The future of finance is here, and it's called FinTech.
Almost 80% of incumbent financial organizations have already entered the FinTech world, and global FinTech application downloads reached 3.2 billion in 2020.
At CSHARK, we have a deep knowledge of the industry. Since 2014, we've cooperated with various financial institutions at all stages. In cooperation with Fenergo – an Irish unicorn – we develop cutting-edge technology for some of the world's top banks.
In this blog article, we'll explore the 6 main advantages of using FinTech applications in finance, namely:
Whether you're part of a startup or enterprise, you can benefit from fintech applications, which offer a range of features to enhance financial operations. These apps streamline processes like fraud detection and compliance management.
As a result, your business can better serve customers in areas such as online banking or investing.
As we just mentioned, Fintech applications can offer several benefits. We discuss them below in more detail.
And remeber, before you embark on the journey of creating your application, it's crucial to partner with the right software development company.
Read more: What to Look For When Selecting a FinTech Software Company?
FinTech applications have the potential to significantly increase efficiency in the financial industry.
By automating many processes and reducing the need for manual labor, FinTech makes transactions faster and more accurate.
Firstly, the software streamlines processes such as payments and money transfers, by providing digital platforms facilitating instant and seamless transactions. It automates repetitive tasks such as account opening, loan application processing, and compliance checks, which reduces errors and saves time for both the financial institution and its customers. By automating these routine tasks, fintech apps help companies reduce their operational costs, which in turn can lead to increased profitability.
Secondly, FinTech companies increasingly rely on using Artificial Intelligence (AI) and Machine Learning (ML) to analyze financial data. These tools provide insights that support financial institutions in making better decisions and improving their overall performance.
Let’s not forget about blockchain technology, which can increase efficiency by allowing for faster and more secure transactions. This likewise saves time and money for both the company and its customers.
Read more: AI and Web 3.0 Will Not Yet Determine the Power of FinTech
FinTech tools have the potential to lower costs in several ways.
Digitalization of financial services lowers the costs for financial institutions as well as for customers by reducing the paperwork, printing, mailing, and other physical-related costs.
FinTech companies tend to have lower overhead costs than traditional financial companies. They often don't need to maintain physical branches, which can be costly to operate.
By using data and algorithms to personalize the experience for the user, FinTech software lowers costs by providing customers with products and services that are tailored to their specific needs and goals.
Using advanced technologies (such as encryption and biometric authentication) to protect users' data and designing the applications with security in mind improves the safety of transactions.
Below, we list some ways in which FinTech apps are designed to be secure.
Encryption is used to protect users' personal and financial information and transactions. This makes it difficult for hackers to access or steal sensitive information.
Many FinTech apps employ biometric authentication such as fingerprint or facial recognition to confirm the identity of the user. In this way, unauthorized users can’t easily access the app.
Most FinTch applications use two-factor authentication, requiring users to confirm their identity using a second method, such as a text message or email. This adds another layer of security.
Fintech companies use secure servers to store users' information and transactions. It offers protection against data breaches and unauthorized access.
FinTech companies need to comply with regulations such as KYC (Know Your Customer) and AML (Anti-Money Laundering) – it prevents illegal activities such as fraud, money laundering, or terrorist financing.
Read more: What's the True Price of Non-Compliance?
Releasing regular security updates to the apps fixes any vulnerabilities that may be discovered.
FinTech applications allow customers to access financial services from anywhere, at any time, using their mobile devices – making it easy for customers to manage their financial transactions and information on the go.
Mobile banking apps offer a range of financial services for their users, such as payments, investments, and insurance – all in one place – providing users with a one-stop shop for all their financial needs. This has significantly reduced the need to visit physical branches.
According to the study by Accenture, as much as 72% of consumers prefer using digital channels for banking transactions.
Want to develop a FinTech app with a partner that understands the financial landspace? See what we can do.
Personalization equips customers with financial services tailored to their individual needs, helping them better manage their finances and make more informed decisions.
How exactly can financial applications be personalized?
Using data and algorithms to personalize the experience & providing personalized financial advice to users based on their individual needs and goals.
Offering customized investment options, such as portfolios tailored to a user's risk tolerance and investment goals.
Presenting budgeting tools that can be adjusted to a user's individual expenses and income, helping them to better manage their money.
Sending personalized notifications, for example, reminding customers of upcoming bill payments or alerting them of unusual account activity.
Using data and algorithms to personalize offers and discounts to users, based on their spending habits and preferences.
Benefiting from predictive analytics to anticipate the needs and wants of the customer and offer personalized recommendations, for example, credit cards, loans, and insurance.
FinTech generally increases financial inclusion, making financial services more accessible to people who were previously underserved by traditional financial institutions. It's particulary relevant in the case of individuals from rural areas or low-income households, those in developing countries, and those with poor credit.
Many FinTech apps are available in multiple languages, which can help to increase accessibility for non-native speakers and individuals who have limited proficiency in the official language.
FinTech applications also enable customers to digitally sign and submit documents (e-signature and e-documentation), which further reduces the need for physical visits and increases accessibility.
At CSHARK, we have over 9 years of experience in various FinTech projects. We can help your next endeavor in several ways. Here's what our experts are fluent in.
We’re able to support you with modernizing an existing system, simplifying the integrations, or building a new FinTech application from scratch.
Read more: How our FinTech Client Achieved a 30% ROI in Tech?
FinTech applications are revolutionizing how we manage our money.
As you can see, the benefits of FinTech are numerous, from increased efficiency and security to greater convenience and accessibility for customers.
As the world of finance continues to evolve, it's clear that FinTech will play a crucial role in shaping the future of finance.
Stay ahead of the curve by exploring the latest developments in FinTech and how they can benefit your business.
If you want to take it to the next level and develop an innovative application – feel free to contact us.