How to Develop a Fintech App: Comprehensive Guide

Various financial software has been around for quite a while, and its adoption has only accelerated after the spike of the pandemic. Since then, a growing number of financial technology solutions (short for fintech) have been continuously appearing on the market and aiding users in different verticals related to finance.

The opportunities for development in this area are quite impressive. So, we decided to overview the fintech sector, outline why early-stage startups should build a fintech app, and how to approach the matter most optimally.

Fintech Market Overview

Let's face it, not many of us still think it's reasonable to go to the bank and stand in long queues when you can use your smartphone to settle things, right? Innovative technologies have made their way to the financial sector due to the growing demand for reliable solutions that simplify everyday life. It has become one of the biggest global trends in business too.

This has given rise to plenty of fintech startups that began to emerge worldwide. Hence, financial technology is already actively transforming and modernizing many traditional systems. Here are a few curious statistics:

• According to Statista, as of 2024, more than 63% of Americans use digital banking.
• At the beginning of 2024, there were over 13,100 fintech startups in the Americas. Interestingly, more than 166 fintech unicorns are from the USA alone in 2024.
• As per Deloitte, Generative AI is predicted to be one of the main fintech trends within the next three to five years that will continue to transform financial and banking services.
• The same resource also suggests that Generative AI could also escalate banking risks like deepfakes and other threats which can result in losses of up to 40 billion USD by 2027 if not handled properly.

How about the financial side? The global investments into fintech companies have been having their ups and downs. The year 2021 saw an impressive investment rise compared to 2020, growing from 127 billion USD to over 226 billion USD. However, the investments went down in the consequent years: 197 billion USD in 2022, 118 billion USD in 2023, and 51 billion USD in the first half of 2024.

Despite the decline, financial tech still remains one of the most promising industries. The field has potential, and starting a fintech company might as well be worth it. But what kinds of fintech solutions should startups and aspiring companies go for?

Common Fintech Application Types

As you might have guessed, fintech applications have made their way to various niches, so let's overview their different types and browse some fintech SaaS ideas.

Digital Banking Solutions

Most of us are quite accustomed to using such applications. These often come in online or mobile banking formats. They allow a bank's customers to manage their accounts and make contactless transactions right from their smartphones and other devices.

With everything at a client's fingertips, digital banking omits the necessity of physically going to a bank. Which actions are at reach? You can open a free bank account, issue a payment, convert currency, transfer money, or perform actions like leaving a loan request or notifying the bank that a plastic card was lost.

Digital Payments and E-Wallets

Digital payment systems and e-wallets are the most common types of fintech apps used to simplify the process of making online payments quickly and safely. As such, you might have paid for products via ApplePay, PayPal, Klarna, or similar platforms that are often applied in e-commerce stores. Some solutions like Payoneer and the Pangea money transfer app, are supported internationally, allowing for simple cross-border transfers and transactions. They are particularly useful for sending money across borders efficiently and securely.

Digital Loan and Lending Applications

Giving more tech business ideas in the financial sector, loan solutions, such as Kabbage, are created to facilitate loans between those who give them and take them. Some are targeted at financial institutions like banks and mortgage companies, while others are adapted for regular individual users. For example, with the rise of instant approval loans, individuals in need of quick cash can find solutions through these platforms which streamline the application process, providing rapid access to funds for urgent financial needs.

Digital Investment and Trading Applications

Platforms like Hedgeable and Robinhood are designed for investment procedure simplification, empowering users with knowledge about navigating the market. This could, for instance, include guidance on exploiting lucrative brokerage promotions and deals to maximize returns, alongside educational resources and even AI-driven advisors for those seeking extra support. Many solutions also have accessible analytics, making data easy to comprehend thanks to advanced data visualization (thus, users can make better investment decisions).

Personal Finance and Budget Management

As the category name suggests, solutions like SoFi or Mint are created to assist users in managing their personal budgets and achieving their financial goals. Such consumer apps give you the chance to monitor expenses, track bills, create a plan to save money, watch over your savings, and prevent you from overspending.

Other Fintech Solution Types

Insurance applications, blockchain technology, blockchain servers, and solutions for regulatory purposes are also commonly attributed to fintech.

• Regulatory apps like PassFort are created to tackle legal and compliance issues, dial down human errors, and detect risks or fraud.

• Insuretech platforms, such as BIMA, are a way to digitalize the work of insurance companies. For instance, they help process claims faster and more effectively and allow users to see their policies.
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• Mortgage apps also deal with finances. For example, if you are in the early stages of home-buying and figuring out your budget, you can use a mortgage affordability checker to get a better idea of how much you can realistically spend. If you're still unsure, some financial institutions have guides, offer free consultations, and get you pre-qualified without having to physically go to a bank.

• Finally, blockchain technology is also gaining traction and receiving broad adoption. Various cryptocurrency-related solutions like crypto wallets and crypto exchanges, for instance, Coinbase, which has 8.8 million user base, are often forecasted as fintech's not-so-far future. Innovative blockchain platforms like Molecula are already shaping this future by combining rigorous safety audits, mathematically sound strategies, and the trust of top DeFi protocols. The future of blockchain is not just on the horizon—it’s happening now.

Reasons to Develop a Fintech App

Before we proceed to the question of how to create a fintech app, let's figure out why you should consider building one in the first place.

1. Fintech app development is at the head of the digitalization movement. More and more traditional financial institutions like banks create applications to serve the clients' needs and live up to their expectations. A growing number of customers prefer to take advantage of performing actions on the go using their smartphones instead of queueing in a bank. Hence, keeping up with the constant changes and the fast development pace is the only option to succeed as a business providing financial services. 

2. Such transformation also allows for automating and speeding up many operations that usually take a long time if handled manually. For instance, users can save time by making instant transfers from mobile devices regardless of their location, the time of day, or week. 

3. This, in turn, reduces the employee workload, streamlining various processes. Not to mention that such modernization improves customer service, boosting client satisfaction and loyalty.

4. Plus, digital fintech gives the opportunity to introduce new services that may lead to an additional monetary turn. A growing number of users take an interest in trading, blockchain technology, and other ways to invest their money, so they seek convenient and trustworthy solutions.

Because all of this is becoming a "must" rather than a trend, many organizations invest in fintech application development for their customers or improve the solution's usability, accessibility, and security. They often turn to experienced third-party development teams to accomplish that or consider purchasing ready-made solutions or SaaS for integration.

In any event, fintech applications have a wide variety of use cases. And, as we've shortly mentioned before, this sector is receiving investment and has an auspicious future.

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Which Challenges Can You Face?

If you've decided to develop a fintech product, we have to give you a heads-up. There are possible obstacles that you'll need to overcome.

1. You should first and foremost be thinking about how to make a fintech app that'll be safe to use. You'll be responsible for keeping sensitive customer data, and data breach is an especially touchy subject that can lead to drastic consequences. Do everything possible to guard your solution from various types of attacks and fraudulent activity, continuously check it for vulnerability, and protect it from data leaks, personal data theft, and other cybercrimes. Hence cybersecurity can be among the most difficult problems to solve.

2. Moreover, many legal regulations have to be taken into consideration when you build a fintech app. Depending on the type of solution, you'll need to keep an eye on legal compliance and all the ensuing peculiarities, especially if you're going on an international scale.

3. Thirdly, as you might expect, fintech is a rather competitive market with many big names already offering their solutions. Since money is at stake, getting people to trust you and your brand may also be a challenge.

Fintech App Features and Tech Stack

There are numerous ways to approach fintech application development, as no two solutions are the same. There will, of course, be differences in functionality based on the type of app, its aims, and the problems it solves. This why the MVP development cost for a fintech product will also heavily depend on app complexity. But let's go over some of the most common features and often chosen tech stack.

Standard Fintech Application Feature Set

Generally, fintech apps have most of the features we list below.

• Log in or sign up (in most cases, modern fintech solutions use two-factor authentication or biometric solutions like face or fingerprint scanning for safety reasons);
• A user dashboard (ideally, an intuitive screen layout with all the necessary actions a user can take);
• Standard operations and a payment gateway (this is the functionality allowing users to perform actions in the application like making online payments, money transfers, etc.);
• Action confirmation (with this functionality a user can confirm an action like issuing a payment by entering a PIN, typing or graphically drawing a password, or via biometric confirmation);
• Automated repetitive action features (allow users to automatically issue routine payments instead of doing so manually every time);
• Push notifications (send reminders to notify a user about vital information, updates, or occurring changes);
• QR code and card scanning (gives users the opportunity to scan QR codes or plastic cards to facilitate completing specific actions);
• Digital assistants (sometimes teams decide to build AI chatbots or add such functionality to the application so an AI assistant or real customer service staff could quickly reply to user inquiries);
• Customization opportunities (personalization makes it easy for users to modify the layout, theme, or settings according to ther preferences);
• Security features (data safety in the fintech sector has utmost importance, therefore, various cybersecurity features are implemented to prevent hacks, unauthorized actions, data theft, and leaks).

Possible Tech Stack for Fintech App Development

As regards the technology stack, you have to understand that the options will differ based on the type of fintech solution you want to create and what it's going to be in terms of the developed end product.

For instance, even if you decide to prioritize mobile users, there are different types of mobile apps that you can build (a native application, a hybrid solution, a web app, a progressive web application, etc.). If you're planning to make the solution usable from other device types (say, smartwatches), then you'll need additional development effort for IoT adaptation.

As you see, there may be various paths to follow. You'll most likely need to combine various technologies to build a fintech app that'll achieve your goals. Below we list the commonly chosen options:

• Server: AWS, Google Cloud
• Programming languages: JavaScript, Python, TypeScript, C++, Java, Golang, Ruby
• Web development frameworks: Angular, React, Vue
• Mobile development frameworks: Ionic, React Native, Flutter, Swift, Kotlin, NativeScript
• Database: MySQL, MongoDB, PostgreSQL
• API: Apex, Twilio API
• Payment gateway: Stripe, PayPal, Braintree

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5 Steps to Create a Fintech App

So, how do you start building a fintech app? Let's go over the process step by step.

Step 1: Define What You're Going to Create

First things first, decide on the fintech category of your future product. Is it going to be a trading app, a banking solution, or something else? Who are your potential clients (companies, individual users, or both)?

At this point, you need to figure out what is your main focus, including the target audience and its needs. Try to find answers to questions like:

• why did you choose this niche;
• why what you have in mind is relevant;
• how will the product effectively solve user problems.

You should also think about how you'll bring the chosen fintech solution to life. That is, whether you'll be building a native mobile application, a hybrid solution, etc. These are all vital parts of the idea initiation stage that can take you one step closer to finding product-market fit.

Step 2: Competitor and Market Analysis

Now, it's time to do research and prove that your assumptions are worthwhile and the idea stands a chance. So, proof of concept (POC) is the next thing to work on when creating the concept. It will help you ensure that the app is worth creating, let you get prepared, and become more organized.

Conduct market research to get a better understanding of the market's current state and saturation. Also, browse the competitors and the existing solutions already out there, noting their strengths and the points you can implement better. Keep an eye on how your hypothetical competitors monetize their fintech apps. Do they charge transaction fees, use subscriptions, or opt for other paths?

Step 3: Compliance Research

Studying the legal aspects is among the most scrupulous tasks. You have to build a fintech app that won't have any compliance or regulatory issues. This means that you must bear in mind the laws and restrictions that apply to the fintech sector and be aware of the possible differences if you target several countries. 

Step 4: Planning the Technical and UX/UI Sides

Deciding on a feature set isn't easy, as you most likely won't be putting the entire scope in production from day one. It makes sense to invite developers, designers, and other domain experts to brainstorming sessions and the discovery phase. This way, you'll get more opinions on how to proceed with your fintech app development most optimally.

As such, you can:

• decide on the tech stack and how to cut corners (for instance, when choosing between using custom or off-the-shelf software);
• work on feature prioritization and shortlist the top functionality that'll be present in the minimum viable product and consequent releases;
• create technical requirements, a development timeline, and plan.

Most importantly, since fintech apps hold even more responsibility for keeping sensitive data than other application types, you'll have to think through the security aspects in detail to safeguard the solution from data loss.

The UX/UI designers can, in turn, shed light on how to make the application intuitive and appealing for the users. At this stage, they create wireframes and prototypes that you can click through and test to iron out the "wrinkles" before the full product or MVP design is passed on for further development.

Step 5: Decide on the Monetization of Fintech Apps

If you're looking to cash in on your fintech app, there are some ways to make money while offering valuable services. Here are a few popular fintech app monetization options:

• Subscription model — Consider offering a free trial to attract users, and once that period is up, they can choose to continue for a fee. Subscriptions typically come with a fixed price, either monthly or annually, giving users access to your app or premium features. As your user base grows, you'll start to see a reliable stream of income coming in.

• Financial transaction fees — If your app allows users to send money or manage virtual cards, why not implement a small fee for each transfer? This approach can be highly profitable, as fintech apps frequently handle currency exchanges and payments for third-party services, which can let you tap into a consistent revenue stream while providing essential financial services.
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• ‍Advertising — If you're looking for a steady source of income, ads can be a great option. While users might not always be fans of advertisements, banners and short videos are widely used. To keep the experience pleasant, try placing ads in less intrusive spots within the app. Either way, advertisers will pay for impressions or clicks, making it a dependable way to boost your revenue.

Step 6: Create the MVP and Launch It

Once the detailed plan is lined out and the designs are ready, you can move on to MVP development. After the product is brushed up and has gone through thorough QA testing.

When you're sure that the solution is free from glitches and bugs, continue with MVP launch to get your first users and their feedback. Then analyze your findings. Notably, you won't only handle support and maintenance after the release and may move on to building other features, further app expansion, and improvement.

Build a Fintech App with Upsilon

Upsilon has extensive and considerable experience in providing mobile app development services, including in the fintech sector. We've helped aspiring startups and established enterprises create fintech solutions, and we'll be glad to provide you with a consultation and our assistance.

It's very tough to give an estimate of how much a fintech app will cost, given that they may drastically differ in development complexity. Yet we'll gladly make a project cost estimation if you share your project ideas with us!

We know how to build a fintech app that users will love. So, if you don't have a team of your own or are searching for a fintech app development company to help you bring your vision to life, Upsilon can assemble a dedicated software development team from our expert talent pool to work on your project.

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Final Thoughts on Building a Fintech App

Creating a fintech app is by all means tough. The sector is highly regulated legally and puts security before everything else. But if you decide to move in the fintech direction and incorporate modern solutions to build something truly worthwhile, all the hard effort can be rewarding. Partnering with reputable fintech app development companies can offer many directions to move in and provide unrivaled opportunities for startups.

If you're still not sure how to develop a fintech app optimally, you're more than welcome to contact us. We offer various fintech application development services and would be happy to help you create the solution you have in mind, regardless of development complexity. We use sprint-based dedicated team pricing and have a flexible team of experienced specialists.

FAQ

1. What is a fintech application?

A fintech application is a mobile or web-based platform designed to provide financial services through technology. Mobile application development for fintech focuses on creating user-friendly apps that allow users to manage finances on the go. Fintech web development ensures seamless access to these services from any device, offering features like online banking, payments, or investments.

2. Is it hard to find fintech application developers?

Finding fintech application developers can be quite complex due to the specialized skills required for fintech app design and development. Developers need expertise in both finance and technology to create secure, user-friendly solutions. Custom fintech app development also demands knowledge of regulations, security protocols, and tailored features, putting experienced developers in high demand.

3. How much does it cost to build a fintech app?

A fintech development app estimate typically considers the complexity of the features, design, and level of customization required. On average, the cost to develop a fintech app can range from $30,000 to $300,000 USD or more. Therefore, the final cost of fintech application development totally depends on the project’s scale and specific requirements.