Fintech has been one of the fastest-growing industries in India since the last decade, and this remains true today. The Indian fintech industry was valued at $50 Bn in 2021 and is estimated to triple its value in the near future. As software is the backbone of the fintech industry, there is rapid innovation and growth in this sector.
For fintech companies to stand out from the competition, it’s essential to stay updated with the latest trends and use them wisely within their products. In this blog, we’ll explore the top software development trends, tools, and use cases in fintech.
A] Top Trends And Practices In Fintech App Development In India
1. AI And ML Integration
The rise of artificial intelligence was nothing short of meteoric. Artificial intelligence and machine learning have significantly changed how fintech apps and software process data for the better. AI-powered software can analyse and process a vast amount of data in a short amount of time. It can create personalised investment strategies that factor in the user’s preferences and risk tolerance.
The top fintech companies in India are now integrating AI and ML in their software. Machine learning helps to analyse patterns with accuracy for predictive analytics. With a combination of AI and ML, fintech software can also offer 24/7 chatbots, which improves customer experience.
2. Open Banking and API Integration
Open banking is a growing trend in the fintech sector, which allows third-party apps to gain financial information from a bank’s customers. This is made possible by the use of APIs (application programming interfaces). The UPI (Unified Payments Interface) is an example of open banking. Third-party businesses can create and offer banking products to customers without the need to obtain a banking license.
Open banking offers several benefits like personalised services and better products to the customers, driving competition. Businesses can build strong open banking infrastructure by partnering with the top fintech software development company in India.
3. Embedded Finance
Embedded finance integrates financial services within non-financial platforms. With this model, businesses can offer payments, loans, or digital wallets directly within their software without relying on traditional banks.
It’s already prevalent—whether it’s paying for a cab ride, subscribing through an app, or purchasing items via a digital wallet. A large portion of fintech software today incorporates embedded finance, and this trend continues to grow.
4. Rise Of Neobanks
Neobanks are banks that do not have any physical location and only exist digitally. Neobanks conduct all their services online like opening a new account, customer service, and offering loans and other financial products. Hence, having software with state-of-the-art technology is the priority for the neobanks.
Unlike traditional banks, neobanks do not have a banking licence and have to partner with an established bank. This requires a robust infrastructure to ensure reliability and scalability. Neobanks can cater to untapped banking customers by offering personalised financial products and services.
5. DeFi And Blockchain
Decentralised finance, also known as DeFi is an emerging trend to remove third-party centralised institutions from financial transactions. Blockchain has been one of the key tools in providing decentralised finance. DeFi could be used to offer microservices such as personal lending and borrowing.
DeFi has been one of the emerging trends due to the transparency, permissionless ness, and immutability of its nature. Businesses can cater to audiences who do not operate with centralised financial institutions due to the paperwork and number of processes. The success of DeFi and Blockchain in the Indian fintech sector depends on user adoption.
B] Top Tools For Fintech Software Development
1. Django
Django is a high-level, open-source Python-based web framework that simplifies and speeds up web development. It’s widely adopted by fintech development companies for its efficiency and cost-effectiveness.
Django supports rapid MVP (minimum viable product) creation, allowing businesses to adapt to market needs quickly and effectively.
2. Python
Python is by far the most used programming language in the fintech sector. There can be several reasons why a fintech application development company would like to use Python. It is easy to learn and has a wide user base, making Python developers extremely accessible. Coding in Python often results in fewer bugs, which is crucial for the success of Fintech companies.
One of the key advantages of Python in development is that it takes less time to develop, test, and market Fintech applications. As trends in the fintech industry change rapidly, the flexibility of Python becomes a handy tool for developers and businesses alike.
3. React JS
React JS is an open-source javascript library developed by Facebook. It is used for developing the front-end aka UI. It needs to be used along with a different development language to develop the complete software. However, the number of fintech software developers using it makes it a must on this list.
React JS makes front-end development extremely easy with its easy-to-use interface. The presence of a thriving community for support and learning makes it an excellent platform for businesses of all sizes. It has exceptional development speed, cross-platform development capabilities, and native-like performance amongst other features.
4. Java
Java is one of the most recognised and popular general-purpose, object-oriented programming languages. It is widely used in the financial services sector, including by banks for front-end, customer-facing applications. Java is able to provide high-performance, secure, and adaptable software solutions, which is a must for fintech businesses.
Several big-name organisations are built using Java and Java frameworks including Paypal. One of the key reasons why Java is preferred by so many developers is its reliability and stability which is also crucial for financial transactions. Software created using Java can run on any operating system, making them truly versatile and scalable.
C] FinTech Software Development Use Cases
- Digital Banking: Digital banking refers to the use of applications and software to conduct banking without the need to visit the bank in person. This offers several benefits to the customer like accessibility and convenience. As a result, several banks and financial institutions are investing in digital banking software.
- Insurance Technology: Insurance is a big part of the modern finance sector. Fintech insurance technology helps to access risk, choose better insurance providers, easily calculate the EMIs, and get a summary of the terms of the policy. Insurance management apps are making it easier than ever to subscribe to an insurance policy by automating KYC.
- Personal Finance Management: Personal finance management apps are more popular than ever. As more and more people are learning about the importance of personal finance, there is a demand for better PFM apps in the market. Easy-to-use UI and smooth navigation are the core features of personal finance management apps and software.
- Payment Processing: In recent years several payment processing software have emerged in the market. Even apps that focus on non-financial services are offering payment processing services due to their demand and convenience. It works as an intermediary during transaction processing and can even be used by small businesses.
- Investment: The rise of investment software has made investing in securities accessible to everyone. There are several big-name investment software in India, while several others are released every year. Investment apps can replace traditional brokers, reducing transaction costs and time. It streamlines the purchasing and selling of securities like stocks.
- Tax Management: Tax tracking and management has become one of the best fintech developments. It helps to simplify the process of calculating your taxes and filling them. Tax management software helps individual users as well as finance organisations to simplify creating, submitting, and managing tax papers.
Conclusion
Fintech is a dynamic and rapidly evolving industry. Staying ahead of the curve with the latest software development trends and technologies can give businesses a competitive edge. The future of fintech holds immense potential, and adopting emerging innovations today will pave the way for long-term success.
Siddhatech is a leading fintech software development agency based in Pune, India. Looking to build scalable and modern fintech software? Get in touch with our expert team today!
FAQs
Expertise, experience, and reputation are the three main things you need to consider when choosing a fintech software development company in India. Other factors like communication bridge, cost, portfolio and online reviews will help you short-list your options.
By having a fintech software customised for your business needs, you can optimise its performance and potential. This not only improves customer satisfaction but also helps your business scale efficiently.
The level of skilled developers and the cost of development are significant factors why most foreign developers are choosing to outsource their development. Agile innovation and reduced time to market means businesses can develop and launch their fintech products faster.
Most fintech developers in India put emphasis on security and regulatory compliance. Data encryption, secure authentication, regular security audits, and adherence to regulatory standards work together to ensure your software is completely safe from malware and other security threats.
Artificial intelligence, DeFi, machine learning, blockchain, embedded finance, and open banking using APIs are the top emerging trends in fintech software development in the 2020s. These technologies offer several advantages to businesses including improved customer service, innovation, and convenience.