Over the past decade, the banking and financial sectors have changed more than ever before. That also applies to fintech software vendors. The shift in IT technologies changed the approach for developing financial software. This is a sector that requires the highest level of competence, responsibility, and a well-round mind of each team member.
That`s why choosing a fintech development partner can be a daunting task.
Why Fintech Is a Special Sector?
There are at least two reasons that galvanize many companies to hire fintech-oriented partners rather than saving a buck and sticking with a regular software developer.
There are at least two reasons that galvanize many companies to hire fintech-oriented partners rather than saving a buck and sticking with a regular software developer. #Fintech #Finance Click To Tweet
- Cyber Risks
Neglect in cybersecurity can ruin the entire economy of any FinTech company. This is because more systems are involved in the development stage and cybercriminals are potentially exploiting more vulnerabilities.
A good example is the report of the bank robbery where hackers successfully exploited a vulnerability in security.
Anyone who has anything to do with information security knows that the more systems are connected, the more vulnerable they are. That’s why each FinTech environment has its sovereignty here, even if some self-regulation rules are followed.
It’s therefore critical to hire a capable risk manager and IT security team, especially when it comes to complex attack vectors.
- Specialized Team for Fintech Sector
Those who develop chatbots in the banking sector may also work on similar retail projects.
However, the fintech sector requires a whole lot of specialists with a whole lot of experience. That`s why companies with a sole focus on fintech software development put a lot of effort into their resources.
They expand their security team, test the site and application for vulnerabilities every month, and create useful content to educate employees about financial and IT literacy. A company’s trustworthiness depends on how well the employee understands the finance sector.
The more competent developers are the more tools they use to improve software credibility. That’s why most major fintech market players invest resources in educating their audience.
These 2 factors can turn your search for a fintech development company into hell. How do you choose then?
- Setting Up a Team for Fintech Project
Developers with entrepreneurial, financial, technical, and legal skills are a fundamental requirement for a credible software company.
The mindset, structure, communication, and skills of the development team should be superb. Project managers and executives must understand the complexity of building a full team of specialists: from UX designers to the legal department.
A good developer should be able to:
Work with mobile app security, third-party integration, cloud solutions, thoroughly know the PSD2 and GDPR directives, have the technical and legal muscle to ensure complete privacy, as well as being able to work with modern technologies stack that we`ll cover below.
Fintech Software Development: Technology Stack
Today you can’t rely on CMS and other third-party frameworks to manage transactions in the financial sector.
Technologies such as machine learning, artificial intelligence, tools for data collection and analysis, biometric identities are at the heart of any developer in the fintech sector.
The most widespread technology stack for fintech and finance sectors includes:
Does Your Vendor Understand the Regulatory Environment?
The fintech industry is arguably the most regulated in the world. In addition to existing regulations for credits, insurance, and financial crime, companies must also consider consumer data protection laws such as the GDPR or GPDR.
Fintech companies often use subcontractors.
However, a subcontractor should meet certain legal and regulatory requirements. These requirements should meet the aforementioned regulatory and legal obligations and be recorded in the contract.
In addition, contractual agreements with subcontractors should be reviewed before investment to determine if the quality of service, scalability, duration, liability goes hand in hand with your business model.
Clear Terms of Reference
When determining the exact cost and time of development, it is better to first create a detailed term of reference. It can include the number of hours required for all the stages of work and the total cost.
A typical TOR may include the following:
- Detailed technical specifications of the product or service.
- Rates, people who will manage the project, responsibilities, schedule, background.
- Criteria for selecting or eliminating vendors.
- Key dates. For example dates for calls/visits, demonstrations, meetings.
- Confidentiality requirements.
- The contract model by which the contract will be awarded.
The fintech sector encompasses a huge number of areas: payment services, investments, insurance, various types of loans, and non-banking.
This entails great responsibility in such areas as cybersecurity, the financial and technical prowess of developers, and regulatory issues.
Therefore, you should be looking for those software development companies with a proven record in the fintech area.
Louis Sawyer is a professional writer, editor and a web design expert. She loves writing about technology trends, web development, mobile games and business issues. Also, Louis works as a proofreader at Computools. Follow Louis on Twitter.