Estimating Cost of Software Development Project for Fintech

It’s a golden period for the fintech industry since the fintech software market is on the rise with a prediction to increase by USD?22.66 billion between 2023-2028, with the focus being on phenomenal sustainable growth. Most fintech software development companies do not want to miss out on the boom where everyone else is looking to change the way their consumers access, handle, conduct, and keep track of their finances through advanced technology. But most of them are pondering around the same question. How much do I have to pay for developing Fintech software, and how long is it going to take? Is your mind buzzing around the same question? Well, it can depend on several factors. Estimating the costs at the planning phase could save you from uninvited troubles. This blog is a roadmap for you to understand how much it can cost to develop fintech software, the hurdles you may face during development, and how you overcome those challenges.?

Factors influencing the cost of developing Fintech software

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1) Project complexity

Requirement gathering is one of the initial phases of software development for fintech, where we define the project scope and its complexity. We decide upon the features, efforts, and development time required for incorporating those features. The difficulty of developing the project increases with the complexity of your project.

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2) Time invested in development

The time required in software development for fintech depends proportionally on the complexity of its features and the platform version. If you are going to implement advanced tech like real-data processing,?artificial intelligence, or?blockchain, it may take plenty of time than usual, depending upon the skillset of your development team.

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3) Need for flawless UI/UX

Users like to use those fintech apps that have a simple yet?flawless user interface?where there is a balance between the two.? To give your users a great experience, it's important to invest in user interface design. Pick the right animations, transitions, and layouts, and test everything to ensure it works smoothly and is easy to use.?

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4) The location you choose

Pick the geographical location very wisely while estimating the cost of developing fintech software since currency value varies for different countries. You will get a much more affordable project quote estimate from an offshore fintech applications development company that’s based in your location as compared to the ones that belong to America or Europe. ?

5) Maintaining software quality

Even after the launch, the app may crash due to poor performance or bugs that are complex to resolve. The software also must remain functional despite the updates in third-party APIs. Some improvements come from the user’s feedback as well that need to be implemented in the software and require an extra investment of money.?

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6) Development team’s skillset

Hiring fintech software developers in your company who have previous experience in providing?fintech software development services will make them more familiar with its ecosystem. However, the disadvantage is that you would have to manage extra expenses like their salaries and taxes. So a better option would be to outsource fintech software developers from reputable outsourcing firms or a fintech app development company that specializes in fintech development outsourcing.

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Advanced features that could cost a pretty penny

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1) Know Your Customer (KYC)

Fintech software solutions must be able to verify the identity of a user and determine if the person has any fraudulent intentions. Any illegal money obtained from money laundering or drug trafficking can ruin the reputation of a fintech app development company. This is the reason why you need KYC verification to make sure you are giving the services to the authenticated user and protect yourself from fraud.?

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2) Multiple Payment Options

Consumers are more likely to pay when they find a payment method that suits their preferences. By providing multiple payment gateways to users and adapting to how they prefer to pay, you can enhance your conversion rate and broaden your consumer demographic. With a simple transaction process, consumers will be compelled to use your services again.

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3) Personalized pop-ups?

Fintech companies also need to focus on personalizing the messages for a better user experience. Personalized notifications keep the users up to date on their finances and alert them in case of fraud. You can also market the schemes and offers with updates and announcement messages to make the most of their campaigns.?

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4) Biometric authentication

It's necessary to detect fingerprints or physical behavior for?cybersecurity, but customers don’t want to wait a second longer for transactions. If you invest in biometric authentication, users can quickly get authorized, sign in to their account, and make quick transactions. Even fraudsters with 3-dimensional face maps or eye scans can’t beat this technology.?

5) Interactive AI Chatbot

AI chatbots and virtual assistants can handle everything from payments and transfers to loans and account management. Having them integrated into your fintech software is a must, as they can provide human-like customer service, deal with payments and investments tirelessly, prevent data leakage, and also improve the productivity of your team.

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6) QR Code Scanner

A recent study by?Juniper Research forecasts that global spending through QR code payments will cross $3 trillion by 2025, and it will become a common mode of payment, thanks to its frictionless and error-less payment service. The end-to-end data security properties that QR code offers are an important feature that can’t be neglected while developing Fintech software.

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7) Real-time Analysis and Reports

With the real-time data analytics feature in your software, you can stay compliant with regulatory standards, take immediate action on cases involving suspicious transactions, and reduce the chances of financial risks. It also helps in continuously?monitoring financial portfolios and adjusting them according to market fluctuations.??

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Let’s break down various kinds of Fintech apps

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1) Budget expense tracker apps

Personal finance apps act like financial advisors who help you keep track of your salary and expenses automatically. You can organize your bills, check your balance, get payment reminders, manage credit/debit cards, and make money as well through referral programs from such apps.?YNAB and?Goodbudget are some of the best apps you will find to keep track of every penny you earn and plan your finances wisely.?

Estimated development cost: $50,000 to $300,000?

Development time (roughly): 1500 to 2500 hrs

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2) Money lending apps

Lending apps offer a bunch of options for users to use their funds for their personal needs, like?healthcare check-ups, education loans, marriage, family trips, home refurbishment, and settling debts. They nullify the need for paperwork and require minimal documentation.?Investkraft and?Navi are some RBI-approved apps that allow you to get all kinds of insurance, FDs, loans, and mutual funds.

Estimated development cost: $50,000 to $300,000?

Development time (roughly): 2000 to 2500 hrs

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3) Trading apps

If you are looking to manage your portfolio, get an overall view of the market, and buy and sell stocks, cryptocurrency, and ETFs, then investment apps can help you with that. You will get detailed and well-researched reports on various publicly traded companies. If you are looking to automate investing, you can go for apps like?Betterment, and just in case you are new to this game,?Charles Schwab can guide you in managing your portfolio.

Estimated development cost: $60,000 to $120,000 ?

Development time (roughly): 1500 to 2500 hrs?

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4) Banking apps

Banking apps are mostly used in PSUs and private sector banks as they offer convenience in doing quick online transactions. Users can schedule credit card payments, get their account summary, set limits on purchases, and automatically pay their bills without having to be at the bank physically.?Kotak-811 and?HDFC Bank Mobile Banking are some of the popular banking apps that are known for their modern UI and stunning features.?

Estimated development cost: $30,000 to $300,000?

Development time (roughly): 2000 to 3500 hrs

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5) Insurance apps

Insurance apps raise the bar of customer satisfaction and safety that many insurance companies offer. These companies offer the best commission plans for their users. Insurance apps help them choose the best options. These apps provide an easy way to monitor their spending and get updates on credit card returns.?Bajaj Allianz Insurance Wallet App and?Policy Bazaar are a few notable apps that users can use for complete financial analysis.

Estimated development cost: $30,000 to $300,000?

Development time (roughly): 2000 to 3000 hrs

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Learn how to develop the best Fintech software step-by-step

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1) Gathering requirements?

When you have the idea in your mind, it's necessary to begin from the smallest details and understand the user psyche and the market you are targeting, apart from determining the monetization model. Then you can easily estimate a rough budget and projected deadline.

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2) Designing the interface

This is where the users will interact with the system, so you need to make sure the interface, its features, and its functionality are easy to use. The user should be able to navigate without any struggle, and you should try to avoid bombarding the system with irrelevant features.

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3) Developing the MVP

Understand what problem your product solves and?create an MVP with basic features that can be used as a sample for gaining user feedback. In this way, you will determine the feasibility of your project as well as get insights into the features that could be included in your project.

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4) Testing its feasibility?

Testing of the product is important to make sure it is reliable and can securely handle sensitive data, manage their finances, and is compatible with the regulations. It also involves simulating cyberattacks on the system to spot its weaknesses and fix them effectively.??

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5) Deploying the product

After rigorous testing, your product will be prepared for deployment. When it gets deployed, your job will be to continuously monitor the performance and resolve any performance issues that occur. You can also gather reviews and improve the functionality as per their preferences.

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6) Maintenance and update

As financial regulations keep on changing with time, you should conduct compliance monitoring in a short span of time to avoid getting into legal trouble and fines.? Your focus must be on these 3 areas—security of data, compliance with regulations, and continuous improvements through feedback.

Challenges in Fintech software development

1) Being compliant to regulations

With the introduction of new technology and market demand, the regulatory standards also change. To counter these changes, you need a development team that is well aware of financial regulations and adheres to them. This is where you could integrate AI to make the process error-resistant and smooth.

2) Security of vulnerable data

The issues of data ownership, compliance, and security risks are bound to arise as most FinTech's partner with banks and other financial institutions. A major problem is the lack of data standardization, as FinTech's often aggregate diverse data sources to maintain data integrity. With increasing regulatory scrutiny, you'll have to invest in robust data security planning.

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3) Integration of advanced tech

One of the main problems is the slow speed of building integrations from scratch, which can stretch the development time. However, there is a growing need for end-to-end monitoring and low-code solutions. It permits the fintech software developers to manage integrations. However, data mapping can be a slow process, so it's important to have tools that let non-technical staff take part in it.

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4) Scalability and reliability

To improve load distribution and accommodate an increasing user base and high transaction volume without hampering performance, you need a scalable cloud-based architecture right from the beginning. Based on the demand of users, you can scale your resources dynamically. with?cloud computing, as it permits the addition or removal of servers to handle fluctuating loads.

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Outsource the best software development team to minimize costs

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Predicting the future of the fintech industry would be like estimating the weather conditions—nearly impossible. But as you might have understood by now, the cost of developing fintech software isn’t the sole factor behind launching fully functional and secure FinTech software. It is the factors around it that determine if the project will turn out to be a success or not. But it’s clear that having a proficient and well-experienced?custom software development team by your side can significantly minimize the expense of the fintech software solutions you need.?

With more than 10 years of experience in software development,?Webelight Solutions Pvt. Ltd. carries the expertise to provide fintech software development services and help the fintech industry automate and modernize its manual operations. ?We are one of the best fintech software development companies out there that also specialize in fintech development outsourcing and can develop customized fintech software solutions for you with real-time data processing, secured gateways, and advanced data analytics features that are compliant with regulatory standards and provide a smooth user experience.?

Get a quote from us today for budget-friendly, secure, and scalable FinTech software solutions.