The revenue of the FinTech market has been steadily growing, making it an attractive space for entrepreneurs seeking lucrative opportunities. According to Deloitte, global FinTech industry revenue has nearly doubled since 2017 and can reach $197.8 billion in 2024.
As the FinTech market grows, so does the competition, driven by the emergence of startups and cutting-edge technology, creating a dynamic landscape full of opportunities and challenges.
In this article, we present the top financial software development tips to build a reliable payment solution that will help you outpace your competitors in this race.
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The growing FinTech market
According to Statista, the digital payment market is significantly growing and expected to reach 5.48bn users by 2027.
The shift towards digital platforms has significantly influenced the market size as users embrace digital solutions such as apps and mobile banking for their financial tasks. According to research, 75% of consumers have used a FinTech money transfer or payments service.
However, the growth of the financial market is like a two-sided coin. It opens up new opportunities for its players, but it also creates additional obstacles such as strong competition.
That’s why we highlight the top expert tips for financial software development that can help you accelerate your product launch and conquer the FinTech market faster than your competitors.
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7 expert tips for successful financial software development
Financial software development differs from software development for other domains in its complexity and increased attention to security and regulatory compliance. Below we highlight the most essential tips on building a powerful financial system.
1. Focus on product design and architecture
In the FinTech world, the architecture of a software system is its backbone, a critical foundation that can make the difference between success and failure.
As SDK.financeCTO Pavlo Sidelov recently pointed out, “To succeed in this dynamic industry, FinTech companies must recognize the importance of robust design and architecture as essential components of their success”.
Pavlo’s insights highlight the fact that most FinTech products have about 90% of their components in common. This is where software providers come in. The SDK.finance solution accelerates financial software development by offering a pre-developed FinTech Platform that serves as a scalable foundation for payment product development.
By using a powerful software foundation, financial products can be developed faster with a focus on delivering intuitive user experiences that are critical to competing in today’s marketplace.
2. Legacy code as a springboard
Successful financial software development involves dealing effectively with legacy code. Legacy code, while often seen as a challenge, can also be an advantage if handled strategically.
Rather than viewing it as an obstacle, view it as an opportunity for incremental modernization. Prioritize understanding and documenting legacy code, which can provide valuable insight and justification for previous design decisions.
This approach minimizes risk, reduces the potential for disruption, and maximizes the value of existing investments. By strategically addressing legacy code, you can gradually transform your financial software into a more flexible, efficient, and secure system while maintaining system continuity and stability.
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3. Deep understanding of domain specifics
The financial domain in software development has specific requirements due to the sensitivity of financial data, compliance with regulations, and the need for high security and reliability.
For example, the product must adhere to regulations:
- GDPR (General Data Protection Regulation). Safeguarding user data and privacy is paramount. GDPR compliance is essential to protect sensitive personal information and maintain customer trust.
- PCI DSS (Payment Card Industry Data Security Standard). The handling of payment card data necessitates stringent security measures. Compliance with PCI DSS is a fundamental requirement for FinTech payment solutions.
- KYC (Know Your Customer). FinTech products must establish robust KYC procedures to verify the identities of their users. This measure helps prevent fraudulent activities and ensures compliance with anti-fraud regulations.
- AML (Anti-Money Laundering). AML regulations are vital for detecting and preventing money laundering activities.
Financial software development should also include robust security measures to guard against common security threats, including:
- SQL Injection: SQL injection attacks can compromise the integrity of databases and user data. Robust security measures should be in place to thwart such attacks.
- Cross-Site Scripting (XSS): XSS vulnerabilities can lead to unauthorized code execution in a user’s browser, posing severe security risks. FinTech products must have safeguards against XSS attacks.
- Cross-Site Request Forgery (CSRF): CSRF attacks can trick users into unwanted actions without their consent. Implementing protections against CSRF is crucial to maintain product integrity and security.
By distinctly separating regulatory compliance and security measures, FinTech products can ensure they meet essential industry standards while safeguarding their users and data from potential security threats.
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4. Cutting-edge technologies
Finance requires a specialized tech stack for software development due to its demanding scalability and data security requirements. For example, programming languages such as Java, C# and Python are known for their reliability and security and are widely used in the financial sector.
Payments software often needs to integrate with various external systems such as currency exchange, payment gateways, and regulators.
The stack includes tools for seamless API integration. The SDK.finance FinTech Platform provides more than 400 API endpoints that allow you to connect to a wide range of payment providers and other services and process transactions quickly and cost-effectively. Here you can get more details about our technical stack for payment software.
5. Continuous integration and delivery
The practice of CI/CD in software development automates the process of building, testing, and deploying code. This approach enhances code quality, boosts developer efficiency, and reduces costs. The core concept is to establish and maintain a central, reliable source of truth. This ensures that developers are always working on an integrated system.
Source: TIBCO Software
Martin Fowler,a British software developer, author and international public speaker on software development, said, “ Many teams find that this approach leads to significantly reduced integration problems and allows teams to develop cohesive software more rapidly.” Within CI/CD, software testing and error detection play an important role. It also ensures a controlled and consistent delivery process.
6. Data-driven approach
Data-driven software development is based on Key Performance Indicators (KPIs) like performance metrics (response time) and quality metrics (defect rate, delivery rate and Net Promoter Score for customer satisfaction).
These clear, objective, and unambiguous metrics encourage development teams to think about the long-term strategic goals of their daily work and the business value of each project.
“Data-driven software development, as endorsed by Brett King, a co-founder of FinTech company Moven, leverages real-time insights into customer behavior, employing Big Data, mobility, and gamification principles.”
FinTech thrives on data, and the opportunity lies in leveraging data-driven insights to develop innovative financial products.
Use data analytics, machine learning, and AI to develop solutions that not only process transactions, but also provide predictive and personalized financial services.
7. Using a pre-developed solution to speed up the development process
Financial software development is a challenging process that requires significant time and human effort. Depending on the complexity of the product, it can take anywhere from several months to several years to develop a release-ready product.
Іnstead of building the basic functionality from scratch, you can use a pre-developed software to accelerate the development process. Unnecessary modesty aside, SDK.finance happens to be of the vendors providing pre-developed customizable FinTech backend software. With this solution in place, your development team can concentrate on building the customer experience features that will set your FinTech product apart.
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These strategies encompass various aspects, from architecture and legacy code management to domain-specific knowledge and a data-driven approach. By understanding and applying these principles, financial software not only can meet regulatory requirements but also provide innovative solutions for the ever-evolving financial landscape.
Choosing the financial software development partner
The choice of a FinTech software provider can significantly impact the success and efficiency of your payment product. It’s essential to consider factors such as an experience in the financial industry, a track record of delivering secure and compliant solutions, expertise in specific technologies, and the ability to align with your business goals.
The pre-developed Platform by SDK.finance serves as a powerful foundation for building digital wallets, money transfer systems, business ledgers, neobanks and other FinTech products faster, without starting from scratch. Using our ready-made Platform and cooperating with our dedicated team with over 10 years of experience in FinTech provides you a complex solution for building your PayTech product faster and more efficiently.
The shift to digital platforms has significantly impacted the size of the financial market and provides opportunities for the development of new payment solutions.
By following the strategies outlined in this article, you can navigate this dynamic landscape, comply with the regulatory requirements, and provide innovative solutions to meet financial needs of consumers.
What is financial software development?
Financial software development refers to the creation of software applications and systems tailored to meet the specific needs of the financial industry.
It includes the development of solutions for banking, payment processing, investment management, and various other financial services.
What are the key challenges in financial software development?
Key challenges in financial software development
include ensuring data security, complying with regulatory requirements, dealing with outdated code, and developing solutions that can scale effectively to meet a growing user base.
How can I choose the right financial software development partner?
When choosing the right partner, look for a company that has expertise in the financial industry, a strong track record of delivering secure solutions, knowledge of specific technologies, and a commitment to meeting your business goals.
SDK.finance is a FinTech software provider that offers a scalable payment Platform for building various financial products.
What are the essential tips for successful financial software development?
Successful financial software development involves focusing on product design and architecture, strategically dealing with legacy code, leveraging domain-specific knowledge, taking a data-driven approach, and considering pre-developed solutions to accelerate development.