The Five Greatest FinTech Obstacles and How to Overcome Them
A total of $134 billion will be invested in the financial technology sector in 2021, a significant increase from the previous year before the COVID-19 epidemic. 177% more than last year. Statista predicts that by 2024, the industry will be worth €188 billion.
Even though finance is a rapidly expanding business, it still faces many obstacles. You’ll discover finance’s largest issues, how to fix them, and current options. And fintech software development company can help with this – https://evnedev.com/industry/fintech/fintech-software-development-company/.
Over 25,000 banking firms existed by 2021. This year, not all applicants can join. The difficulties and lost chances are very heavy. Let’s talk about it.
- Protection of Private Information
The average expense of 2021’s 1,862 data leaks was $4.24 million. This report poses data security and privacy concerns. Businesses need to understand that they could lose not only customers but also money.
A financial program with these safeguards in place can help you avoid a data breach:
- Two-factor authentication;
- Biometric authentication;
- 256-bit AES encryption;
- Notifications about all actions.
Having your answer subjected to frequent vulnerability tests is a great way to keep hackers at bay. At least one exam per calendar year is required. In addition, testing needs to be done after incorporating and updating at regular intervals.
- Regulations and Enforcement Rules
Fintech faces difficulties due, in part, to the excessive government oversight of the high-risk nature of the business. Businesses must obey the GDPR, GLS, Wiretap Act, and Money Theft Control Act.
- Consult a lawyer for advice;
- Get a full-time employee or division to monitor changes in the rules.
The equal potential exists in both possibilities. The only distinctions are in the methods of cooperation and the costs involved. Considering that the GDPR allows for a potential punishment of €20 million, hiring an attorney is a much more cost-effective solution.
- Inadequate Knowledge of Smart Devices and Technology
Banks use outdated computer tools. Their apps aren’t user-friendly. As much as we’d like to see a faster turnaround time, we’re unfortunately unable to do so because of the present emphasis change to improving the user experience.
If you’re developing smartphone software for managing your finances, you absolutely must include the following features to avoid fintech challenges:
- Superior user interface and experience;
- Detailed data display;
- QR code and NFC payment processing.
Fintech application development services allow you to hire a crew of highly qualified individuals to work on your venture. With this, you’ll have the freedom to adopt any feature necessary to give yourself a fighting chance against industry leaders.
- Customer Satisfaction and Return
One of the most frequent difficulties in the field of finance is maintaining customer interest. On day one, the recall rate for financial submissions is only 22.7%, and by day 30, it has dropped precipitously to 5.8%. When attrition rates are low, fewer paying customers remain.
Bettering the user experience is one way to keep more of your current users around. The following are a few illustrations:
- The use of game mechanics and a points-based incentive structure;
- Specialized suggestions on the fly;
- Friendly user interface and experience.
Watch your competitors to see how their tactics affect user experience. Observing how various approaches function in the real world can help you decide which ones are ideal for your new business.
- Customization of Services
Recent data indicates that conversion rates and client satisfaction both increase by 63% thanks to personalized experiences. Future businesses can’t ignore this approach.
Some customization options for your financial technology platform:
- Send personalized push alerts to users based on their location and interests;
- Retarget users with advertisements for goods and services that they have previously shown interest in.
The use of AI to learn about a customer’s preferences is a common facet of personalized services. Artificial intelligence is a hot business growth area this decade.