Startups come in all shapes and sizes, but some of the most successful ones are those that serve a specific niche or industry need. If you’re considering starting your own business, the innovative FinTech startup ideas are an excellent niche to explore. The FinTech industry continues to increase and presents plenty of opportunities for future startups to get ahead of the competition.
As per Market Data Forecast, the FinTech market is to cross a whopping $324 Billion in 2026. Moreover, the FinTech industry holds a double-digit CAGR of 25.18% from 2022 to 2027.
With the rise of big data and the widespread adoption of social media, FinTech startups are gaining momentum in Silicon Valley and worldwide. Despite this surge in new FinTech ideas, there is still plenty of room to explore.
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Latest Trends in FinTech Industry
With the rapid development of technologies like artificial intelligence, cloud computing, and the internet of things, we will soon be experiencing a true internet-of-everything era. Blockchain is also changing how we interact with different devices – from machines to other objects.
We will soon see all sorts of devices connected through this distributed ledger system. Moreover, consumers demand high data privacy – they want control over what they share online and how they share it. So, there are always new opportunities for startups to explore.
Following are the top FinTech trends to watch out:
- Decentralized Finance (DeFi): It provides users access to services available on decentralized applications (dApps) such as Ethereum and EOS. DeFi was one of the biggest FinTech trends in 2022. A popular DeFi dApp is MakerDAO which provides financial leverage in the cryptocurrency market and hedging capabilities.
- Artificial Intelligence: In banking, AI has helped create a more accessible customer experience, faster-automated systems, and better security. However, this is not without its challenges where people are concerned about the ethics of using AI. The AI Fintech market is to cross $41.16 billion by 2030.
- Blockchain Technology: Blockchain is to offer a secure way of transactions. Travelers can book their flights or hotels on a platform without needing payment information like credit card details, social security numbers, etc. Furthermore, blockchain also has implications outside FinTech–it could potentially change healthcare, legal industries, and much more. Ethereum is one of the popular blockchain-based Fintech developments.
- IoT: The FinTech industry is witnessing more significant impacts of IoT in providing cost-effective user experiences while collecting relevant data simultaneously. A recent trend is Industrial IoT, where complex manufacturing processes are augmented with automation and sensors. There are many vital developments in cybersecurity for IoT, making it an essential topic for businesses today.
- Voice Payments: Voice payments have been prevalent since Apple Pay was launched in 2014, this type of payment is not yet accepted everywhere. Voice payments will become a significant part of our everyday lives sooner than we can imagine.
- Mobile Wallets: They have increased in popularity because they make paying more manageable. Users can pay by tapping their phone against a sensor at checkout instead of swiping their card or handing their cash over to the cashier. Mobile wallet development has a range of uses and leads to easy accessibility, timely payments, lower conflicts, etc.
- Robo-Advisors: Robo-advisors are digital financial advisors who offer automated investment solutions with minimal human intervention. Some users prefer Robo-advisor services because they have low fees and have access to world-class investors’ advice. Additionally, these services do not require extensive paperwork, can be easily accessible from any location, and offer instant access to your funds without waiting on transfers from one bank account to another.
The FinTech industry has become a viable source of wealth for entrepreneurs and businessmen worldwide. Its massive popularity among the typical audience has led to stiff competition worldwide.
The following infographics give a hint of worldwide FinTech users by segment.
With FinTech startup ideas, you can be on your way to starting your own business in no time!
Here are the Top 10 Fintech Startup Ideas for you
1. Online Lending Apps
If you’re looking into starting an online lending app, you must understand how this type of business works before jumping in head first. When it comes to online lending, there are a few things you should consider.
- What is the interest rate?
- Minimum credit score required
- What are the terms of the loan?
- Late payment fee
- How many money users can you borrow?
- Repayment schedule
All these aspects must be clear to create a successful online lending app. Lending Apps typically cater to borrowers with low-interest rates and good credit scores who have no other option to get approved for loans from traditional lenders. These borrowers may also not have access to credit cards or bank accounts, making borrowing difficult in some cases.
The minimum amount app users could borrow would depend on their income & expenses. However, it typically is around a few thousand dollars & at an interest rate of 5% or above. Upgrade and Sofi are popular money-lending platforms in the U.S.
2. Peer-to-Peer Lending
Also known as social lending, this type of lending allows individuals to borrow and lend money without going through a financial institution. Loans are made through an online platform that matches lenders with borrowers. The global P2P market holds a CAGR of 29.7% from 2020 to 2027.
The benefit of peer-to-peer lending is that it can provide access to capital for borrowers who may not be able to get a loan from a bank. For lenders, the returns can be higher than what they would earn from a traditional savings account.
P2P lending apps must offer more security features like insurance, identity verification, credit checks, and emergency provisions. If you’re interested in starting your own P2P company, here are three top companies to consider: Zopa (United Kingdom), Lending Club (United States), and Prosper (United States).
Crowdfunding financing allows users to raise money from a large group of people, typically through an online platform. The global crowdfunding market stands at a CAGR of 16.81%. So, Crowdfunding platforms cater to startups who want to scale quickly and small businesses that need capital on demand. They allow startups to bypass traditional financial institutions by funding themselves by offering shares in their company or other incentives (such as rewards) in exchange for investments.
Moreover, businesses can test the market and create awareness before launching their products, making customers easily accessible. It also allows backers to be involved with the project or product development process and share in its success at a much earlier stage than they would have had access to otherwise! There are many crowdfunding sites available now, but Kickstarter is one of the most popular crowdfunding sites.
4. Robo Advisor App
A Robo advisor is an app that provides automated, algorithm-based financial planning and investment advice. This type of startup is becoming increasingly popular as people look for ways to save time and money regarding their finances. Some benefits of a Robo advisor include 24/7 access, lower fees, and the ability to start with a small amount of money.
A Robo advisor app is a great option when exploring top fintech startup ideas with worldwide reach. Popular RoboAdvisor platforms like Wealthfront offer interactive tools like blogs, videos, and calculators to provide personalized financial guidance tailored to your goals. Users can even chat live with a personal finance expert through the platform’s website or mobile app!
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5. Payment Processors
A payment processor is an enterprise that provides the technology and infrastructure needed to accept and process electronic payments. Payment processors typically work with banks and merchant account providers to offer their services to businesses. If you’re looking for fantastic FinTech startup ideas, consider starting a payment processing platform.
Few things you’ll need to get started:
- A sound business plan – You should know how to market your service, your target market, your customer acquisition costs per customer received, and your customer lifetime value.
- Financial resources – You may need access to capital to purchase necessary equipment or hire key personnel.
- Hosting – With all this information, you’ll need somewhere to store your data. Hosting can run into several hundred dollars each month so if you don’t already own some hosting space through another company, make sure to factor this into your budget!
- Marketing strategy – Once people learn about your service, they need to know where to go and how to sign up for it!
Worldwide popular payment processor platforms include PayPal, Stripe, etc.
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6. InsurTech Platforms
InsurTech is one of the most popular FinTech startup ideas right now. And it’s no wonder why- the industry is ripe for disruption with a CAGR of a whopping 51.7% from 2022 to 2030. You can tap into a proliferating market by creating a platform that helps people compare and purchase insurance policies. Plus, with the help of data and analytics, you can create a truly personalized experience for your customers.
Insurtech platform provides users an easy way to get quotes from multiple companies quickly and efficiently while providing access to more features such as Travel Insurance, Health Insurance, Homeowners Insurance, etc.
The startup idea provides an interactive interface where users can easily find their desired product by filtering their needs (location, duration). As well as provide accurate time advice about best choices through tutorials or videos. A quick list of other startups already innovating in this space: Oscar Health, Gusto, etc.
7. Digital Wallets
A digital wallet software allows users to store, send, and receive digital currency. You can also use them to store other kinds of information, such as loyalty points or gift cards. Some digital wallets are designed for a specific cryptocurrency, while others can be used with multiple currencies. Digital Wallets crossed the 100 billion mark in 2020 and have an impressive CAGR of 20% from 2020 to 2027.
They are potent Fintech startup ideas that promise huge growth rates. The implementation is easy and secure. Wallets help people save time by eliminating the need to carry cash. It’s just one more way to become convenient!
8. Cryptocurrency Trading Apps
If you’re looking to get involved in FinTech, launching a cryptocurrency trading app could be a great option. Cryptocurrency trends show no signs of slowing down. On the downside, due to their volatile nature, cryptocurrencies can be subject to large swings in value.
Cryptocurrency trading platforms must have an intuitive interface as they are used by a more extensive section of people who may not know about trading. They should provide advanced charting with good technical indicators, which will help traders make better decisions and take advantage of market trends.
Moreover, traders should be able to place stop losses and take profit orders for all trades made through the platform. Finally, customer support should also be available 24/7 so traders know they can reach someone anytime during the day if there are any problems with their account or funds. Coinbase is one of the most popular cryptocurrency exchange platforms in the U.S.
9. Online Banking
Though online banking has been around for a while, there’s still room for fintech startups to innovate digital transformation in banking. For example, you could develop a mobile app that helps users manage their finances on the go or create a digital-only bank that offers competitive interest rates. You could also establish financial planning software that helps people save for their future.
Online banking platforms are available everywhere and are becoming more popular every day. With so many options already out, making your product stand out from the crowd can be challenging. But by developing new features or targeting a specific demographic (such as millennials), you can carve out your niche market and set yourself up for success.
10. Chatbots-based Fintech Platforms
Chatbots are computer programs that can mimic human conversation. Notably, they are fruitful in helping with your finances by providing budgeting advice, investment tips, and more. Chatbots in banking lead to quicker transactions and lower fees.
Mobile apps like Chase Pay allows customers to pay for goods or services directly from their phone without needing a credit card or cash. If banks don’t invest in these technologies soon, they may be left behind as competitors get ahead!
Must-Have Security Features of FinTech for latest Startup Ideas
So, that was all about the top FinTech startup ideas. Focussing on the security aspects of FinTech ideas is critical as application users regularly share personal information, including bank details & credit card information. You don’t want your user data landing in some hacker’s hands.
The top security aspects of FinTech app development:
- Enforce complex passwords: One of the easiest ways for hackers to access an app is by brute-forcing user accounts. With complex passwords and a good authentication process, you can prevent anyone from trying multiple account combinations until they get it right. Password managers help generate strong passwords across devices while storing them safely.
- Leverage two-factor authentication: Adding another layer of protection ensures that even if someone has the password, they will fail to access the account without another set of credentials. Automatic logout or lock after every session helps reduce the chances of session hijacking or shoulder-surfing when logged into your account.
- Retina scan and facial recognition software: Another valuable feature to include in your app is retina scan and facial recognition software. These tools can verify user identity automatically through biometric techniques. Even if someone else knows the person’s password, they won’t be able to use the app because their face will not match up with what’s stored on the system.
- OTPs: An additional way to protect your app is by using one-time passwords (OTPs). OTPs are generated each time there is a login attempt and expire after usage. Hackers can’t reuse this type of password, so it becomes useless once it expires.
- Data Encryption: This is a means of encoding or scrambling data so only authorized users can read it. If your app deals with confidential information, you’ll need to use encryption techniques.
- Define user role and authority check: The next aspect of security to consider is defining user roles and authorities within the app. You need to know who should have access to which features or parts of the app. For example, should administrative privileges go only to administrators? Is there any reason why clients should have administrator privileges?
When it comes to fintech startups, one of the most important things you can do is a partner with a leading app development company. This will give you access to the latest technology and trends in the industry and help you create a cutting-edge product that meets the needs of your target market.
Reading case studies of web app development can help you analyze whether the chosen company will bring massive success to your project or not. The best way to learn about the company’s background is to look at its previous projects and customer testimonials.
We at PixelCrayons take pride in our superior customer service and creative design abilities. That’s why we’ve made building high-quality apps easy, fun, and accessible to everyone!