FinTech Software

Procuring bespoke IT solution for FinTech

IT Team

Assembling in-house or outsourced IT team

Integrations

Facilitating and supervising integrations

Newcomers to the financial sector are reshaping financial landscape with the help of the robust and scalable FinTech software solutions. While the digital innovation in financial services is not new, its growth became exponential in recent years. However, the innovation takes place far behind the frontlines of FinTech, specifically at the backend of what users see. FinTech itself is about technology-driven innovation in financial services improving different aspects of daily operations- including lending, borrowing, investing, as well as payments, retail banking, or any other part of day-to-day financial services management. The scalable FinTech software is one of the main advantages that start-ups have vis-á-vis already established market players. Therefore, in order for whichever FinTech business to prosper, it must be underlined by technology which can optimise processes, increase efficiency and speed of financial services, and automate manual and resource intensive activities. 

PSP Lab can assist you with choosing the best FinTech software which would allow creating a scalable solution for your business. Notably, there is no stand-alone solution and even the prominent market players in the FinTech sector are employing various software providers. From practical experience, we know which FinTech software is suitable for different types of services and compatibility of different providers. We can help you to create the infrastructure that would be suitable price-wise, functional, easy for integrations, and scalable.

What are the types of FinTech software solutions?

Most EU FinTech companies operate in the area of payments and alternative finance: there are more than 200 FinTech and over 150 FinTech companies operating in the payments and alternative finance sector respectively. When looking at it globally, there are more than 7,000 FinTech companies in a variety of segments. In order to enable operation in either of these segments, you must have a solid foundation as a FinTech software. It can be either custom-tailored by a team of dedicated professionals, developed via the outsourced team, or obtained at once as a ready-made solution. PSP Lab can help you in either way, by managing the process with an external provider or even recruiting a team of professionals. Thanks to many years of experience we know in practice what is required for the provision of a specific type of service. Below we will discuss each FinTech segment and which points must be addressed whenever choosing the underlying FinTech software solution.

FinTech-software-chart

Digital banking FinTech software

Digital banks are non-conventional providers of accessible financial services. The products offered by them include debit and pre-paid cards together with different financial management tools that help with saving money, managing expenses and scheduling payments. This segment is not a stand-alone business and it must allow connecting with different financial institutions using a variety of information exchange systems (e.g. SWIFT, EBICS, CIPS, etc.). Digital banks are usually created by FinTech companies that do not have a banking license (such as Payment Institutions or E-money Institutions) and rely on existing banks for carrying out their operations. They use digital channels to reach their customers and they challenge the business models of traditional banks. Banking FinTech software must allow having different modules which would enhance the customer experience and scale the operations. For instance, it can concern internal communication channels that allow offering a truly unforgettable experience or additional functionality of offering escrow services in one place. As such, whenever looking for a core banking FinTech software provider it is essential to consider the variety of internal capabilities that would enhance the user experience and ease the work of the operator.

Considerations about banking FinTech software

As a bare minimum it should address the following points:

  • Accounting Reporting
  • ACH Check Transactions
  • Customer Profile Management
  • Compliance Tracking
  • Currency Exchange
  • Fraud Prevention
  • Internal Communication Channels
  • Mobile Payments
  • Online Payments
  • Online Banking
  • Payment Processing Services Integration
  • Payment Card Support
  • Receipt Printing
  • Recurring Billing
  • Risk Management
  • Signature Capture
  • Transaction Monitoring
  • Two-factor Authentication

Payments FinTech software

A payment system refers to any system through which monetary value is shifted between parties to carry out transactions. This segment encompasses e-commerce payments, point of sale (POS) payments, billing automation, remittances, P2P payments. In order to operate a successful FinTech payments business, there is a prerequisite to chose a scalable FinTech software that would allow flawless and prompt integrations with a variety of counterparties. When speaking about a payment gateway software, it is important to consider how customisable and accessible it is. The gateway can be either a white-label or specifically developed.

Considerations about payments FinTech software

In whichever case it should consider the following points:

  • Buyer authentication
  • Fraud prevention
  • Invoicing
  • Multi-currency
  • PCI compliance
  • Processes multiple types of credit and debit cards
  • Processes ACH Payments and eChecks
  • Payment analytics and reporting
  • POS system
  • Recurring subscriptions and billing
  • Secure payment processing
  • Storage of customer information
  • Third-party integrations

Alternative finance FinTech software

Retail banks have significantly limited access to traditional bank-intermediated lending because of the underlying financial crises and regulatory pressure. This gave the Fintech players the opportunity to enter the financial market and to provide alternative finance methods more cheaply and efficiently than incumbents. The alternative finance comprises different types of procuring funding and can be recognised as follows:

  1. P2P Lending: companies which use online platforms underlined by FinTech software to connect borrowers with lenders;
  2. Crowdfunding: companies which facilitate collection of funds with the help of FinTech software from a group of people to finance various types of projects;
  3. Direct Lending: companies which are engaged in the provision of direct funding via FinTech software-enabled platform without the employment of official financial institution as an intermediary.

Whenever choosing suitable FinTech software for establishing business providing alternative finance it is essential to consider functionality which it offers in terms of customer management.

Considerations about alternative finance FinTech software

At least, the following points must be taken into account in whichever case:

  • Accounting Management
  • Amortization Schedule
  • Auto Loans
  • Automatic Funds Distribution
  • Asset Management
  • Audit Trail
  • Borrower Management
  • Collateral Tracking
  • Collections Management
  • Compliance Management
  • Complex Debt Structures
  • Dashboard
  • Document Management
  • Exposure Management
  • Investor Management
  • Loan Processing
  • Lead Management
  • Pipeline Management
  • Risk Management
  • Trend Analysis

RegTech software

Manual processes and inefficient technological infrastructure in regulatory compliance matters cause substantial expenses and are major cost drivers across all compliance areas. RegTech (Regulatory Technologies) is aimed at reducing and simplifying internal processes whilst enhancing the compliance matters of the financial institutions. The innovation which is left without oversight and developments from a regulatory compliance perspective would be inefficient whenever developing FinTech business. Therefore, apart from obtaining core FinTech software for the provision of services, it is essential to consider what RegTech solutions can be implemented. The RegTech software which will need to be procured differentiates in accordance with the segment in which your company is conducting business. Broadly speaking there are four different RegTech categories:

  1. Regulatory Reporting: enables automated data distribution and regulatory reporting through big data analytics, real-time reporting and cloud computing.
  2. Risk Management: detects compliance and regulatory risks, assess risk exposure and anticipates future threats.
  3. Identity Management and Control: facilitates counterparty due diligence (CDD) and know your customer (KYC) procedures. Performs sanction, politically exposed person and adverse media checks.
  4. Transaction Monitoring: encompasses solutions for real-time transaction monitoring and auditing with customisable rules for particular clients/situations.

Considerations about regulatory reporting FinTech software

At least, the following points must be taken into account in whichever case:

  • Audit Trail
  • Balance Sheet
  • Budgeting/Forecasting
  • Cash Management
  • Consolidation/Roll-Up
  • Data Source Connections
  • Data Import/Export
  • General Ledger
  • Profit/Loss Statement
  • Customisable Dashboard
  • Key Performance Indicators
  • Predictive Analytics
  • Qualitative Analysis
  • Quantitative Analysis
  • Scorecarding
  • Strategic Planning
  • Report Scheduling

Considerations about risk management FinTech software

At least, the following points must be taken into account in whichever case:

  • Alerts/Notifications
  • Auditing
  • Business Process Control
  • Compliance Management
  • Corrective Actions (CAPA)
  • Exceptions Management
  • IT Risk Management
  • Internal Controls Management
  • Liquidity Risk Management
  • Legal Risk Management
  • Mobile Access
  • Operational Risk Management
  • Predictive Analytics
  • Reputational Risk Management
  • Response Management
  • Risk Assessment

Considerations about identity management FinTech software

At least, the following points must be taken into account in whichever case:

  • Behavioural Analytics
  • Case Management
  • Compliance Reporting
  • Identity Verification
  • Adverse Media Tracking
  • Investigation Management
  • PEP/Sanctions Screening
  • Risk Assessment
  • SARs Management
  • Watch List

Considerations about transaction monitoring FinTech software

At least, the following points must be taken into account in whichever case:

  • Alert Management
  • Behavioral Analytics
  • Case Management
  • Compliance Reporting
  • Customisable Rules
  • Investigation Management
  • Red Flag Database
  • Risk Assessment
  • STRs
  • Transaction Monitoring
  • Transcription

InsurTech software

The global insurance industry is a complex business that has large capital requirements and is strictly regulated. Each time when there was a major development in the economy the industry was following the suit. Each time there has been a major leap in technology, the industry has responded with new products, new methods of distribution and new ways to evaluate risk. The most current revolution is InsurTech (Insurance Technology), which refers to the use of innovative technology in order to advance savings and efficiency in the conventional insurance industry. Same as with matters in other financial service segments, InsurTech is not a standalone business and new entrants are mostly benefiting from the collaboration with well-established market participants. The companies engaged in this sector are offering additional securitisation, and faster and more lenient progressive services to their customers. It is reached with the automation in risk scoring and employment of solutions that help to ease the underwriting process. The InsurTech itself can be divided into the following subsectors:

  1. Reinsurance: companies that offer reinsurance with the help of FinTech software;
  2. P2P: companies that via FinTech software solutions bring together various parties with the aim of diversifying and mutualising common risks;
  3. Underwriting: companies that offer FinTech software solutions for helping insurers to improve profitability through accurate and consistent underwriting decisions.

Companies that are engaged in the provision of insurance services with the help of innovative InsurTech software must manage huge amounts of data. Whether it is reinsurance or P2P insurance the identification of risks must be at the core of the software. Furthermore, new technologies that InsurTechs use such as IoT, advanced analytics and machine learning bring more choices to consumers at lower prices. Hence, in this sector, the competitiveness of the product offered in terms of technological advancements is essential.

Considerations about insurance FinTech software

At least, the following points must be taken into account in whichever case:

  • Broker / Agent Portal
  • Billing & Invoicing
  • Claims Management
  • Commission Management
  • Contact Management
  • Customer Portal
  • Document Management
  • Insurance Policy Management
  • Insurance Rating
  • Life & Health
  • Property & Casualty
  • Quote Management
  • Reinsurance Administration
  • Risk Assessment
  • Underwriting Management

Personal Finance & Wealth Management

Personal finance is an activity that includes all the financial decisions on budgeting, savings, insurance, and mortgages. It goes hand in hand with other services provided in the financial industry and acts as a complimentary service. Personal finance and wealth management helps customers to make the right decisions by combining information accounting for a range of financial products and personal features. The most current innovation in the sphere of personal finance is known as WealthTech. WealthTech is automating procedures, using artificial intelligence to provide deeper analytical insights, customising experiences and advice with digital personalisation to reach the aims of personal finance. The most prominent types of personal finance in the FinTech sector are the following:

  1. Personal financial management: companies that employ FinTech software to assist customers to manage their bills, accounts or credits as well as manage their personal assets and investments;
  2. Robo-advisors: automated services employing FinTech software that makes use of algorithms to provide customers with advice based on the available data;
  3. Social trading: also referred to as “copy trading” platforms organised via FinTech software that allows novice traders to mimic the strategies of more experienced investors.

Considerations about personal finance and wealth management FinTech software

At least, the following points must be taken into account in whichever case:

  • Accounting Management
  • Budgeting & Forecasting
  • Consolidation / Roll-Up
  • Currency Management
  • Client Management
  • Client Portal
  • Compliance Reporting
  • Data Import/Export
  • Fund Management
  • Financial Reporting
  • Investment Management
  • Modelling & Simulation
  • Performance Metrics
  • Portfolio Rebalancing
  • Project Management
  • Risk Management
  • Revenue Recognition
  • Tax Management

How PSP Lab can help to procure the most suitable FinTech software?

PSP Lab knows what you need to expect from the FinTech software and we can advise you on the vendors or help with the development of your bespoke solution. We can ease the negotiation process and facilitate the establishment of a robust and scalable FinTech software foundation. Furthermore, as is seen from the above, whichever FinTech segment is not a stand-alone solution, specifically, in terms of software. PSP Lab knows IT providers and capabilities for cross-integration of their FinTech software. We may help you to establish a solid foundation by assembling together the best market solutions in one go, without the need of procuring customary integrations.

Speak to us today to learn how you can improve and scale your business.

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