn – creating a better user experience.
#2 Artificial intelligence for predictive analytics: AI technology today empowers businesses to leverage data to create consumer specific solutions that are personalised.
AI not only enables predictive analysis for personalised experiences, but it also powers chatbots and virtual assistants that are prompt.
Banks and companies in the financial sector now have the power to make data-driven decisions and create real-time solutions.
#3 Digital-only banking: Not so long ago, consumers depended and had more confidence in transitional physical financial institutions.
However, with the fast-paced technological advancements and change in consumer behaviour – banks now have to maintain some form of digital presence via websites and mobile apps.
The wave of cutting edge technology has given birth to a new generation and way of banking. Banks are now going fully digital – Digital-only banks.
Digital banks offer the same conventional deals to consumers but at the tip of their fingers.
#4 Internet of things (IoT): IoT allows several devices to get connected to the internet – it opens up immense opportunities for the financial sector.
For example, companies can deploy IoT devices to collect insurance telematics and use the information to provide customized insurance coverage. In case of an accident, IoT devices can provide more accurate information to make faster claim decisions.
#5 Augmented reality: Augmented reality (AR) is helping fintech institutions enhance and enrich services for consumers.
AR technology through mobile devices allows consumers to interact with the bank in an augmented reality environment.
For example Wells Fargo has created an AR-based system that allows consumers to interact with bank tellers in an augmented reality environment.
AR allows consumers to feel more connected to the institution and have a better experience with their services as it combines the digital and physical world.
#6 Peer-to-peer (P2P) transaction technologies: Google Pay, Phone Pe, Zeta and so on are now a major part of our daily lives. With more consumers using P2P technologies, the market share for this sector is on a rise.
With the ease of access, it becomes easy for all vendors and local businesses to adopt PRP payment technologies for daily transactions.
A big benefit of P2P payment methods is that they remove the middlemen and bring down transaction costs.
Software For Different Functions Of Fintech Solutions
#1 Loan origination software: FinTech lending softwares like loan origination software enable financial lending organisations to provide rapid services and handle diverse channels for multiple market segments while providing a high-quality user experience and smooth interactions between borrowers, partners, and lenders.
#2 Commercial loan software: Commercial loan software helps to optimize and automate the lending process. Companies can get insight into risks with deep analysis of data, track and control delinquent accounts by means of constant follow-ups and history logs.
#3 Banking: Banks going digital have huge benefits from cutting edge FinTech. Digital Banks allow their customers to handle the majority of banking operations online – making ease of access seamless.
#4 Online banking software: Online banking software gives customers the freedom to manage all aspects of their accounts over the internet rather than by visiting a traditional bank. Online banking software allows customers to manage accounts, view transaction history, pay bills, and more.
#5 Mobile banking software: Mobile banking allows users to make real-time transactions, transfers, pay bills and track finances.
Mobile banking services are available 24/7 from anywhere, automated software minimizes human error and allows customers to chat or call at any time for help and feedback when they need personal assistance with financial services.
#6 Insurance CRM software: CRM software tools are great to streamline work processes. Agents in the FinTech sector often have to manage a lot of documents and paperwork.
Insurance CRM software provides agents with a customer information system and allows them to generate documents, assign tasks and track progress more easily.
Furthermore, a CRM software will make task management more efficient – data entry can be automated, data can be managed on a single platform and agents managers can track agent progress.
#7 Investment: Investment management software provides users with investment management analytics. Apps like Kite by Zerodha and Groww help users track and manage their portfolio in one place.
The user has all required data and analytics accessible on a single platform – making investing more easy.
#8 Personal finance: Personal finance solutions help people track how they spend their money and plan to use money better.
Apps like Splitwise or YONO by SBI generate reports on monthly spending and show an overview on when the most money was spent.
#9 Financial Risk Management Systems: Such systems manage risk by detecting potential risks beforehand, analyzing them and taking the necessary precautions to minimize or reduce these risks.
They use real-time data to keep a check on risk-exposure and save the risk on a database to be assessed. The system also generates analytics via charts and reports that companies can use to track and analyze compliance progress.
Benefits Of Outsourcing Your Fintech Software Development
Technological advancements for your business can be a wrong form of investment, it just boils down to how you make the investment for the development of the required software.
You have to evaluate how the software is meant to positively impact your business and ask yourself what tasks you are aiming to optimise. For example, a bank that has only a physical infrastructure may be unreachable for many of its customers – in this case setting up a mobile app with interactive chatbots and customer support will make your services more accessible.
Once you have brainstormed why you need the software – you have to ask yourself if you have inhouse resources who can build it efficiently for you.
You have to keep in mind, your in house tech team will have the core of the business to focus on and outsourcing software may turn out to be more beneficial for you.
Here are a few reasons why you should consider outsourcing your software development:
#1 Latest Technology: There are now various new technologies like blockchain, data analytics and cloud computing that can drive your FinTech services to new levels of growth.
New technology means you will need new talent to leverage the tech for your services. However – hiring new talent and finding the right talent to do this can be time consuming. By outsourcing your software development to a third party firm – you save yourself the time the money of recruiting and training and also get industry experts to build your software.
#2 Personalization and Customization: Every customer wants to feel special and feel like they are getting value for their money. If you understand what your customers’ needs and wants are and solve directly for them – they will be more satisfied and remain loyal.
Using custom fintech software – you can leverage data analytics to get insights into consumer data and use that data to make tailored customer experiences.
You can create personalised apps, online banking services and loyalty programmes to enhance your customer experience.
#3 Enhanced Security: Banks and other financial institutes naturally have a record of sensitive data like your salary, spending habits, aadhar card and PAN number etc.
Cyber-criminals have become extensively savvy and sophisticated at breaching data. Banks now have to ramp up their security and data privacy defences.
AI technologies can be used to identify and minimize fraudulent online activities and biometric technology to help make your financial software products stay virtually hack proof.
#4 Improved Efficiency: Customised fintech software can solve problems in several domains for you.
- AI-assisted chatbot: Chatbots can be used to handle customer inquiries quickly and accurately, even outside regular business hours, giving them on-demand service.
- Cloud computing: Cloud computing reduces infrastructure expenses and makes opertatios more streamlined and efficient.
- A Team: Developers who build your custom software are well versed with design thinking, quality assurance and data privacy features.You won’t need to spend time addressing those issues after the product is completed.
#5 Scalability: Custom software can be designed and built for the longer vs off the rack software that may not stay updated with changing trends.
Custom software allows your company to be like a balloon – as your grow the material expands to accommodate the growth – your software has to be able to grow with you.
Furthermore, custom software lets you stay ahead of your competition as new features can easily be developed and added based on requirements.
The world is undergoing technological changes on a daily basis with new trends on the rise. The FinTech sector needs to jump in and leverage softwares to make their services more efficient and optimised for the tech savvy customer.
If you are looking to outsource your fintech software development – you can get in touch with us for fintech software development services. We have a team of experts who will build you exactly what you need to improve fintech services.