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FinTech is a disruptive force to be reckoned with. If numbers are to go by, investments of up to $2 billion have been made in this emerging sector last year. Some have proclaimed FinTech as an ‘imperative’ to stay relevant.
Amid all the rage, a key caveat, however, has been passed on: not all FinTech follows the same rule book, and that not all enterprises are ripe for the picking when it comes to transformation through FinTech software development.
FinTech, when done right, can:
- Unlock the pathways to agile, hyper-personalised customer experiences.
- Optimise productivity and drive better strategic decisions.
- Address needs and competition in better or lower cost ways.
- Provide maximum security against perpetrators of cybercrime.
- Lead enterprises to entirely new product segments and markets.
Not only can it transform companies’ revenue-generation models, but can also deeply impact customers’ lives. But only, as we said when done right!
This begs the following questions: how should enterprises approach FinTech to reap constant value from it? What should be the adoption and scale-up strategy to enable a long-lasting foundation for growth? And, how should enterprises check whether or not they are mature enough to make the shift to FinTech software solutions? This article attempts to answer these pressing questions and more.
Solving the Strategy Dilemma: How to Get Started with FinTech Software Development the Right Way?
The formula to find success with FinTech, like all innovation, starts with defining a focused and clear strategy. Financial institutions must weigh in operational and business aspects to build a strategy in place while accessing where they are right now and where they got to be.
Having said that, we must emphasise that having a strategy doesn’t necessarily mean you have the right strategy. In fact, a glut of strategies wouldn’t move beyond experimentation or be well-aligned to ongoing and upcoming disruptions. Being so, it’s necessary to help financial institutions move the needle where it matters and build a fully developed strategy for FinTech.
Leading Practices for Building a FinTech Strategy that Delivers
The scope of leveraging FinTech is ever-expansive. However, determining the right spots of opportunity is what controls success.
To build a FinTech strategy that aligns with overarching business objectives and drives growth, enterprises must consider multiple factors such as customer expectations, market volatilities, organisational culture, geographies in which they operate, and resources available to them. But what exact practices should they follow? Let’s know them in detail.
1. Assess the Current State of Affairs
By assessing the current state of business operations, we mean examining existing operations, determining key challenges and opportunities for change, and identifying potential roadblocks. This acts as a starting point for enterprises looking to augment and accelerate their FinTech transformation journey.
2. Identify Signals of Change
An important rule of thumb is to remain on top of signals of change. The financial industry is increasingly fickle and experiences strong headwinds of disruption almost every day. Time has come to do away with spreadsheets and act proactively rather than being forced to be reactive, it’s crucial that enterprises feel the pulse of the market, monitor the FinTech activities of their competitors, understand the likely time of change, and recognise implications.
3. Build a Vision
Companies with the right vision are poised to reap long-term business benefits and sustainably at that. For creating a FinTech strategy that doesn’t turn obsolete quickly, enterprises must harbour a vision of where they want to be in five or 10 years. This can be achieved by cultivating organisational characteristics most important for the resilience and lasting value.
4. Determine Readiness for Change
Any journey towards transformation is likely to fail if people within an organisation are resistant to change. To avoid so, companies must assess the appetite for change – of employees and the leadership. Leaders must understand barriers, tailor the change strategy to smoothen out differences, and encourage buy-in over time.
5. Foster Alignment
Leading a FinTech strategy to fruition requires a comprehensive understanding of where an enterprise is and where it wants to be in the future, the agents of change that may sweep the market, and the readiness for change. Only when financial institutions have clear answers can they build a targeted FinTech strategy that aligns with the overall business strategy and presents metrics for performance against it.
6. Focus on Double-Edged Evolution
FinTech is always evolving. To catch up with the volatile nature of it, enterprises must forge a strategy that not only favours incremental changes, but also provides impetus to innovation that takes their business forward. Missing out on any facet can lead to companies implementing changes incrementally but not aligning with long-term transformative change.
7. Prioritise Initiatives
Financial institutions can’t take on every FinTech opportunity in front of them. Prioritisation is necessary for companies to filter out use cases that are anticipated to render value. It can be done by evaluating a range of factors, including the feasibility of development, the size of the potential impact, and areas that aren’t big today but hold promise to make waves in the future.
8. Set Tone of Support at the Top
Given the range of challenges facing the financial industry, it’s easier for companies to go astray and focus on time-sensitive issues rather than outlining a roadmap for strategic jobs. The job of leadership, hence, is to keep it all together, dedicate resources to managing, monitoring, and measuring FinTech initiatives effectively, and sow the seeds of cooperation and trust.
Characteristics of Enterprises that Ace FinTech
- 1. Prioritise customers’ demands and challenges.
- 2. Enable innovation for the greater good.
- 3. Deliver with an outside-in approach, rather than the inside-out.
- 1. Forge internal and external relations to drive FinTech strategies.
- 2. Nurture mutual understanding, harmony, and trust.
- 3. Build a stronger and broader FinTech ecosystem.
- 1. Focus on metrics.
- 2. Create plans to measure the impact of FinTech initiatives.
- 3. Identify other measures to gauge the success of the FinTech strategy. This excludes the ROI since it takes time to trickle in.
- 1. Take bottom line decisions based on insights.
- 2. Create an adaptable strategy to boost FinTech innovation.
- 3. Bridge gaps by aligning solutions with enterprise-wide future needs.
- Agile and Adaptable:
- 1. Act proactively instead of reactively.
- 2. Swiftly change the course of actions to address evolving challenges.
- 3. Are disruptors, not creators.
- Long-Term and Short-Term Focused:
- 1. Reshape work through incremental changes and long-term transformations.
- 2. Respond to day-to-day challenges while planning ahead.
- 3. Ensure that incremental changes don’t go against the guiding principles of a FinTech strategy.
Suggest Me a Shortcut: The Alternate Method to Do the FinTech Right
It doesn’t take a genius to understand that most enterprises may find the task of creating a FinTech strategy pretty overwhelming. Lack of talent or resources could hold them back from progressing. However, partnering with a FinTech software development company such as Kellton Tech can come as a huge respite.
Kellton Tech is backed by years of cross-industry experience in delivering end-to-end FinTech software development services under the SaaS model and has helped a number of financial companies transform and win in the digital economy. We’re trusted for our proven approach to outsourced product development requirements and committed to meeting customers’ needs. By leveraging our dedicated innovation hub, our teams have designed and developed game-changing technologies for financial services – more particularly in the areas of security, data, artificial intelligence, and machine learning – to help financial services companies strengthen processes, drive efficiency, and revolutionise customer experiences.