Fintech remains one of the fastest-growing sectors of the technology industry, and with that, the number of entrepreneurs and innovators seeking to disrupt the space continues to skyrocket each year.
Fintech’s growth owes itself to a number of factors. The vast capabilities of AI and automation changes how the financial industry operates. An ever-evolving regulatory landscape requires new technologies to keep up. And the challenges that need to be solved in every arena from financial markets to data analytics and digital transformation require disruptive fintech.
For founders who have the tenacity to face down the obstacles that come with disrupting one of the most lucrative industries on the planet, the rewards can be staggering. But it doesn’t come without navigating complex challenges related to product development, team building, and cultivating trust in a difficult industry.
How to Build an Innovative, Cutting-Edge Fintech Company
Startups face quite a few trials when first getting off the ground. Whether competing for funding or trying to find the right candidates for the job, there are many steps a new business must take before they can succeed. Building technology platforms that serve investment firms, banks, and other financial institutions also presents its own challenges.
Innovation isn’t always easy. Fear of investment, a lack of leadership, and the inability to deliver ideas to market can prevent a startup from succeeding. The market is uncertain, and those who aren’t prepared will be quickly forgotten.
However, by working to build trust, create change, and communicate value while managing potential risks, you can create a cutting-edge fintech company for the modern world.
It’s important to remember that the financial industry moves slowly, especially as it adapts to new technologies. Many organizations operate on legacy technologies, and some function with none at all.
With such little faith from their clients, up-and-coming technology companies need to build a sense of trust in their products to succeed, which will make it easier for companies to rely on your services without fear of being burned.
According to Stephen Roche, CEO of Saphyre, a leading fintech platform that helps banks automate and expedite pre-trade onboarding processes, ‘You have to instill confidence that a technology is real and here to stay.’
Create Meaningful Changes
Ironic as it may sound, change is the only constant when it comes to technology. Fintech companies rely on a rigorous process of development, evaluation, and improvement to ensure their products withstand the test of time. However, the development process isn’t the factor that’s most important for users.
Many legacy financial organizations are apprehensive about trying new things, meaning fintech companies need to show the benefits that their product can bring and how it can make them more competitive in an ever-changing market.
While each version and iteration is different and changes are important. Customer’s are going to want to know how each change affects their bottom line. Does eliminating a bug make processing faster? Does a new version of a tool improve performance? Explain changes in a user-focused way, and make changes that matter to your users.
Businesses operating in the financial industry face strict regulations that they must meet to maintain compliance with the law. Failure to do so could result in financial penalties or worse.
Many decisions that financial institutions make are directly influenced by the regulatory requirements they’re operating under. For your fintech platform to be successful, you need to be able to help them seamlessly navigate the regulatory environment and ensure they don’t run afoul of the law.
Firms don’t want the risk of being penalized or reprimanded for questioning the current compliance structure. So in order to build a successful fintech company, don’t make them wonder. If you can guarantee that they’ll meet regulations and industry standards, that will also help you earn their trust.
Businesses often can’t see the full picture of what a product or service might bring them. For financial organizations, there’s a general reluctance to make purchasing decisions without first understanding the risks.
Changing minds isn’t always an easy thing, especially in the financial industry, which makes it all the more important to communicate why companies should turn to you and your product. By demonstrating the value of your product, you make it easier for wary business managers to choose you as their go-to source of financial technology.
Roche states that ‘Finance clients don’t get fired or in trouble for the tried and true — there’s a reluctance to work with pioneering fintech firms unless they clearly understand the holistic value.’
Building a disruptive business in any industry comes with struggles, but entering the financial realm as a tech company comes with additional challenges. Keeping these tips in mind can help. Above all else, make sure your company offers recognizable value to your clients.