Issuers and financial institutions can no longer rely on old systems to appease the modern customer because consumers are constantly interacting with new technology, which is changing their expectations for service.
Quality, speed, security, and easy-to-use systems are becoming the norm. To increase customer retention and remain competitive locally and online, agility must become a primary area of focus for financial institutions.
By outsourcing fintech development, it's likely companies will increase productivity by at least 50%.
Automated processes and innovative solutions save time and money, but many banks have yet to transition from manual work that’s expensive and slow. Outsourcing financial technology development reduces the unnecessary time and overhead costs because as fewer employees are required to work directly with customers throughout the day, there are shorter wait times, less possibility for error, and banks avoid the additional expenses of maintaining a large staff.
Internal IT teams also take longer to adopt new systems due to setbacks within the industry, such as regulations and relying on employers for necessary equipment. This sets limitations that outsourced developers do not have when implementing new technology. Outsourced teams do not require that clients follow the same protocol as onboarding new hires directly. These workers usually have their own equipment, and their specialized knowledge of development helps them analyze where a bank should be utilizing new technology from end-to-end.
From a different perspective, consider the transformative ideas that come directly from in-house workers. With so many daily objectives to meet and customers needing service, some of the best ideas from developers may never get out the door. If a great idea does go into development, it may be in the very distant future and lack impact if a competitor releases a similar product beforehand. Passing ideas along to outsourced developers helps companies get products to market quickly and builds morale by showing your in-house team their input is valuable.
Another significant advantage worth noting is that outsourcing keeps IT staff from exerting more valuable time and resources because they won't be building code from the ground up or frequently testing new code during development.
CIOs are now addressing the deployment of advanced financial technology as a critical element of banking. In fact, 83% of bank owners fear that standalone technology will make traditional banking obsolete in the future. As more banks come to terms with these technological shifts, they are looking towards outsourcing as the answer for remaining relevant in the financial industry.
Furthermore, financial institutions face compatibility issues when partnering traditional systems with new technology, which leads to malfunctions and security risks. Security concerns come into play because legacy systems that are not brought up to speed are less likely to protect customer and employee information while hackers are becoming more technologically advanced.
Customers rely on technology for convenience and security when making deposits, withdrawals, receiving account updates, and more. As the legacy systems at banking establishments continue operating using outdated programming and applications, shareholders and decision-makers are citing these systems as a cause for concern because they increase vulnerabilities and inhibit the growth of companies.
Tech development from outsourced workers mitigates risks while adding an additional layer of security because the developers are familiar with the tried-and-true systems that work. Outsourced developers are also working under contracts that hold them to high-performance standards and sets clear terms and deadlines for each project.
But outsourcing fintech development doesn't mean financial institutions must assign entire development projects from the start. Instead, these developers can work with your team by upgrading current systems. Fintech development can also be beneficial for in-house support, should your staff need assistance creating development plans that will be beneficial now and in the future.
Technological innovation helps institutions streamline internal work processes and grow their customer base because fintech lightens the load of manual tasks assigned to employees and saves time for existing customers. As more brands introduce customer-focused systems that are often accessible from home, outsourcing fintech development will give issuers the competitive edge that is now necessary for building and maintaining customer loyalty.