The fintech industry is booming — and your tech company needs to stay on the cutting edge to succeed.
As of 2023, there are approximately 30,000 fintech startups worldwide — up from 12,000 startups in 2019. That’s nearly triple within 5 years!
Around 90% of venture capital deals in fintech from 2010-2021 were for startup and early-stage companies. From 2020-2021 alone, global venture capital investment in fintech companies tripled, surpassing $131.5 billion USD.
As a fintech product manager or project manager, you must ensure your company has a top-notch fintech product that can thrive in the rapidly expanding fintech market. Doing so requires harnessing the most current IT developments in your tech stack.
A good tech stack is crucial for determining your fintech product’s functionality, scalability, and data security.
Understanding Fintech Stacks
A technology stack is the collection of technologies needed to create and run a program, such as a mobile application.
What are the layers of a fintech stack? A fintech stack consists of these front-end and back-end technologies: a user interface, programming languages, web frameworks, database, operating system, and the hardware/network. These create the technology stack or workflow.
What is the difference between fintech and financial services? Financial technology is the vehicle for providing financial services. These digital tools allow financial institutions to automate and streamline their operations. Some fintech solutions are even replacing traditional banks — especially concerning ecological sustainability.
Fintech companies use tech stacks including, frameworks, programming languages, databases, and client-side tools. Here’s a look at the most popular options for each layer.
1. Frameworks
A frameworkstreamlines the development process when creating a digital product such as a mobile app. They serve as the system for building software applications, offering pre-made components and improved interrelations.
For example, fintech apps frequently use Ruby on Rails, Spring, or Django as their framework.
Ruby on Rails
This full-stack, server-side framework is trendy among fintech startups. Rails has everything new companies need to fast-track application development, such as crucial default structures.
RoR uses a model-view-controller (MVC) architecture with the Rubyprogramming language, so it’s approachable and efficient for beginners. In current use cases, Ruby on Rails is the #1 framework for startups.
Spring
Spring Framework is a Java platform. Developers use this secure, efficient, and affordable application framework when developing Java applications.
This lightweight framework is excellent for fintech startups because it is flexible and offers much support. Spring is especially apt for crafting authentication and authorization functions.
Django
This free, open-source framework is suitable for large-scale fintech projects because it breaks the work into modules. As a Python-based framework, Django is suitable for fintech stacks that create database-oriented websites where security and easy maintenance are vital.
It uses a model-view-template (MVT) architecture. When companies like Robinhood, a cryptocurrency and online wallet, use Django, you know you can trust it.
2. Programming Languages
Software engineers using fintech stacks must think carefully about the programming language their digital applications will use. Your product will handle private financial information, so your coding language must provide a secure platform for financial data.
The most popular programming languages in fintech (starting with the most common) are Python, Java, C++, Ruby, and C#. Here’s why.
Python
The most prevalent programming language in fintech is Python, exceeding all other languages by at least 50%. Python is widely popular in the financial industry for being easy to learn and code. Python also has an extensive selection of open-source libraries and customization tools.
Many people use Python in tandem with the Django framework for risk management and pricing.
Java
Java is the second-most popular fintech programming language. Which has been the go-to language in the financial and e-commerce industry for years. Its cross-platform capabilities, tight security, and general-purpose design have made it a favorite among fintech companies that work with banks.
C++
The longevity and speediness of C++ as a compiled language appeal to RPA developers in the financial tech industry. Machine learning and artificial intelligence-driven fintech prefer C++ for its easy translation to machine language.
Ruby
With the popularity of Ruby on Rails across fintech, it’s no surprise that Ruby is a popular programming language. Its built-in security features and scalability make it the preferred language for digital payments, asset management solutions, and banking applications. Ruby is great for creating a minimum-viable product when developing an app.
C#
This object-oriented language is a vital tool for fintech software developers who create applications that run in the Microsoft .NET ecosystem. It’s more common in web apps and front-ends than in back-end software development. Although an ecosystem like Microsoft uses C#, it is much less popular in fintech stacks than C++.
3. Databases
Why is your chosen database essential for fintech solutions? Security is crucial when your application involves confidential financial details like credit card information.
The financial industry thrives on big data, so fintech needs a fast and accurate transactional database that supports digital activity logs, forecasting, error identification, and data sharing via API.
Plus, customers expect real-time data and constant availability. Convenience and reliability are essential for a well-organized system to yield positive customer experiences.
MySQL
MySQL is popular in fintech stacks because it’s affordable, accessible, simple, and fast. This relational database management system offers cross-platform functionality and is good at managing memory, using MyISAM as its storage engine. Being open-source, MySQL is cost-effective and has low risk management.
PostgreSQL
PostgreSQL has many fans in fintech. While it doesn’t scale as well as MySQL, it’s more advanced and can harden your database against breaches.
PostgreSQL is better for complex data sets. It has a high number of records without suffering from slowdowns. It also contains intricate algorithms, data masking, and transparent data encryption that easily help you meet regulatory standards.
MongoDB
This document-oriented database replaces relational databases in many core baking infrastructures, making it a trendy choice in fintech. NoSQL databases like MongoDB take an eventual consistency approach that’s dicey in accuracy-driven financial service.
Still, its fast performance and flexible schema model make it a worthwhile consideration for your fintech stack.
4. Client-Side
Successful fintech applications also need to provide a satisfying user experience. That’s why client-side programming languages matter.
Front-end functionality may not seem as necessary for your product development team, but you shouldn’t neglect your program’s outward development needs. Most fintech startups stick with these 3 popular languages.
HTML
HyperText Markup Language is the granddaddy of front-end technology and remains the most popular by far — including in fintech stacks. It provides the skeleton for most fintech products’ front end, resulting in a familiar and reliable user experience.
CSS
Cascading Style Sheet works with HTML to dictate the visual elements’ appearance. CSS offers a broad spectrum of graphic possibilities to help even basic fintech applications stand out.
JavaScript
JavaScript is the most beloved front-end tool for top-tier UI and UX. You can build practically all front-end features in JavaScript and deploy them swiftly.
Fintech developers love that you can build and add future elements without a massive overhaul or client-side disruption. Javascript is often used with Node.js in fintech stacks for faster, effortless development.
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Consumers worldwide increasingly prefer fintech solutions over traditional banks. Sectors of capital management, mobile payment systems and wallets, peer-to-peer lending, wealth management, and other service providers provide better scalabity over time.
The global fintech market is worth over $200 billion USD, and experts predict that it will double by 2028.
Is your fintech business equipped to give consumers a top-notch product that can compete in this crowded market? The industry is quickly finding that there’s not enough talent.
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