Fintech App Development - How Much Does It Cost?

In this guide, we’ll explore the factors that will affect your costs, and the various approaches you can take when doing fintech application development.

Thinking about creating a fintech app? It’s a good idea, since the industry is expected to grow to a market value of more than $309 billion by 2022. If you’re considering developing a fintech app, you’re almost certainly wondering how much it’ll cost. The short answer is – it depends – as many different factors affect cost. Developing your own app from scratch is quite an expensive endeavor, but there are other options that can significantly reduce your costs.

Fintech App Features

The purpose behind your app, and the features you plan on including, will play a major role in determining the cost of developing it. Some of the most common types of fintech apps include:

Banking apps used for account management, money transfers, bill payments and more
Lending apps
Stock trading apps
Payments apps, such as apps for processing credit card payments
Personal finance apps, such as expense tracking apps
Cryptocurrency apps

Common Fintech App Features

The cost of a fintech application depends heavily on the number of features you want to include and their complexity. Some of the common features included in fintech apps are:

User interface and user experience: It’s essential to put sufficient focus on user interface (UI) and user experience (UX). UI and UX are the features that make your app easy to navigate and use. Even if you have incredible features, without good UI and UX, most users won’t want to, or won’t be able to use them.
Personalization: Apps today increasingly feature personalization. They often use artificial intelligence to enable quick and easy customization for users. Personalization features include calling users by name, customizing the home screen, and offering suggestions based on a user’s preferences.
Security: All app developers must consider security and privacy, but it’s especially important for fintech apps. Fintech apps must have secure authentication procedures, and be protected against data leaks and cyber attacks.
Data analytics: Many fintech apps involve collecting, organizing, and analyzing financial data and then presenting it to users in an easy-to-understand format. For instance, people may use the app to track their personal finances, or to follow certain stocks.
Onboarding: Fintech apps typically need to collect more information from users than other types of apps, due to the various rules and regulations that apply to the financial industry. The goal of the onboarding process for a fintech app should be to get as much relevant information from users as possible, with minimum input from the user. You need to collect sufficient data, but the process should also be convenient for the user. The onboarding process should also inspire trust in the security, reliability, and value of the app.
Integrations: Many fintech apps also require integrations with third-party vendors, to provide additional functionality, or information. These integrations may enable users to make payments, transfer funds, or track spending in real time. Getting approval from vendors for these integrations can be a long process.

How Much Does It Cost to Develop a Fintech App?

The cost to build a mobile app varies widely based on many different factors. To get a rough idea of what it would take a financial institution to build an app from scratch, you can look at the typical salary for software developers, the number of people on an app-building project, and how long that project would take.

Plus, you’ll have to hire managers, consultants, testers, integrators, support personnel and others, and pay for benefits, office space and office expenses. Having a team of 20 people, which can cost over $4 million annually, isn’t uncommon. At the end of a two-to-three-year project, you might have spent over $10 million. Plus, you’ll have ongoing expenses to maintain the app.

According to data from the U.S. Bureau of Labor Statistics, the median pay for a software developer in 2018 was $105,590 per year. It could take one to three years for three to five developers to build a fintech app. That adds up to between $316,770 and $1,583,850, just in developer salaries.

Stages of Fintech Application Development

To get a more precise estimate of what it would cost to build an app, you can estimate how much time you’ll need to spend on each stage of the development process. Then, you can multiply these times by the required salaries and other expenses to get an idea of your costs.

Typical steps in the development of a fintech app include:

Planning: The planning stage involves researching the target market, analyzing competitors, defining key issues and goals, deciding on the features you want your app to include, and choosing the operating systems your app will support.
UI/UX design: Before development begins, designers will create UI wireframes, UI/UX designs, and mockups. The length and cost of this stage depends in part on how many screens will be included in the app.
Development: Next, the software engineering team will complete frontend and backend coding. This step also typically includes early testing and bug fixes. The length and cost of this step varies widely, depending on the features and complexity of the app.
Testing: Once development is completed, the app should undergo more testing to ensure that everything works correctly.
Marketing and deployment: Before releasing your app, you will need to invest in marketing your app to gain users. Then you can launch your app on the pre-determined launch date.
Maintenance and support: You will also need to invest in ongoing maintenance and updating of the app. While this is not part of the initial development cost, it is a cost that needs to be accounted for to ensure a successful app over the long-term.

Other Factors That Affect Fintech Application Development Cost

Some of the other factors that may affect the cost of building a fintech app include:

Features: The number and complexity of the features included in an app will significantly impact its cost. Some financial institutions may launch apps with only basic features at first, and then add more features later.
Operating system: Whether the app will work on Android, iOS, or both, also affects costs. Creating an app that works on both is more expensive.
Native or hybrid: Native apps are made for a specific programming language, while hybrid apps are essentially websites designed for use in an app. Native applications are more costly to develop, but offer enhanced performance.
Compliance and security: The compliance and security requirements you need to meet will also affect costs and depend on the app’s features, the type of organization, your location, and other factors.
Integrations: Many third-party APIs cost money, and in general, the more integrations you need, the higher your costs will be.
Dynamic content: Dynamic content enables personalization and two-way communication. Most fintech apps will include dynamic content, which increases costs.

App Development Methods

When creating an app, you have ways to develop it. These methods come with different costs, as well as pros and cons. Some of these methods include:

In-house development: In-house development involves hiring an internal team to build your app — this requires significant up-front and ongoing investment, but you get complete control over the process.
Outsourced development: You might also choose to hire an outside company to build your app. This still involves significant upfront investment, but avoids many ongoing expenses.
Freelancing: If you hire freelancers, you’ll need to pay hourly or per-project rates, which vary based on the freelancer’s experience. You usually won’t have to pay for office space or benefits, however.
Do-it-yourself development: You could also choose to take a DIY approach. While this will reduce your costs, it will require a massive time investment, and is risky if you’re not experienced with banking or fintech app development.
Fintech APIs: You could also use REST APIs to build your app. Using existing APIs reduces your workload, but you still have flexibility in creating your app.
Fintech white labels: You can also use white-label apps, which are apps built by a different company that you can configure and market as your own. This reduces customization, but minimizes your workload, while still providing you with a high-quality app.

Develop Your App for 80 Percent Less With Hydrogen

With Hydrogen, you can quickly build hundreds of applications using a single, flexible and secure platform. We’ve already done the hard work of creating the fintech infrastructure — you just need to choose the features you want. We offer platform APIs and no-code white labels to give you maximum flexibility and functionality.

With Hydrogen, you can deploy your fintech app in 80 percent less time and at 80 percent lower cost. We have a marketplace of third-party certified partners that can help you, if you decide to go down the outsourced development path. To learn more, contact us today.