More and more companies are looking for FinTech software outsourcing providers nowadays. In this article, I will share few reasons why it’s important for banks and other financial institution to innovate with financial software development outsourcing providers.
Persuing disruptions in FinTech industry
FinTech startups are appearing everywhere every day. Large banks and financial institutions might start to feel threatened. The institution size and the budget are not an unbeatable advantage anymore. With every new disruptive idea or technology that startups’ founders develop every day, the risk that big financial players will be quickly left behind grows more and more. Things like Blockchain, Mobile Banking, AI-supported trading, and investment are already changing banking and investment industry. So, if old players will not follow those trends, their customers will quickly move to new, safer, faster and more user-friendly solutions.
FinTech Software Outsourcing but why?
There are few reasons why banks and other financial companies may want to outsource their FinTech software development:
1. None wants to work at a bank!
Well, actually it’s not completely true. Some people really enjoy working at banks. But the question is if those are the people that banks need to develop new disruptive solutions?
What is the first thing that came to your mind when you think about working at a bank? Probably stability, safety, low pace and high salaries. Don’t get me wrong, those aspects of working at a bank or other financial institutions are important and valuable for many people. But do you think that this stable, safe and low-paced work environment empowers creativity? Do you think that this is an as good place for disruptive innovations as a fast-paced startup? A startup, where “innovate or not to innovate” equals “to be or not to be”?
FinTech companies need innovations now more than ever. So probably this is one of the reasons why they are searching for FinTech software outsourcing providers who have access to talented developers.
2. Corporate, financial institutions are not designed to support innovations
Corporates are not the best places for innovative ideas to be born. It doesn’t mean that it’s impossible to innovate at corporate structures, but it can be challenging. Big companies usually design their corporate culture in a way that supports sustaining the status quo. Therefore, it’s hard to implement some disruptive changes and came up with new innovative ideas in such environment. Changing the culture of such a big organization might be really hard, time-consuming and costly. The question is if those companies have the time that is needed to change? Companies that are buying innovative financial software development services are actually buying more time necessary for changing their own organization.
3. Know-how and new technologies
FinTech industry speeded up recently. Beside of being innovative, big financial companies are also struggling with being up to date with existing technologies. In this highly regulated, risky and complex industry development of new products takes a lot of time. Especially when small software bug or security issue can cause big financial losses. This is why it’s not easy to pivot and change the development to new technology, or strategy if currently used isn’t good enough anymore. New technologies, frameworks, and tools in IT are developed so fast that it might be challenging for banks to be up to date with newest solutions. This is why many companies are thinking about asking someone who specializes in specific (new) technologies to help them.
If you want to talk about financial software development or you got the innovative idea to create, drop me a line.