Financial technology (FinTech or fintech) is the term used to describe any technology that aims to automate or improve the use and delivery of financial services through mobile payment applications, online banking, and cryptocurrency platforms. It competes with traditional financial institutions to ease consumers’ access to financial products and services.
Due to the omnipresence of this technology and its innovative features to help meet consumers’ financial needs, the fintech market has seen a massive boom over the last decade. Progressing at a CAGR of 13.9%, the research presented in this report predicts that the market size of the fintech industry will reach $16652.68bn by 2028. That’s massive growth!
As a result of these mind-boggling prospects, more and more investors are looking to build a fintech startup and cut out their slice of the pie. While the number of financial technology startup companies surpassed the 25,000 mark last year alone, it’s not too late to start your own fintech company! This brief article will discuss why you should now set up a fintech startup!
Things to Know Before Starting a Fintech Company
Sadly, a huge and common pitfall many aspiring fintech companies make is attempting to build a fintech startup without conducting proper research and market analysis. Like any other venture, you can’t just copy and paste the existing models. You must do your due diligence and find your unique offer before you launch a fintech startup. Starting a fintech startup isn’t that easy. However, for the sake of brevity, listed below are a few points to consider before embarking on a journey to start up a fintech company:
- Solid team
- Great product
- Understanding compliance laws
- Identifying your target niche
Now that you are acquainted with some of the essential points to consider, let’s briefly explore five (5) reasons why you should set up a fintech company this year:
1. There’s a Huge Demand for It
The most critical question on the mind of aspiring investors and online businesses is the question of demand. People want to know the demand for their potential products and services before investing. Unlike some other endeavors, there’s a massive demand for fintech.
The fact is that there is an overwhelming need among users to control their finances at the touch of a button, and let’s face it, traditional financial services do not present that kind of ease of operation. However, fintech apps make it relatively easy for users to manage or invest their money without going to the bank or rummaging through a mountain of paperwork. Because of these conveniences and the widespread application of fintech, there’s an enormous demand for it. Although there were over 25,000 fintech startups last year, the market remains unsaturated. Keep this in mind as you plan to create your own fintech company: there’s a demand that you can meet!
2. It Is Easier to Build a Fintech App Today
Building a fintech startup was more challenging in the early years of this technology than it is today, and this was because of the expertise required to develop a fintech app. But this is not the case today. Many developers have gained knowledge and experience in creating these kinds of applications. In addition, there’s more support for developing fintech apps as specialized toolkits are now more widespread and readily available.
3. Fintech is Gaining Acceptance Among Banks and Governments
Another reason you should launch a fintech company as soon as possible is that the industry is gaining unprecedented traction and acceptance from traditional financial institutions and governments.
In its early days, one of the biggest challenges of the fintech industry was the fear of scams and fraudulent activity since the entire technology was online-based. But with proper regulations and certifications, fintech companies are now beginning to earn the trust of banks and governing bodies. Not only have traditional financial institutions accepted the digitized system of providing financial services, but they are also modifying their services to help fintech companies prosper.
4. There is a More Widespread Use of Cryptocurrency
Cryptocurrencies used to be looked upon with skepticism and even distrust. While we can’t say that digital currency has replaced traditional currency, we can safely conclude that it is gaining widespread acceptance — more people are beginning to entrust their money to decentralized apps.
As you plan to make a fintech startup, simultaneously plan to create an app that is very cryptocurrency compliant. While it will be impossible to build a fintech company that can compete with industry behemoths like Binance or Coinbase, you can develop a company that will offer profound solutions to your target audience.
5. Insurtech is Becoming Increasingly Popular
Insurtech is a financial technology innovation that processes an individual’s medical and criminal records, social media information, credit history, and other relevant information using artificial intelligence whenever legally acceptable.
Companies rely on the information provided by insurtech applications to aid them in the recruitment process and suggest the most customized products to their customers. Because of its data-driven capabilities and widespread application, insurtech has become very popular in many sectors. Perhaps you should focus on insurtech in your bid to create a fintech company.
Fintech has revolutionized the financial industry. By employing innovative technology and data-driven applications, fintech companies have empowered consumers to manage their money, invest in business opportunities and even trade the digital currency markets. But these are not all. The possibilities are endless. As a result, you should start a fintech startup — yours could be the next big thing!
To progress on your journey to make a fintech company, the first thing you should learn is how to create a fintech startup. Follow the Epam Anywhere Business website link to receive detailed information on how to start a fintech company and build a fintech startup that will take the financial world by storm. If you have the resources to kickstart, start your journey today!