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The Data Scientist

Digital banking

Why has the rapid development of digital banking changed the financial services industry as a whole?

The fintech industry has undergone enormous changes in recent years. These changes are positive, as they affect the comfort, confidentiality, and security of customers. With the rapid development of digital banking, new technologies, effective business solutions, and business models, the way money is managed and access to financial services has changed dramatically.

What is the key essence of all these changes? Traditional banks are actively competing with agile fintech startups that use all available digital tools, this allows them to offer faster, more personalized, and often cheaper financial products and services. A key element of the effectiveness and success of these fintech innovations is the development of reliable software solutions specifically designed to meet the changing needs of customers.

MVP development by DeepIspire provides a comprehensive opportunity to test and improve the development, and successfully enter the fintech market. You save resources, stay ahead of your competitors, meet customer needs, and increase your current profit level. The main task of MVP (minimum viable product) is to reduce costs and prevent unnecessary spending of both time and resources on creating an ineffective fintech solution. MVP is not a finished product made in a hurry. It is a full-fledged development, with a basic concept and key functions, which allows you to verify the effectiveness of the chosen direction and receive user feedback. By implementing MVP solutions in the fintech industry, you immediately receive real consumer feedback and can improve the product at the development stage, reducing the likelihood of critical errors that affect the efficiency of your software tool.

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Why is the traditional way of attracting customers in the financial services market not enough?

Fintech is one of the leading industries in terms of the speed of change and digitization of processes. Three factors influence the development of Fintech:

  • The format of customer service is changing from traditional to hybrid and remote: the client needs to visit a bank branch less and less, and most of the available banking products can be obtained in the application and on the bank’s website;
  • Banks are constantly launching new products on the market and rapidly improving existing ones. They are forced to do this by competition: the cost and quality of banking services have converged, so financial institutions must look for new ways to actively attract new and retain existing customers;
  • A separate element is the development of non-banking products. Large banks are building their ecosystems in media, transport, telecommunications, and other service areas.

Competition and the pace of development of the financial technology market increase the need to create digital products, so banks are increasingly using the approach of developing effective software solutions.

What is the importance of developing an MVP in digital banking?

For many fintech companies, the comprehensive development of a minimum viable product (MVP) is often the first important step in improving operational efficiency. MVP development from DeepIspire can help fintech startups quickly bring to market a functional product that meets the basic needs and expectations of customers, even if the digital product does not have full functionality. The MVP approach allows fintech startups to test their key ideas, collect valuable feedback from users, and add new important functionality to improve the product. This agile development process helps minimize risk, save time, and ensure that the final product meets customer expectations.

The Role of a Business Analyst in Software Development

The role of business analysts in software development is crucial, as they bridge the gap between stakeholders’ needs and the technical team’s ability to deliver a functional, efficient product. In the fintech industry, the role of a business analyst in software development is indispensable. Business analysts play a critical role in bridging the gap between business goals and technical implementation. In the case of digital banking, business analysts help define the product vision, gather and prioritize key customer requirements, and ensure that the final software solution meets current user needs and applicable regulatory requirements.

Business analysts work with stakeholders, including product managers, developers, and customers, to define and document functional and non-functional software requirements. They conduct market research and study customer problems, preferences, and industry trends, ensuring that the product development process is based on real data. This allows for the development of software solutions that are not only innovative but also practical and as user-centric as possible. Business analysts help manage the entire software development lifecycle, from ideation to post-launch monitoring and optimization.

Technologies used in digital banking

The success and efficiency of digital banking depend on a variety of technologies that ensure seamless and secure financial transactions. Let’s take a look at some of the key technologies that enable the opportunities that digital banking offers its customers:

  • Blockchain plays a vital role in increasing transparency, security, and efficiency in digital banking systems. Blockchain allows for the creation of decentralized, tamper-proof transaction records that can be accessed in real time. This technology is particularly useful for enhancing the security of digital banking platforms and enabling faster cross-border payments;
  • Artificial intelligence and machine learning, these key, innovative technologies are increasingly being integrated into digital banking systems to offer personalized financial services, detect fraud, and significantly optimize operational efficiency. Many digital banks are now using AI-powered chatbots to quickly and thoroughly process customer queries, provide instant support, and improve customer experience. ML algorithms help predict current customer behavior, allowing banks to offer personalized recommendations;
  • Cloud computing allows digital banks to scale their banking operations quickly and cost-effectively. By hosting their platforms in the cloud, banks can ensure better data availability, security, and performance while reducing infrastructure costs. Cloud systems provide greater flexibility, allowing digital banks to quickly adapt to changing changes in the banking market;
  • Biometric authentication, including facial recognition and fingerprint scanning, has become a standard feature of many digital banking applications. Biometric authentication technology enhances current security by ensuring that only authorized users can access their accounts, reducing the risk of fraud and identity theft;
  • Open banking allows fintech companies to create innovative applications that interact with bank accounts, facilitating services such as budgeting tools, investment platforms, and payment gateways.

In summary, all of the above technologies continue to evolve, and we can expect to see even more sophisticated and convenient financial products and services. The integration of artificial intelligence, blockchain, and other emerging technologies will allow digital banks to offer customers a personalized experience. The rapid development of digital wallets, mobile payments, and embedded finance will change the way consumers interact with their finances. For example, embedded finance involves integrating financial services directly into non-financial platforms, such as e-commerce sites. By heavily involving business analysts in software development and leveraging cutting-edge technologies, fintech companies can introduce and actively promote innovations in this area. This allows them to provide more efficient, secure, and customer-centric financial solutions.