COVID-19 hasn’t impacted negatively on every industry there are a few who somehow managed to ride the wave, perhaps unexpectedly. I am talking about none other than our IT outsourcing industry. And slowly and steadily with the help of a few technological changes, we all will be able to survive and succeed. For example, in the healthcare scenario, collecting and using relevant data, wearables, and VR can assist in making care more accessible whereas the financial sector demands contactless options to accelerate digital adoption. Now let us discuss Outsourcing fintech software development and how it will benefit fintech businesses.
Two souls, one heart! Fintech has been a lot in demand lately and we are fortunate enough that even during such a COVID-19 pandemic, it is showing no signs of slowing down. Of course, there is no shadow of a doubt that COVID has led to a worldwide recession of immense proportions. In fact, several industries like restaurants, the transport sector, manufacturing organizations seem to have closed down lately Especially the ones that are heavily dependent on the conventional way of doing business. as they are unable to make it (expense is way higher than their income).
Now let us forget about other industries, time to focus on financial businesses can benefit by outsourcing fintech software development.
Table of Content
- What is the Hype About Fintech Outsourcing & Software Development?
- Why need to choose outsourcing software development services for companies?
- The Major Challenges Faced by Fintech Businesses here are:
- Do You Agree that Outsourcing is meant for a financial business?
1. What is the Hype About Fintech Outsourcing & Software Development?
Over the years Fintech or financial technology seems to have played a pivotal role in not just introducing the concept of online payments but making things way easier for both the banking sector as well as their valued customers. If you take a look now, fintech is no longer a mere term but it has become a growing trend – all thanks to the increase in digital payment.
It may quite interest you to know that over two billion people in the world do not have access to a bank account. However, it is not a new concept, it has been since 1950. The year when ATMs and credit cards made it possible for people to access their finances without visiting the bank branch. And look at the banking and finance sector now, mobile technology, online loans and even cryptocurrency.
Here comes the big question what is fintech outsourcing? With tech and innovation growing hand-in-hand, startups have no option other than to become increasingly dependent on each other. After all, hiring software developers, product managers, and finance experts can be affordable by only a few startups and not all. As a result, more and more banks have started to look to outsourcing to access tech talent that can help them compete with young, disruptive fintech.
A software outsourcing company can provide developers that focus specifically on mobile, software support, or UI/UX design so the fintech company can concentrate on growing the business. On and all, Financial technology outsourcing is a business strategy employed by financial technology companies. Here, a company hires a third-party service provider to handle part of its operations. This helps them reduce the workload for their in-house team, and lets the company focus on core activities. Outsourcing is an especially effective strategy for businesses.
2. Why Need to Choose Outsourcing FinTech Software Development Services for Companies?
1. Cost Efficiency
Considering the fact that around 31% of software development has been outsourced and the project outsourcing growth in the upcoming years. By choosing an appropriate fintech app development company, you can choose the right technology to build a feature-rich fintech app for your company and all the business operations can run smoothly. Outsourcing somehow happens to be a cost-effective option and maybe that’s why it is loved by several banks and financial companies.
As a result, companies can save immense overhead expenses including payroll, equipment, and hardware costs and administration costs while developing customized applications. Now have you ever wondered why is this so? Usually when you do not opt for outsourcing a significant increase in cost happens. Come on! Software development is no cookie-cutter; it incorporates several equations, additions, reductions, resulting in continuous change in requirements and business procedures. Thus, the cost also fluctuates. Whereas in outsourcing fintech software, that’s not the case! Outsourcing software development itself being so cost-effective option so even if there are ups and downs, you will find it a more convenient option in comparison to choosing in-house software development companies.
2. Data analytics – These moments one must milk for!
The entire finance industry survives on data collection and analytics. By doing this, they have successfully been able to reduce risk when underwriting loans, issuing securities or trading futures. By outsourcing partners, fintech organizations can come up with software that enables them to analyze ample customer data. This results in increased sales and promoting customer loyalty. Right from their credit scores to their spending habits, everything is been monitored carefully via software just to offer tailored services for each prospect.
How outsourcing or offshore development services works wonders here? Well, most of the offshore service providers tend to choose python as their programming languages for the data analytics software so that the financial institutions can not just track accurate information but also ensures security and high-end protection of their valuable data from non-stoppable cyber crimes.
3. Global Reach
Another major advantage for the financial companies offered by outsourcing developers is the insane global reach. Since we are talking about outsourcing, there are pretty fair chances for the technology partner to assist you in promoting your software globally. In simple words, companies open up to a new world and introduce themselves to a new marketplace.
Also, the change significantly increases the number of the target audience for the business and gives plenty of development opportunities. Hiring an offshore team gives you the chance to improve your international relations and establish a team with expertise working in your domain.
4. Innovative Approach
When nothing works right, turn left! Say, for example, Airbnb or Uber or WeChat services, I am pretty sure you must have read all their success stories, of course, based on technological innovations. In fact, some of these transformed the way we live and work. For example, I have observed that many of us including companies have started using virtual wallet apps to make the financial transition easy and hassle-free.
By outsourcing a team of professionals and their services, companies can even succeed in integrating disruptive yet emerging technologies such as AI, AR, and iOT all into one single app for improving user experience and bringing automation into the processes. Also, this collaboration can successfully take your business to the next level in no time.
5. Better Time and Data Handling
Last but certainly not least is the best optimization of data and time for the business. The offshore services provider do comprise of specialized teams of experts who exactly knows what needs to be done to reduce development times and come up with quick, agile results and consistent quality. After all, this is the only way they end up meeting the high-end demand of different organizations.
Apart from time, security breaches or data exposure has become a severe threat and the most important challenge being faced by many financial executives these days. After all, crucial information like social security numbers or credit/debit card information, salaries, spending habits, house habits, etc are being stored. This will definitely attract a lot of bad guys! Fret not, you can ask your offshore development partner to incorporate cybersecurity defense services. After all, it’s high time we must pull up our socks against incredibly increasing cybercrimes.
Well, I am not biased at all. I can go on and on with the advantages offered by outsourcing fintech software development but that doesn’t mean it does not possess any downsides. The major challenges of Financial technology outsourcing gravitate around overall operational resilience. As a result, they are often chained in a vicious line resulting in damaging the project.
3. The Major Challenges Faced by Fintech Businesses here are:
Of course, your offshore tech partner will ensure to offer enough security but what if he fails. I mean having a slight lack of cybersecurity will result in an entire failure. And god forbid if the software is been exploited by a cybercriminal this will cause much more trouble than direct financial damages: business disruption, heavy penalties, lost reputation, and customers.
2. Tacking Emerging Risks
FinTech companies need to keep up with the technological risks otherwise the segment will end up crashed in the market. Which is indeed a major concern!
3. High Quality
Lastly, the quality of solutions provided by the offshore tech partner is another unseen challenge in itself. I mean to decide whether it’s good, bad or better is critical considering from different customer perspectives. Also, failing to comply with regulatory requirements for operational resilience due to the poor quality of a Fintech software solution may have serious consequences.
4. Do You Agree that Outsourcing is Meant for Financial Business?
So what to do? Whether to give in or not! Well backing off is not an option especially considering the present times. But what we have in our hands is to play smartly. I mean you will encounter a truckload of good readings about the concept. So before picking a partner ensure that you know everything. Apart from this, try to keep looking for a few common aspects such as their corporate culture or are they well in regards to communication? How is their technical competence? Do they carry any industry expertise? If yes, which clients they have already worked for? Get testimonials, reviews as much as you can?
Also, right from the beginning pay attention to how customer-centric your prospected outsourcing partner is. So that’s all for now! I hope you enjoyed reading the post. Keep watching the space for better perspectives regarding the same.