E-Wallet Systems in the Fintech Industry With Go: A Benefit Analysis

Open Spaces is a Gun.io series dedicated to exploring the world of technology through the eyes of our community’s engineers. This week, we’ve invited Priyansh N., a solutions architect with 8+ years of experience in top product-based companies and a Golang guru, to explain the benefits of using Go for E-Wallet Systems.

The rise of e-wallets, or digital wallets, has revolutionized how people manage and transfer money. From their humble beginnings as a niche innovation, e-wallets have quickly become an integral part of the global fintech ecosystem. With the global e-wallet market projected to reach $17.11 trillion by 2029, growing at a compound annual growth rate (CAGR) of 19.67% from $6.97 trillion in 2024 (Grand View Research), it’s clear that demand for robust, scalable, and high-performance e-wallet systems is increasing at an exponential rate. This growth comes with the challenge of handling millions of transactions per second while ensuring reliability and security.

To meet these challenges, the technology stack behind e-wallet systems needs to be resilient, scalable, and efficient. Golang (Go), a programming language known for its performance and scalability, emerges as the ideal solution for building the backend of modern e-wallet systems.

What are E-Wallets?

E-wallets (also known as digital wallets) are tools that enable users to store, send, and receive money electronically. They allow users to make payments, manage funds, and conduct transactions without needing physical cash or cards.

Companies like Uber and Amazon rely on e-wallet systems that process millions of transactions daily, requiring scalable infrastructure to ensure reliability. E-wallet systems must handle vast amounts of transaction data, especially during peak times like Black Friday or other holiday sales, where systems can sometimes experience transaction spikes of up to 10,000 transactions per second (TPS).

Programming Languages for Wallets

Golang

• Advantages: Golang combines fast compilation times, efficient concurrency, and simplicity, making it an ideal choice for scalable, high-performance applications like e-wallet systems. It excels in handling concurrent requests, is microservices-friendly, and is supported by a rich ecosystem of libraries.
• Limitations: Golang has a smaller selection of third-party libraries compared to Node.js, but its simplicity often reduces the need for an extensive library set. (Kinsta)

Node.js

• Advantages: Node.js is known for its event-driven, non-blocking I/O model, making it suitable for real-time applications. It also benefits from a large ecosystem of libraries.
• Limitations: Node.js operates in a single-threaded environment, which can lead to performance bottlenecks when handling CPU-intensive tasks (Granulate). Scalability can be challenging when managing many concurrent connections.

Rust

• Advantages: Rust is a systems programming language offering performance comparable to C++, with built-in memory safety features and concurrency tools.
• Limitations: Due to its strict safety and concurrency models, Rust’s steep learning curve and longer development times can slow down development.

Why Golang?

Golang’s efficiency in handling high-volume transactions and scalability make it an excellent choice for building e-wallet systems. Here are a few reasons why Golang stands out in the context of fintech applications:

1. Concurrency and Performance: Golang’s lightweight goroutines allow for the handling of thousands of concurrent requests. This makes it ideal for processing real-time transactions, a critical feature for e-wallet platforms that may need to manage spikes of up to 10,000 TPS. Moreover, Go’s compiled nature ensures low-latency execution, essential for providing fast, real-time responses.
2. Simplicity and Scalability: Golang’s simple syntax and microservices-friendly architecture make it highly adaptable. The language is designed to be straightforward, which reduces the likelihood of bugs and makes the codebase easier to maintain. Furthermore, Go’s built-in support for horizontal scaling ensures that e-wallet systems can grow with the demand.
3. Security and Reliability: Security is a top priority in the fintech world. Go’s ecosystem provides powerful built-in tools for encryption, API security, and network communication, helping protect e-wallet systems from cyber threats and fraud.
4. Proven Success in Fintech: Major players in the industry, like Monzo Bank and American Express, have successfully adopted Golang for their backend systems, handling millions of transactions with ease. For instance, Monzo has scaled to serve over 5 million customers and processes 4,000 transactions per second during peak times (Kinsta).

Programming Languages for Wallets

When developing e-wallet systems, it’s important to consider other programming languages. Here’s how Go compares to alternatives like Node.js and Rust:

Golang

• Advantages: Golang combines fast compilation times, efficient concurrency, and simplicity, making it an ideal choice for scalable, high-performance applications like e-wallet systems. It excels in handling concurrent requests, is microservices-friendly, and is supported by a rich ecosystem of libraries.
• Limitations: Golang has a smaller selection of third-party libraries compared to Node.js, but its simplicity often reduces the need for an extensive library set. (Kinsta)

Node.js

• Advantages: Node.js is known for its event-driven, non-blocking I/O model, making it suitable for real-time applications. It also benefits from a large ecosystem of libraries.
• Limitations: Node.js operates in a single-threaded environment, which can lead to performance bottlenecks when handling CPU-intensive tasks (Granulate). Scalability can be challenging when managing many concurrent connections.

Rust

• Advantages: Rust is a systems programming language offering performance comparable to C++, with built-in memory safety features and concurrency tools.
• Limitations: Due to its strict safety and concurrency models, Rust’s steep learning curve and longer development times can slow down development.

Using Go for E-Wallet System Architecture for Fintech: Case Study Insights from Monzo and American Express

A microservices-based architecture is crucial for building a high-performing, scalable e-wallet system. For example, Monzo and American Express have leveraged this approach to support millions of users and handle massive transaction volumes as they faced significant challenges in developing scalable, efficient, and maintainable systems to support their extensive financial operations. Below, we explore key architectural components, their roles, and how to ensure scalability, security, and reliability using Golang.

Monzo Bank

Monzo uses Go to handle over 5 million customers, processing 4,000 transactions per second during peak times. The platform enjoys 99.9% system uptime and has reduced operational costs by 20% (Monzo).

Monzo aimed to build a banking platform capable of scaling to hundreds of millions of customers worldwide, ensuring 24/7 availability without maintenance windows or single points of failure and enabling rapid feature deployment. To address these needs, Monzo adopted Go (Golang) to construct a microservices architecture, allowing independent development and deployment of services. Go’s concurrency primitives facilitated the handling of high-volume, low-latency distributed applications. At the same time, its simplicity enabled the creation of small, focused services adhering to the single responsibility principle, enhancing maintainability. (InfoQ, The Register)

American Express

After migrating critical services to Go, American Express achieved a 30% improvement in transaction processing speed and reduced payment processing latency to under 100 milliseconds (American Express).

American Express required a high-performance language to manage over a billion transactions monthly and support network programming for backend REST/gRPC APIs. The company sought a solution that offered an open-source toolchain, libraries, and a large community to support development. By adopting Go, American Express achieved 140,000 requests per second in internal benchmarks, meeting performance expectations. Go’s concurrency model allowed efficient handling of numerous simultaneous transactions, and its robust tooling, including a built-in testing framework, profiling capabilities, and benchmarking tools, facilitated effective development and optimization. (American Express)

Through the adoption of Go, both Monzo Bank and American Express successfully addressed their respective challenges, resulting in more scalable, efficient, and maintainable systems.

Key Components of E-Wallet System Architecture Using Golang

An e-wallet system requires careful design; below is a break down the key components of an e-wallet architecture and how Go optimizes each of them:

1. User ServicePurpose: Manages user operations like registration and authentication.Go Optimization: Handles 100,000 concurrent user requests per instance with response times under 50 milliseconds.
2. Transaction OrchestratorPurpose: Coordinates multi-step transactions, ensuring consistency.Go Optimization: Implementing the Saga Pattern improves transaction consistency and reduces failure rates by up to 25%.
3. Payment Gateway ServicePurpose: Connects with Payment Service Providers (PSPs) for payment processing.Go Optimization: Go handles 5,000 payment authorizations per second, minimizing network-related errors by 50%.
4. Ledger ServicePurpose: Ensures immutable records of transactions.Go Optimization: Event sourcing provides a complete audit trail, supporting billions of transactions per month with minimal performance degradation.
5. Notification ServicePurpose: Delivers real-time transaction notifications to users.Go Optimization: Event-driven architecture improves notification delivery times by 30%, ensuring real-time notifications even during peak loads.

Additional Considerations for E-Wallet Systems

1. Containerization and Orchestration: Tools like Docker and Kubernetes ensure scalability and service reliability. Monzo uses Kubernetes to handle traffic spikes of up to 300% during peak times.
2. Service Mesh Integration: Tools like Istio manages service communication, improving latency and reducing errors.
3. Security and Compliance: E-wallets must adhere to PCI DSS and GDPR standards. Implementing end-to-end encryption and multi-factor authentication enhances security.

Optimal Design Patterns for Transaction Orchestration in Golang-Based E-Wallet Systems

Design patterns like the Saga Pattern and Event-Driven Architecture (EDA) are highly effective in ensuring robust performance and reliability. These patterns enable high availability and fault tolerance, which are essential for financial systems.

Best Approach for Golang-Based E-Wallet Systems

Combining the Saga Pattern and Event-Driven Architecture offers optimal performance and scalability for e-wallet systems.?

• Concurrency: Golang’s goroutines enable the system to handle millions of concurrent transactions asynchronously.
• Scalability: EDA allows services to scale independently, which improves system scalability by 35%.
• Resiliency: By combining Saga with EDA, system downtime can be reduced by 50%, ensuring robust error handling even during high traffic.
• Communication Efficiency: Using gRPC and Apache Kafka for inter-service communication ensures low latency, reducing it to under 10 milliseconds.

Overcoming Common Challenges in E-Wallet Development

Developing an e-wallet system is not without its challenges. Here are some common issues and strategies to address them:

• Security Concerns: To protect sensitive data, implement end-to-end encryption, multi-factor authentication (MFA), and regular security audits (Nimble App Genie).
• Regulatory Compliance: Integrate compliance checks for standards like PCI DSS and GDPR, ensuring legal adherence and protecting user data. (PCI Security Standards).
• Scalability: Use microservices and cloud-based infrastructure to scale services independently and manage increasing transaction volumes efficiently. (Codiant).
• User Adoption: Design intuitive user interfaces, offer incentives, and provide comprehensive support to encourage users to switch from traditional payment methods. (Idea2App).

Performance and Benchmarking of Golang for E-Wallets

Golang’s performance in handling high loads is remarkable. For instance,?

1. RESTful API Performance: Golang’s Fiber framework can handle up to 1 million requests per second (RPS), far outperforming Node.js Express (10,000 RPS) and Python’s FastAPI (9,000 RPS). (Go Performance Dashboard)
2. Microservices Frameworks: Golang frameworks like Echo and Gin show latencies as low as 2 milliseconds per request, which is crucial for real-time financial transactions. This is especially important for e-wallet systems, which need to maintain low-latency responses even during peak transaction volumes.

Conclusion

E-wallet systems are the backbone of modern fintech, and as demand for these services grows, so does the need for high-performance, scalable solutions. Go (Golang) is a prime choice for building such systems, offering unparalleled concurrency, scalability, and security. Its efficiency, simplicity, and ability to handle high loads make it the language of choice for major fintech companies like Monzo and American Express.

By combining Go with effective architectural patterns like the Saga Pattern and Event-Driven Architecture, developers can build resilient e-wallet systems that meet the high demands of the fintech industry. With the right approach, e-wallet platforms can scale seamlessly, offer low-latency performance, and maintain robust security as they grow.

References

• Global E-Wallet Market Size & Share Report, 2021-2028 – Grand View Research: This report provides an in-depth analysis of the e-wallet market, including size, share, and growth trends. (Grand View Research)
• Monzo Engineering Blog – Insights into their microservices architecture: Monzo’s blog offers detailed insights into their microservices development process and architectural decisions. (Monzo)
• American Express Tech Blog – Case studies on performance improvements: American Express’s investor relations news details their financial performance and strategic initiatives. (American Express)
• Golang Benchmarking Data – Official Go documentation and community benchmarks: The Go Performance Dashboard provides centralized resources for sharing and analyzing benchmark results. (Go Performance Dashboard)
• PCI DSS Compliance Guidelines – For security and compliance metrics: The PCI Security Standards Council offers comprehensive guidelines for enhancing the security of payment card account data. (PCI Security Standards)

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