4 Do’s and 1 Don’t That Every Startup CEO Should Know
As the CEO of an FinTech Startup it is important to know how to develop your app in the right direction. A direction that meets your goals, scales up your business and brings evident results.
A good app, just like any other software project, should never stop growing, keeping it up to date and being relevant. It should expand along with your clients’ expectations.
In this post, we will give a general overview of the current FinTech market situation and clarify what the essential aspects are to take into account when taking your FinTech mobile app to the next level. And, last but not least, mention one thing that you should avoid.
What you can learn from this article:
- The current FinTech market situation in numbers.
- What aspects to consider when taking your app to the next level.
- What shouldn’t you do if you want your FinTech app to be successful.
The FinTech market, what can you expect?
At the moment, there are more than 12,000 FinTech startups in the world, with Ant Financial, a Chinese FinTech titan, being the biggest of them: it’s worth constitutes over $60 billion and it provides over 10,000 FinTech jobs.
- According to CACI, by 2022, mobile transactions are projected to grow by 121% and will finally compose 88% of all banking transactions.
- According to Statista market forecast, digital payments, the largest segment of FinTech, are expected to constitute $4,475.40m by 2023. Personal finance will reach $160m, alternating lending $85m and alternative financing – $12m.
Your users are your compass
While statistics are super-handy, they don’t tell the whole story.
The other part of the story is known by you: your FinTech startup has finally came to life. So far you know your users pretty well, they’ve shared their reviews and real-life opinions with you and shown, what they like (or don’t like) the most about your app.
You know who your clients are: they are financially educated, tired of waiting in long queues at the bank, they loathe being restricted by the locations or working times of banks. ATM failures get on their nerves, just as much as being told what to do and when to do it. Not to mention the frustrating costs of payments.
What captivates them, however, is the simplicity, mobility and freedom to take care of their own money. The truth is: they want to be the master of their own financial fate when, where and however they want it.
You know that your product is good but without constant development it will lose its charm.
That’s why we have gathered 4 do’s and 1 important don’t to guide you to the next phase of development.
As you grow, make sure you know them all.
4 Do’s of a FinTech mobile app
“According to the research findings, FinTech companies are prime targets for cybercrime attacks with the growth of attacks outpacing transactional increase by 50 percent.” ThinkAdvisor
The more users of your mobile app, the more data under your roof to guard.
If you want the customers to love your app they need to trust you with their money. Personal cash is a fragile matter. Make sure that at each step of their customer journey your users know that they are safe in equally crucial matters, which are:
- Their personal data,
- Security of the app in case of cyber threats and attacks.
See below to learn the best practices to secure your app:
1. Make sure you comply with security protocols applicable to your FinTech app. Some of the most common are:
- NACHA (National Automated Clearing House Association, used for FinTech apps with payment processing features, read here the long-awaited report on identifying regulatory improvement on FinTech market),
- QIX (Designed for NASDAQ transactions),
- RASHport (equity protocol that enables smart order routing)
- ITCH protocol (which makes it possible to track the status of orders).
All the recommended security measures and mechanisms are listed in the ISO/IEC_27000 standard.
2. Use data encryption, especially when it comes to mobile.
There are many encryption algorithms that are used to protect sensitive data. AES (Advanced Encryption Standard) is considered to be the most secure and is recommended by USA federal government.
3. Pay attention to testing! Test your app in terms of security at each step of development, especially when adding new functionalities.
4. Use advanced user authentication methods. In 2019 password authentication is so not enough. Biometric methods like voice print, retina recognition or iris recognition are the future.
5. Hire a professional software agency to carry out the professional security audit of your app to make sure that so far everything has been done right. Especially when you need to switch from one technology to another one.
One thing is having all of the necessary measures taken care of, another one is making your customers FEEL safe.
The case is similar with e-commerce sites: all of the certificates that prove the app is safe make your customers feel more secure and prone to buy.
Make sure that your design team understands this too.
Take a look at how we did it for the Zuper app, where we used the strongest 2048-bit SSL encoding to encrypt the data. We used the same TAN security method as banks do.
“If you can’t explain it to a six year old, you don’t understand it yourself.” Albert Einstein
Have you ever read a financial statement from a corporation or a bank? Then you know what we mean. They are long and complicated. To say the least.
The simpler and more comprehensible your app will be, the better. The less clicks for the user to reach their end goal, the better.
By now you know what customers love about your app and what the most used features are. Use your analytics wisely to accentuate the great features of your app and think about modifying those that don’t fulfill its function.
Did you see how we did it for the Toucan Pay app? Toucan helps you to manage your money better. If you connect it to your bank account, it will let you know when your spending is going off track and, hey, saving never looked cooler!
Scaling up or scaling out
With new app users every day, you should decide what to do with scaling issues. Here are two of the most common approaches:
- Scaling up: achieving great results and performance in scalability of FinTech mobile or web app is a non-stoppable process requiring you to inspect the app architecture and technological stack.
- Scaling out: on the other hand, is one of the best current practices. In the cloud era, scaling out allows you to have a distributed system which will expand to the needs in peak periods, and shrink at off-peak moments.
Defining how you will scale your app for more users is one of the crucial decisions when developing it.
We could give you a hand at it, just let us know at email@example.com!
One of the buzzwords of recent years. AI (Artificial Intelligence) has been used in countless ways in virtually every sector. In FinTech, AI is a really big thing:
AI solutions are used as digital financial advisors to help customers make more financially-educated decisions. They are also used to profile the users based on their risk score. One good example is Affirm, which loans small amounts for online purchases.
With technology evolving, AI is becoming more and more approachable and budget-friendly for all market players. Not only the biggest fish in the pond.
According to Servion, AI will power 95% of all customer interactions within five to 10 years, with consumers expected to eventually prefer interaction with machines over humans.
AR (Augmented Reality) is expected to boost dramatically in upcoming years. According to Statista, in 2022 AR will surpass $209 billion, exceeding VR (Virtual Reality).
So far, the best FinTech companies are heavily investing in this technology. AR has been leveraged to help find the nearest ATMs, visualize data, help with purchases and virtual meetings.
One of the most enthralling examples is introduced by Citi: virtual trading desk – Holographic Workstation, where AR traders are able understand the huge amounts of data better.
“Someone knows your first pet, first boyfriend, favorite movie, etc. We need to get away from passwords and knowledge-based data and move to biometrics and risk-based behavioral authentication.”
Ellen Richey, Visa Inc.
Steven Cooper, Barclay’s head of personal banking, said: “Unlike a password, each person’s voice is as unique as a fingerprint.” That’s one of the reasons why SFA (Single-Factor Authentication) or password verification is so 2018. FinTech startups are on for more advanced methods of verification and in fact, voiceprint is one of the easiest types of biometric security.
Voiceprint analyzes hundreds of individual components of the user’s voice and has a huge advantage over other biometric methods, such as fingerprint ID, face recognition or iris scanning: it doesn’t require physical presence. It’s a method that can’t be breached by even the most skilled individuals.
The process is similar to the one with fingerprints: the users record themselves so that the system will have their voice sample. Once the sample is stored, the system will need just a sample of your voice to give you access to your account.
In comparison to speech recognition, it doesn’t matter what you say, it’s the sound of your voice that matters.
1 Crucial Don’t
There is just one important guideline that you shouldn’t do to the users of your app: don’t remind them of traditional banks.
Traditional banking is not-customer friendly, it’s not trustworthy and it’s largely dependent on the fees they charge. Your FinTech startup should be all about transparency, customer-friendliness and innovation.
The future of FinTech seems brighter than ever. Right now, in 2019, we are finally able to see some standardization and direction. Customers are getting more and more used to this technology.
Your FinTech app development is a never ending story of upgrading. But there’s one thing that you can do straight away. Take the first step: look at your app, can you think of one thing that you would like to improve?
If you’d like to know more about creating apps – watch our video 10 app mistakes to avoid
Need help in developing your Fintech app? Contact us at firstname.lastname@example.org