Challenges

FinTech

Cyber Security

In 2022, the use of financial technology increased by 72% within Europe. However, as with any rapid growth, the sector started to experience several unintended consequences. The primary one was related to security concerns. It is not surprising that cybercrime is on the rise today and not only in the Fintech space. According to a report, every 39 seconds new attacks on users’ profiles appear. Fintech companies are suggested to be the main target of cyber hackers in 2022

Scarcity of Tech Expertise

Among FinTech challenges in 2022, lack of tech expertise is almost the main one. The development of high-quality and safe FinTech solutions, such as banking apps that will also have smooth functionality, ultimately requires in-depth expertise and solid background. Not everyone is able to craft an in-house team of skilled engineers who are aware of the newest tech advertisements to make sure the app has a high-security level without compromising the quality.

As a result, more companies now choose to outsource FinTech app development to get a well-thought-out application. A ready-made team usually understands financial projects and minor points that have to be followed for success. You can hire an outsourcing team that has expertise in FinTech app development with real-life cases to make sure your app will be done by professionals only. In addition, outsourcing helps to reduce costs for development in the long run and lets you focus on more vital things like marketing.

Winning and Nurturing User’s Loyalty

FinTechs have to collect sensitive data about their customers, which is why it is one of the most crucial parts of a FinTech app. This can become a huge problem for startups who just entered the market; they need to prove that their cybersecurity systems and protocols are safe, secure, and fit the latest standards.

This can be achievable through ensuring transparency of every company’s activities. You can also create customer communities and events and constantly interact with your customers to learn more about what they like or don’t. Outstanding customer experience can be achieved by making sure your service meets their needs and through pleasant UX/UI design.

Blockchain

Rising Cost of Blockchain Implementation

The initial investment to implement blockchain technology may be prohibitive, especially for small enterprises with limited means. Another potential point is that switching to a chargeable version of the software can become costly if you decide to use it over multiple years. Moreover, blockchain applications require substantial IT infrastructure investments because they rely on high-performance server farms and ensure availability by being fault tolerant.

Criminal Activities

The relative infancy of the industry has made fraud and other illegal activity especially rampant in the cryptocurrency space. The absence of adequate legislation, coupled with the fact that blockchain is still a developing technology, has enabled fraudulent projects, bad actors seeking to profit from inexperienced investors, and even exchanges stealing other people’s money.

Integration with Legacy Systems

Most organizations must completely rebuild their old system or develop a strategy to link the two technologies successfully if they decide to utilize blockchain. Another issue is that organizations lacking blockchain developers do not have access to the required talent pool to participate in this process. This problem can be exacerbated by reliance on an external source. However, most solutions on the market need the company to invest a significant amount of time and resources for it to complete the shift.