Savvy Guide On Fintech App Development Cost Estimation
Fintech has transformed the financial services business into a multibillion-dollar industry in the process. This revolutionary technology has enabled financial institutions to provide new and creative services to their consumers, resulting in a sector that is growing at an exponential rate.
If you plan to develop a FinTech app for your business, now is the best time to do so. However, you may have concerns about the expenses involved in creating one. “How much does it cost to develop a fintech app?” – This is apparently the most sought-after question, but there’s no standard answer. The reason is that the cost is impacted by time and the developer’s rate, both of which depends on several factors.
In this article, we’ll break down the fintech app development cost by types: banking, lending, investment, insurance, and consumer finance.
1. Fintech market overview
As technology advances and the cost of developing a FinTech app decreases, the potential for future disruption in the Fintech sector is relatively large.
- Fintech businesses received $105.3 billion in investment in 2020. The largest corporations contribute to this expansion by attracting new investors and deploying technologically advanced solutions.
- By the end of 2025, the Global Fintech Market is anticipated to be worth $305 billion.
- The FinTech market is predicted to reach $699.50 billion by 2030.
Fintech is a thriving industry propelled by cutting-edge technologies such as APIs, artificial intelligence, and blockchains. The following are the main drivers of the global rise of fintech: Blockchain application; fintech enhancing financial data security; rising interest in digital payments.
2. Fintech app development cost by types
As stated earlier, the financial app development expenses vary depending on the type of application you want to design. The following are FinTech app development cost estimates for the most common app types: banking apps, lending apps, investing apps, personal finance apps, and insurance applications.
The cost of developing a banking app comprises the expenses for the admin panel and client-side features. As a user, you can check your account balance, view your transaction history, transfer money to other accounts, schedule payments, send P2P payments, and locate accessible ATMs using the client-side features. The admin panel is in place to manage user profiles and financial activities.
Below are some examples of popular banking apps:
- Chase Mobile (United States): Chase Mobile is the mobile banking app of JPMorgan Chase Bank. It allows users to manage their accounts, make transfers, deposit checks, pay bills, and access other banking services.
- Wells Fargo Mobile (United States): Wells Fargo Mobile is the mobile banking app of Wells Fargo Bank. It enables users to check account balances, transfer funds, pay bills, deposit checks, and perform other banking transactions.
- Bank of America Mobile Banking (United States): Bank of America Mobile Banking is the mobile app of Bank of America. It provides users with access to their accounts, allows them to transfer funds, pay bills, deposit checks, and access various other banking features.
- HSBC Mobile Banking (Multiple Countries): HSBC Mobile Banking is a widely used banking app available in several countries, including the United Kingdom, United States, Canada, Australia, and others. It offers a range of features, such as account management, transfers, bill payments, and more.
- Santander Mobile Banking (Multiple Countries): Santander Mobile Banking is a popular app offered by Santander Bank in various countries, including the United Kingdom, Spain, Brazil, and Mexico. Users can view account details, make transfers, pay bills, and perform other banking activities.
- Chime: Chime provides three separate accounts: spending, saving, and secure credit. There are many ways to save money, including round-up transactions, saving from every purchase, and using debit cards. Chime also features a fun SpotMe feature that lets you use a debit card to make payments that overrun your account limit without being charged an overdraft fee. The cap varies between $20 and $100.
- Revolut: Revolut focuses on international purchases. Without any additional fees, you may send money anywhere globally, buy gold and cryptocurrencies, and manage your finances with built-in data analysis.
- Barclays: The London-headquarter bank operates as two divisions, Barclays UK and Barclays International. Users are allowed two separate accounts for spending and saving without monthly service charges. The Barclays banking app also integrated built-in analysis for financial management.
Next, let’s look at how long and how much it will cost to create a banking application.
|Feature||Development time (in hours)|
|ATM & bank locator||90|
Through peer-to-peer lending apps, those who are willing to lend money can connect with those who need it. Such apps allow customers to borrow a small sum of money against their next payment, and you may build one while developing a DeFI app, for example.
The 3 examples of lending apps are:
LendingClub (United States): LendingClub is a peer-to-peer lending platform that connects borrowers and investors. It offers personal loans, business loans, and auto refinancing loans. LendingClub operates primarily in the United States.
Prosper (United States): Prosper is another peer-to-peer lending platform that provides personal loans to borrowers. It connects borrowers with individual investors. Prosper operates primarily in the United States.
Zopa (United Kingdom): Zopa is a peer-to-peer lending platform based in the United Kingdom. It offers personal loans and connects borrowers with individual investors. Zopa is one of the first and largest peer-to-peer lending platforms in the UK.
Kabbage (United States): Kabbage is an online lending platform that offers small business loans. It utilizes automated processes and algorithms to evaluate loan applications and provide quick access to funding. Kabbage primarily operates in the United States.
Funding Circle (Multiple Countries): Funding Circle is a peer-to-peer lending platform that specializes in small business loans. It operates in multiple countries, including the United States, United Kingdom, Germany, and the Netherlands.
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ZestFinance: ZestFinance is an AI-based lending app. It uses machine learning to collect data on people who have little or no credit history. Based on this information, the service determines how much money lenders will lend to individual consumers.
Dave: Dave gives consumers extra cash (up to $100) if they need money to meet an expense before the next payment. The business does not offer cash advances, but users must pay a monthly membership fee to use the app. In addition, to minimize overdraft penalties, consumers receive alerts when their balance falls below a certain threshold.
Brigit: This business provides cash advances (from $50 to $250), but customers must pay $9.99 a month for the Brigit Plus plan to gain access to “instant transfers” and other valuable services. Brigit features a budgeting tool that allows users to track their spending, as well as a “Brigit score” model that assesses three financial metrics: bank account health, spending behavior, and earnings profile.
Here is the time it takes to build the essential features of a lending app.
|Feature||Development time (in hours)|
Payment & billing
|Transaction & EMIs||75|
Insurance apps are designed to simplify interactions with insurance providers and help clients resolve industry-related concerns. These apps come in various niche-specific categories.
- Apps for claim settlements: Manage handlers’ requirements.
- Apps for travel insurance: Provide information about the destination country – including health & security, weather, flight changes, etc.
- Apps for car insurance: Allow users to gather all required insurance information about their car accidents.
- Apps for sales management: Help workers to access sales & marketing materials quickly.
- Apps for insurance brokers: Support insurance brokers in managing insurance product life cycles and offer their customers an omnichannel experience.
Since each app in these categories has a unique set of features, the final cost will be determined by its functionality for a particular industry.
We determined the price using the common features that are generally similar across various insurance app categories.
|Feature||Development time (in hours)|
|Health insurance specifics||44|
|Car insurance specifics||44|
Users of investment platforms may research and invest in different financial assets. By giving them access to pertinent analytical data, investment management solutions aid investors in improving their return on investment.
The following are good examples of investment apps:
- Acorns: This app is built specifically for novice investors. Acorns provides step-by-step investing. The software tracks the purchases made with your credit and debit cards and rounds up each one to a round sum. The investment portfolio has a margin set aside for it.
- Stash: Stash offers both DIY and automatic investments, making it a popular app for beginners. Your purchases can be rounded up to the next dollar using Stash, and whenever those roundups reach $5, Stash will transfer the money to your investing account. It has a Stock-back feature to earn stocks as rewards when shopping.
- Robinhood: With a no-commission brokerage model, it remains the top choice for new investors; they can invest in stocks, ETFs, options, and cryptocurrencies with zero commissions. The app notifies users of changes and offers real-time market data for cryptocurrencies, coins, or options.
Here’s the estimated development time for each feature of an investment app:
|Feature||Development time (in hours)|
|Withdrawals & deposits||132|
This app type allows users to manage their funds and avoid exceeding their budget by planning their expenses.
Below are some popular apps for consumer finance management:
- Mint: With Mint, customers can easily keep track of their income and expenses and manage their money. Bank accounts, PayPal, and numerous credit cards can all be connected with this software.
- Empower: The app lets you link and manage your IRAs, mortgages, loans, checking, savings, and credit card accounts. It shows a snapshot of recent purchases by categorizing them. You can edit those categories and see what proportion of your monthly spending each one accounts for.
- GoodBudget: This program is based on the envelope budgeting method, in which you allocate a certain percentage of your monthly income to certain areas of spending. Goodbudget offers excellent reporting tools to display your income vs. your expenses and how they change monthly. Easy-to-read visuals in the app help you better understand your spending patterns.
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Let’s see the time spent on building a consumer finance app’s features
|Feature||Development time (in hours)|
|Account aggregation & management||72|
|Spending & income tracking||44|
|Financial goals & progress||58|
So let’s determine the final cost of developing a fintech app according to the type of application. The estimate below is based on the average Southeast Asian software development rate of $25/hour.
|App type||Total development time (in hours)||Final cost|
|Consumer finance app||2600||$65,000|
*Note: The time and cost for app development here are only estimated numbers. Contact us to get a customized project estimation for your finance app.
3. Fintech app development cost based on location
Asides from the app type, the location where you hire developers to work on your app also impacts the final cost. The two most popular approaches are working with an in-house team or outsourcing an IT service vendor.
You may want to think about hiring nearshore or offshore financial app developers to save some money. This approach removes the need for management, product delivery, and additional costs like office rental and equipment expenditures.
Fintech app development expenses, when outsourced, can vary significantly by area, from $140,000 in Asia to $350,000 in North America.
We looked at developer rates in various locations to estimate the price of developing the aforementioned fintech apps. The resulting total expenses are shown in the table below:
|App type||Southeast Asia||Eastern Europe||Western Europe||North America||Oceania|
When selecting a foreign company, you could experience time zones and language barriers. However, if you choose to partner with competent fintech vendors like Savvycom, this problem can be resolved quickly. We have improved the software delivery process to prevent misunderstandings and delays in communication. We always create a communication plan before starting any project to ensure effective communication with our clients. This plan includes scheduling meetings at convenient times and timely updates on product progress.
4. How an app development should look like
The structure of a standard app development team can vary depending on the size and complexity of the project. However, here is a common structure that includes key roles and responsibilities:
- Project Manager: The project manager is responsible for overseeing the entire app development process. They coordinate and manage the team, set project goals and timelines, allocate resources, and communicate with stakeholders.
- Product Owner: The product owner represents the client or business and is responsible for defining the product vision, prioritizing features, and ensuring that the app meets the requirements and objectives. They work closely with the development team to provide guidance and make key decisions.
- UX/UI Designer: The UX/UI designer is responsible for creating a user-friendly and visually appealing interface for the app. They conduct user research, design wireframes and prototypes, and collaborate with the development team to ensure a seamless user experience.
- Mobile App Developers: The app development team typically includes developers who specialize in mobile app development for specific platforms such as iOS (using languages like Swift) or Android (using languages like Java or Kotlin). They are responsible for coding and programming the app’s functionality, integrating APIs, and ensuring the app is robust and performant.
- Backend Developers: Backend developers are responsible for building and maintaining the server-side infrastructure that powers the app. They handle tasks such as database management, server configuration, API development, and integration with external services.
- Quality Assurance (QA) Engineers: QA engineers are responsible for testing the app to identify bugs, usability issues, and ensure its overall quality. They develop test plans, perform manual and automated testing, and collaborate with the development team to resolve issues and improve the app’s stability and performance.
- DevOps Engineers: DevOps engineers help streamline the app development and deployment process. They are responsible for tasks such as continuous integration and delivery, version control, infrastructure management, and ensuring smooth operations of the development environment.
- Database Administrators (DBAs): DBAs are responsible for designing and managing the app’s databases, ensuring data integrity, performance, and security. They optimize database queries, manage backups, and assist in data migration.
- System Administrators: System administrators manage the app’s servers, networks, and other IT infrastructure. They ensure server availability, monitor performance, handle security measures, and manage cloud services if applicable.
It’s important to note that the size and specific requirements of a project can lead to variations in team structure. Some roles may overlap or be combined, especially in smaller teams or agile environments. Additionally, roles such as marketing, sales, and customer support may be involved in the app development process, depending on the project’s needs.
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A fintech app is a mobile application that offers financial services and utilizes technology to provide convenient and innovative solutions for tasks such as banking, payments, investments, lending, budgeting, and more.
Fintech apps prioritize the security of user information. They implement various security measures such as encryption, two-factor authentication, biometric authentication, secure data storage, and adherence to regulatory standards like GDPR or PCI DSS.
Fintech apps operate under regulations and licenses to ensure that they meet strict security and compliance standards. However, it's important to research and choose reputable apps from trusted providers, read user reviews, and check if they are backed by established financial institutions.
Fintech apps provide numerous advantages, including convenience (access to services anytime, anywhere), speed (instant transactions), lower costs (fewer overheads compared to brick-and-mortar banks), enhanced user experience, personalized financial insights, and seamless integration with other digital services.
Fintech apps have the potential to increase financial inclusion by reaching populations that are traditionally underserved by banks. With the widespread adoption of smartphones, fintech apps can provide basic banking services, digital wallets, and microfinance options to the unbanked and underbanked populations.
Fintech apps offer a wide range of services, including online banking, money transfers, bill payments, budgeting and expense tracking, investment platforms, digital wallets, peer-to-peer lending, insurance, cryptocurrency trading, and more. The specific services offered may vary across different apps.
Many fintech apps operate globally or have expanded their services to multiple countries. However, availability and specific features may vary by region due to regulatory requirements and partnerships with local financial institutions. It's advisable to check the app's compatibility with your country or region.
Fintech apps leverage AI and ML algorithms to provide personalized recommendations, fraud detection, credit scoring, risk assessment, chatbots for customer support, and efficient automation of various financial processes. These technologies enhance user experience, accuracy, and efficiency.
While fintech apps offer a wide range of services, they may not completely replace traditional banks. Traditional banks still provide services like physical branches, face-to-face customer support, complex financial products, and regulatory expertise. However, fintech apps are reshaping the financial landscape and becoming significant competitors to traditional banks.
Fintech apps typically provide customer support through various channels, such as in-app chat, email, or phone. They often prioritize quick response times and aim to resolve issues promptly. Dispute resolution processes may vary, but fintech apps usually have procedures in place to handle customer complaints and ensure fair resolutions.