How to Build a SaaS Product for Any Business?

Though the idea of providing computer-based services over a network started to evolve in the 90s, the brand-new Software-as-a-Service applications took over a decade to achieve record growth in the software market. Today, the SaaS development model has been known as a robust foundation for thousands of businesses operating across various industries, from banking, business services, and manufacturing to retail and the government.

While some business owners are still unaware of what SaaS is and how it works, they’ve surely used SaaS-based applications for some workflows already. You don’t need to rely on our words solely. Just check out the structure of popular applications such as Google Workspace, Salesforce, Gmail or Hotmail, Office 365, and Google Docs. Yup, all those are some of the most common examples of cloud-based SaaS services used by billions of users on a daily basis.

In fact, the SaaS app development model provides a wide range of opportunities for thousands of companies in many industries. Its cost efficiency, high personalization and automation, seamless scalability, decent security, and many other benefits help enterprises empower their performance, become more competitive, and hit new heights.

Looking for a reliable tech provider to build your own SaaS?

Read our guide below and do not hesitate to reach out and talk about your future business with us!

But are SaaS products worth it for your business?

Our IdeaSoft experts are here to provide you with the answers! In this guide, you’ll explore what Software-as-a-Service development is, its perspectives, and significant benefits which can help enhance your business performance in different ways.

Table of Content:

Major Types of SaaS Software Solutions
Horizontal SaaS, Vertical SaaS & On Top SaaS
Advantages of Software-as-a-Service Products
How to Build a SaaS Product for Your Business
Conclusion

Current State Of SaaS Market

Despite the fact that this area is relatively new, the software-as-a-service market is extremely prospective and has shown rapid growth over the past few years. The global SaaS market is expected to evolve at a CAGR of 11.0 % during the 2022-2028 period, according to Fortune Business Insights. By 2028, the market is expected to grow to an impressive $344.3 billion, which is mainly stimulated by the wide adoption of SaaS in the cloud computing industry.

Today, you can already discover hundreds of SaaS applications, such as conferencing, cloud telephony, salesforce automation, customer relationship management (CRM), web content management, and many others.

Along with cloud-based solutions, the SaaS market also benefits from other emerging technologies, such as containerization, virtualization, edge computing, big data, AI and machine learning, and so on.

Most Prominent Examples of SaaS Projects

To build your own SaaS, it’s always good to uncover success stories of some of the most popular products built in a cloud environment. We’re more than sure that you’ve heard of most of them and regularly use them in your everyday life!

Netflix

Surprise: one of the world’s biggest entertainment and media brands launched in 1997 is actually based on the SaaS model! In the year 2007, the company refocused from the business of only renting DVDs when it launched streaming media and videos – and that proved to be a great decision! Today, Netflix’s entire value proposition is tied to offering first-class on-demand streaming with 24/7 access and no ads at all!

Slack

Another prominent example of a SaaS app development project that offers a wide range of features for efficient business communication and private messaging. Along with collaboration, the application supports file sharing and features advanced security. It is pretty simple to use and has a plethora of integrations with various third-party services for an enhanced user experience.

Slack is valued 26.5 billions as of 2024. This makes Slack the 730th most valued company globally as per market cap.

Shopify

With more and more SaaS solutions appearing in retail, it is unacceptable to overlook one of the most famous cloud-based CMS examples within the target industry – Shopify. With the spike in online purchases and an impressive demand for eCommerce websites, this Canadian-based service enables small and medium-sized businesses to build their online presence by setting up an online store with no coding experience.

As of 2021, the company’s annual revenue reached $4.6 billion, and with the growing demand for online stores in eCommerce, it will continue to grow further.

Zoom

Apart from the growing trends in online shopping, the Covid-19 pandemic uncovered a huge demand for virtual meetings, and that’s when the Zoom platform came into play. Its simplicity of use and seamless performance have facilitated online communication and enabled users to set up various events such as virtual meetings, conferences, webinars, and more. What’s even more important, it has a large set of easy-to-use tools (screen sharing, admin control, waiting rooms, and more), which makes communication more efficient than ever!

A decade after its release, Zoom has $1.06 billion net income and has become a decent alternative to popular SaaS products like Google Meet, Microsoft Teams, and others.

Atlassian Jira

The increasing popularity of agile project management has inspired developers to create software as a service applications which efficiently track and manage project development workflows. Its versatile system, easy integration with 3rd party software, and many other advanced features made it suitable for different audience segments, including developers, project managers, engineers, non-technical professionals, and so many more.

After over two decades of market presence, in 2024, Atlassian generated revenues of over 4.3 billion U.S. dollars.

Major Types of SaaS Software Solutions

Having reviewed some of the most popular SaaS application examples, let’s briefly summarize what software categories are built on cloud infrastructure today:

CRM (Content management systems)
eCommerce applications
ERP software (Enterprise resource planning apps)
Billing software
SaaS-based collaboration tools
Marketing software
Human resources management

However, there is also a different classification for SaaS products, according to which these are divided into Horizontal SaaS, Vertical SaaS, and On-Top SaaS solutions. Below we’ll explain what’s the difference between these SaaS types, so you could identify which one will be the best to build your own saas.

Horizontal SaaS, Vertical SaaS & On Top SaaS

When studying SaaS product development, you’ve definitely come across the terms “horizontal SaaS,” “vertical SaaS,” and even “On-Top SaaS.” Though these concepts relate to one category of Software-as-a-Service products, their use cases are entirely different:

Horizontal SaaS – the type of cloud-based solutions which are targeted to a broad audience of business users, regardless of their industry. It mainly aims to satisfy business needs rather than individual consumer ones, providing a broad service that covers diverse niches.
Examples: Salesforce (CRM), HubSpot (marketing, sales, content and other), QuickBooks (accounting), etc.
Vertical SaaS – a comparatively new segment of cloud-based products which is focused on a particular niche or industry-specific standards. In most cases, vertical SaaS solutions are developed for more narrowed industry verticals and are designed by people with expertise in the specific industry it targets.
Examples: Guidewire (Insurance), Health Assurance Plan (dental software), BioIQ (MedTech), etc.
On Top SaaS – This is an industry-specific or neutral SaaS segment designed to integrate with existing or multiple solutions.
Example: Zapier SaaS application, which works with Xero, SalesForce, Slack, and others.

Understanding the difference between these categories will definitely help you build SaaS products. Next, let’s briefly review the perspectives of cloud services in the coming years to identify their actual value.

How to Build a SaaS Product for Your Business

SaaS app development is a highly prospective area that can bring your business to a completely new level of development. Let’s take a look at our SaaS product development guide that ideally fits your enterprise’s key objectives and needs.

#1. Conduct Market, Client & Competitor Analysis

To create functional and competitive SaaS software, the first phase of the development process should include three major components:

Tech trends – the technologies which can improve a product’s features, usability, and competitiveness in the market.
Customer needs – the preferences and concerns of your target audience which are related to your SaaS idea.
Competitors – the strong and weak points of similar SaaS solutions within a target niche, allowing for better targeting of your customer’s needs.

These simple stages can help significantly in planning your SaaS software’s functionality, allowing you to get on top of competitors. At the same time, learning the target audience during the discovery phase allows businesses to better understand their pains and ways to resolve them, which is basically the key component to the project’s success.

#2. Determine the Project Requirements – Discovery

Once you’ve learned the target market and know your customer persona, it’s time to point out the essential requirements of your SaaS project. These are the “backbone” of your upcoming software. These determine its architecture, functionality, and other must-have aspects of SaaS product development.

While setting up the requirements, you’ll want to consider the app monetization model, data and application security concerns, third-party integration, application design, maintenance specifications, and so on. Additionally, SaaS development requirements are considered based on your business objectives to maximize the project’s potential ROI.

#3. Hire an Expert SaaS Team

One of the critical things to consider when building a SaaS product development expertise. Make sure your team has the required knowledge and skills to bring your product to reality successfully. Usually, the development crew should include business analysts, designers, software developers, QA engineers, and project managers.

Additionally, you’ll also want to consider the cooperation model with the SaaS development vendors in your project, choosing between the in-house team, freelancers, or a specific custom SaaS development company. Unless you have top-notch in-house developers on your team, we highly recommend opting for a skilled crew of specialists with proven experience in SaaS projects. This will help you ensure timely deliverables, advanced system security, and excellent functionality of your software, all at the most reasonable costs!

#4. Choose the Required Tech Stack

Similar to any other type of software development, you’ll need to consider the most optimal technologies for the app’s front end and back end, storage DB solution, and application server. Since all these components have a considerable impact on the final SaaS product, as well as its efficiency and effectiveness, it’s critical to pick the tech stack that best fits your project requirements.

Here are our picks for each aspect of the SaaS development process:

Front end: HTML and CSS, Javascript frameworks – Vue.js, React, Angular.
Back end: MySQL, MongoDB, or PostgreSQL
Server-side: Ruby, Python, JavaScript, PHP, and corresponding frameworks.
App servers: Cloudflare, DigitalOcean, Google Cloud, HubSpot, Kaltura, and Pantheon.

The tech stack is ready, so it’s time to consider the best expertise for your SaaS project deliverables!

#5. Build an MVP & Launch the Development

We highly recommend starting from MVP to test and optimize ideas for your startup or project in SaaS development. A minimum viable product will work as a so-called trial version of your SaaS application and allow you to check the proof of concept, understand the value of the software, its strengths and weaknesses and help you prepare for the final product development. Once the MVP is ready, make sure to dedicate some time to its testing and validating, as it can uncover the slight imperfections to potential problems which might hit the product’s performance during the development or afterward.

Your team can finally continue building a full version of the SaaS product after all the corrections are done. Typically, we recommend applying the Agile methodology for continuous development, testing, and faster time-to-value. To maximize the project’s end results and speed up the app release, try to communicate continually with your developers to ensure that you share the same vision about the product’s features and requirements.

#6. Finalize Your SaaS App

Once the SaaS application is finalized, do a final checkup of its full functionality and market response before its official release and deployment. Also, consider additional steps for app maintenance and improvement, ensuring that all your customers have seamless access to all application updates and 24/7 technical support.

Advantages of Software-as-a-Service Products

As you can see, the Software-as-a-Service industry will remain among the major trends in app development. But why is it a top choice for various companies from different industries?

The answer literally lies on the surface! Just simply check out these significant advantages of SaaS solutions for business:

Advanced Security – being one of the major concerns among SaaS providers and their clients, most of the apps feature a decent level of security for protection against cyberattacks and misuse.
Accessibility – the only thing you need to run a SaaS app is an Internet connection, as the cloud-based system can be accessed anytime and from anywhere
Flexible Payment Solutions – monthly fees for SaaS platforms don’t require significant expenses compared to licenses which can be an excellent fit for your company’s budget.
On-Demand Scaling – unlike traditional licensed software, cloud infrastructure features are easily scalable according to your business needs and don’t require add-on expenses for infrastructure upgrades.
No Setup Required – due to their cloud infrastructure, SaaS applications can be accessed from any device in just a few clicks with no installation hassles.
Convenient Proof-of-Concept Checkups – Unlike traditional software, SaaS solutions enable a comprehensive overview of all the available features before buying a subscription, which can give you a better understanding of their value.
Data Management and Analytics – SaaS solutions enable an advanced overview of different types of data, and their efficient, analysis in real-time. This helps to quickly get the latest insights on the strong and weak points of business performance and other critical information.
Market Reach – In most cases, SaaS applications are universal and can easily be a good fit for a wide range of businesses, regardless of their industry, size, or goals.

Therefore, whether you’re running a small business or a large-scale corporation, opting for a SaaS project development is definitely worth it. Below our experts explain how to effectively create a SaaS product for your business to make the most of its functionality.

Conclusion

With improved cost-efficiency, enhanced accessibility and availability, an impressive set of features, and excellent scaling solutions, SaaS applications have already become a must-have option for various businesses today.

Nevertheless, learning the specifics of their development and a bunch of the most prominent SaaS examples is only a part of the journey. Getting the right software development provider is essential to build a SaaS product that can maximize your business performance.

When hiring a team of qualified SaaS experts at IdeaSoft, you’re guaranteed to get top-notch development professionals who are aware of the latest trends in the SaaS industry and how those can benefit your business. With over 250 projects delivered, our crew is ready to deal with any challenge in software engineering regardless of the project’s industry, scale, and complexity.

Are you ready to start? Contact IdeaSoft and get your best SaaS team on board right away!

Top Challenges of Developing Mobile Apps for Businesses in 2023

For millions of businesses, launching a custom software solution is no longer an option but a necessity. Today, investing in high-quality, functional software helps improve a brand’s online visibility, benefits customer engagement and loyalty, enhances business competitiveness in the market and of course, generates higher revenues.

Nevertheless, with the many advantages that come with custom app development, there are a lot of challenges businesses need to resolve when launching a custom application. In some cases, these pitfalls can become serious problems that can significantly impede the app’s efficiency or completely ruin its value for a particular business.

In this article, we will uncover the most critical challenges in developing mobile app software and review some examples of successful business startups with impressive revenues. As a part of our discussion, our software experts from IdeaSoft will analyze some of the most common challenges in launching a mobile app for a business throughout the entire development life cycle.

If you’re ready to get started with your next development project – contact our team right away! Our development experts will immediately start working on a mobile app solution which will ideally fit your business objectives and goals.

Table of Content

Market Overview
Major Challenges in Mobile App Solution Development
Summary

Top 5 Examples of Successful Mobile Development Startups

IKEA Place App

Before we start diving into mobile app startup development, let’s review some of the most world-renowned cases of mobile application products and what makes them so valuable from a business perspective.

IKEA Place is an application that helps customers see how a particular Ikea item would look in a particular space. Users can scan various product options offered in the catalog and get a 3D image of a piece of furniture, which gives an impression close to the one a customer gets while visiting an offline store. Additionally, the application enables users to create lists of their favorite things, scan product barcodes to learn more about an item, check product availability as well as get unique discounts and attractive deals exclusively for IKEA Family members.

As a result, the IKEA mobile application has managed to improve and streamline customers’ decision-making and purchasing processes. The company reports that the application has been downloaded over 8.5 million times.

Sephora Mobile App

With over 1750 retail stores in over 30 countries, a mobile application for the international beauty brand Sephora enables customers to easily find and purchase the products they need right from their couches. According to Statista, every month the app is downloaded over 520,000 times on average, and during the online sales season at the end of the year, it can hit up to 700,000 downloads.

Today, the application is extremely popular in the US and Canadian markets and is continually implementing new technologies and solutions aimed to enhance the app’s usability and shopping experience. For instance, Sephora’s Virtual Artist application allows customers to leverage the power of augmented reality when choosing the most suitable beauty product based on their makeup preferences and facial parameters.

Notion SaaS App

A great example of an excellent cross-device application that has become exceptionally popular in 2022 is Notion. It is an all-in-one workspace that unites notes, tasks, wikis and databases within a single ecosystem. If you try it once, you’ll realize that the application is really versatile and extremely functional. It can be a great fit for users from an average technical level to advanced or pro users in organizing their daily routines or business workflows.

Now, let’s dive into the numbers. Currently, the application has over 30 million users (for comparison, there were only 1 million users back in 2019), and around 4 million subscribers. Notion is estimated to make $67.2 million each year, while the estimated valuation of this software is $10 billion.

Considering the fact that the company started with just 12 employees in 2016, it does seem impressive, doesn’t it?

Foodpanda Application

Foodpanda is known as the “leading online food delivery marketplace in emerging markets”, which offers online ordering and delivery services for your favorite food and gets it to your door with just a few taps on your smartphone. The service was launched in 2012 and has been introduced in East Asia, South Asia, Southeast Asia and a few EU countries. Currently, it is one of the most well-known food ordering and delivery applications that offers a wide range of foods for any taste, and at the most attractive discounts.

Today, the application works with over 115,000 restaurants and covers various cuisines in over 400+ cities across the globe. According to the most recent open data, the application raised a total of $749.5 million and has a peak valuation of $40 to $50 million as of 2017.

Coca-Cola

In their mobile application, the Coca-Cola brand decided to leverage the power of AI and Machine Learning solutions to better understand user behavior based on buying patterns and how they respond to various offers and campaigns. The mobile application enables customers to redeem loyalty points and discounts on their favorite drinks, and in some countries even purchase the brand’s soft drinks from vending machines.

As a result of the mobile app launch, the company managed to make a higher profit than it did before the pandemic. In particular, Coca-Cola’s third-quarter revenue significantly surpassed 2019 levels, with $11.063 billion in Q3 2021 vs $9.507 billion for Q3 2019.

Major Challenges in Mobile App Solution Development

Once you’re inspired by the success stories of famous enterprises in app startups, it’s time to look closer at the major problems businesses might face when developing a basic mobile application.

Planning Stage

Regardless of the app type you’re about to launch, the first stage of any application development covers every aspect in detail. From what the app is about, the target audiences and their pains, what technologies you’re going to use, key goals and requirements, as well as how to measure success.

Challenge #1. Poor User Experience

Creating the right customer experience is one of the most essential aspects that can help either make or break the success of your mobile app. Typically, users prioritize the application’s features and ease of use above all else, which is why 86% of customers would leave a brand after as few as two poor experiences.

Additionally, nearly 83% of executives feel that unimproved customer experiences can significantly affect a company’s revenue, market share, and risk.

Solution: When planning the functionality and design of your upcoming app project, make sure to prioritize the user’s needs and the key app objectives first. An outstanding UX will not only improve the first impression of your application but also make your product more competitive in the target market segment.

Challenge #2. Research the Competition

Another essential point that can impact the end result of your mobile application development is insufficient market research. Same as with audience research, knowing who your direct competitors are and learning their key strategies can directly improve your software product right from the initial stages of development.

Solution: A comprehensive study of your competitor’s application will give you more insights into the strong and weak points of their products, as well as provide you with a bunch of ideas on what to add or improve in your upcoming product. Similarly, such research can provide a huge boost in inspiration for design concepts that can be a great fit into your mobile application.

Challenge #3. Requirements Clarification

Before you get started with the development stage, it’s also critical to outline the key requirements of your product and establish the goals it will help you achieve. This involves establishing the product’s vision, scope, cost and schedule for your team, and also allows you to specify the app’s key features and how those features should work.

Setting up these requirements is important for the brand-new software being created from scratch. And it is also important to have clear expectations about your product when creators need to make changes or specific upgrades to existing products to make them more functional or secure for end users.

Solution: To make clear and detailed requirements for your software project, it’s recommended to consider the following aspects:

Determine the intended client for your software, and the goals and issues they might want to resolve
Identify the functions and other software specifics to meet the criteria above
Consider the structure of your documentation to increase its readability and clarity
Identify segments of each functionality to better uncover their purposes and track their progress
Add proposal sections to encourage your team to suggest interesting ideas or add-on functionality for your application

These are some of the most common things to consider when setting up the requirements for your application development.

Development & Testing Stages

After all the preparations are completed, it’s time to get started on the development of the mobile application. Based on the extensive experience of IdeaSoft, the most common mistakes clients make in the development stage include hiring the wrong software vendors, applying outdated technologies and overlooking some of the key compatibility aspects of a mobile application.

Below we’ll explain what makes these issues so critical in the context of app development for mobile devices in 2022.

Challenge #1. Hiring an Inappropriate Team of Developers

The success of any software development project highly depends on the expertise of the developers hired. Even the best-planned functionality can suffer from poor deployment, thus significantly affecting the efficiency and effectiveness of the application.

Hiring the wrong development specialists can also cause issues with the security of the app, its use specifics and other critical issues. This can lead to the failure of the entire startup, as well as significant reputational and financial losses for the client.

Solution: In order to get the best talents for your mobile app development, make sure to hire experienced developers based on your project’s requirements. Additionally, pay attention to and learn more about each developer’s background: tech stacks, programming languages, developer tools and relevant project experience – all the skills and qualifications you’ll need for your particular project.

A good practice is also to prepare key questions for use in interviews and a simple technical task that will help your candidates introduce their knowledge and skills in practice.

However, if you need to hire a full-stack team of mobile app developers, it’s also possible to get professional assistance from an expert development company such as IdeaSoft. So far, IdeaSoft has a 5.0 Clutch rating and dozens of excellent reviews from our clients. With over 250 projects delivered, our team can help you develop mobile-based software of any scope and complexity.

Challenge #2. Using Outdated Technologies

One of the worst decisions made when developing a mobile application is choosing old development technologies. Though those may seem easier and faster in deployment, outdated development tools can significantly hinder the application’s performance, functionality and usability, not to mention the security of the mobile app.

Additionally, this practice may negatively affect the long-term development of the mobile application, which can potentially lead to lower project ROIs for the client.

Solution:

When designing a mobile application, make sure to apply the latest, top-rated solutions which can potentially help your product remain relevant to its consumers for as long as it is possible.

For instance, some of the key technologies applied in 2022 include Artificial Intelligence (applied by over 72% of businesses), IoT (46%), Robotics (35%), Cloud Native Development (24%), Blockchain (22%), Digital Reality (19%) and more.

Challenge #3. Limited Development Budget Issues

At the start, mobile-based projects are usually limited in budget, which pushes companies to reduce the app’s functionality across all platforms or completely rebuild the software concept to fit the expected costs. Naturally, such software provides lower performance and value to the end-users, and can result in less competitiveness, which is exceptionally important for the project’s ROI.

Solution: Instead of cross-platform development, a great alternative for a limited development timeline and/or budget is to launch the app on a single operating system first. For this purpose, identify the most popular operating system among your audiences and find the relevant experts who can help with the development process. A professional software development team can help with the front-end and back-end, UX/UI design, debugging and compatibility checkups to ensure the best performance for the end-users.

After-Development & Release

The last but not least important stage of any mobile app project delivery is the post-development and its official release. Some of the most common challenges in this stage include overlooking the app’s final testing and its proper marketing, as well as support for the mobile application after its official launch.

Challenge #1. Insufficient QA Testing Finalization

To meet the deadlines and start showing up your mobile application to audiences, clients usually overlook the QA stage to speed up the development process. However, being an integral part of any software development lifecycle, such practice helps developers identify the issues with software before its official release.

Skipping the quality assurance processes in mobile software development can result in notable usability issues, high bounce rates and lower conversions, thus ruining all the efforts of the previous project’s planning and development stages.

Solution: Make sure your engineers conduct a comprehensive checkup of the app system across different stages of development. Typically, this includes full functionality and architecture testing, code reviews, as well as many other verifications to ensure the app complies with documentation requirements and security guidelines. This will not only improve the quality of your finalized product but also reduces the post-release maintenance chores.

Challenge #2. Timely Mobile App Marketing

Today’s software market is extremely competitive, which means it’s not enough to just focus on the release of the app. No matter how outstanding your mobile application is, it won’t stand out among competitors and find its audience (and generate revenues as well) without a powerful and properly planned marketing campaign. In some areas, such as blockchain projects or fintech startups for instance, the marketing campaign can start long before the development process to build a strong community at the time of its official release. Otherwise, all your input will be done in vain as your target audience won’t be able to discover it.

Solution: To leverage all the marketing opportunities and effectively reach your audience, make sure to consider the timeliness of your marketing campaign and the key components it will contain. Typically, this includes social networks, organic and paid search, direct and referral traffic sources.

Moreover, launching your marketing campaign in advance enables you to analyze which of the traffic sources works best for the app’s marketing. It also allows you to pinpoint the most effective areas for future product promotion.

Challenge #3. Resolving Issues & Keeping the App Updated

After a client releases a mobile app, a commonly noticed issue is the lack of post-release support of the software. Usually, clients get ready to track the app’s performance and conversions while completely missing sudden performance issues, flaws, bugs or crashes, which in fact require an immediate response. The more problems your customers face while using the app, the less likely they are to continue using it.

Another important aspect to keep in mind is that the device’s OS is constantly evolving, which requires developers to regularly submit changes to keep the application up to date with the latest versions of the particular operating system.

For this reason, some popular app platforms have started to decrease rankings and/or remove or hide outdated applications from their listings. For instance, Google Play has warned developers that starting on November 1, 2022, apps which have not been updated for the latest Android OS releases will be blocked for installation.

Solution: Post-release debugging as well as regular app updates are an unavoidable processes of any application development. That is why when planning a mobile application project, always keep in mind the app’s integration challenges and also the further support of your software to maximize its efficiency and ensure it stays on the top-rated app listings longer.

Final Words

Constantly improving technologies, innovative trends in the world of applications, and thousands of mobile-based apps being released daily, are constant and growing challenges for developers. Being aware of their key solutions can significantly help in launching functional and user-friendly mobile software, which will remain relevant from a long-term perspective. We hope that this article has provided you with some insights into the development of mobile app software and helped prepare you for your upcoming project.

At IdeaSoft, we know how essential it is to focus on every aspect of app development to bring the most value to a client’s business. With 250+ successful projects delivered and nearly a decade of experience in the software development industry, our international team is always ready to empower your business with outstanding, efficient and long-term software solutions that will help your business succeed.

If you’re looking for a dedicated team of experts for your mobile app development project, feel free to reach out to our team. IdeaSoft developers are always here to provide a top-notch development strategy that will perfectly work for your business!

6 Major FinTech Risks and Challenges in 2025

The financial technology (fintech) industry has been rapidly transforming the way we manage, invest, and transact in the digital era. With innovative solutions ranging from mobile payment platforms to blockchain-based financial services, fintech has revolutionized traditional financial processes, bringing convenience and efficiency to consumers and businesses alike.

However, amid the dazzling potential of fintech lies a complex landscape riddled with fintech industry challenges and risks that demand careful attention and strategic planning.

In this article, we’ll discuss the most critical fintech challenges and risks in software development for 2025 and explore the ways they can be resolved.

Table of content:

FinTech Industry Market Overview
FinTech Risks and Challenges
Key Solutions for Risks and Challenges in Fintech Development
Wrapping Up

FinTech Industry Market Overview

According to the market outlook of Expert Market Research, the global fintech market was valued at over $135.90 billion in 2021 and is expected to increase to over $266.9 billion by 2027 at a CAGR of 11.9% over the forecasted period.

To get a better understanding of the current state of the fintech market and its potential areas of evolution, let’s review some of the key industry trends for 2025-2030. An excellent analysis has been provided in a comprehensive fintech research study by Allied Market Research. Based on this, the fintech market has been segmented on the basis of deployment mode, applications and technologies types, end-users and region.

Source: https://www.alliedmarketresearch.com

As for critical market technologies, data analytics remains the most essential segment for the upcoming decade. However, the fintech market also expects to evolve in artificial intelligence, application programming interface development and blockchain solutions.

picture of fintech risk in IdeaSoft Blog — Source: https://www.alliedmarketresearch.com

By 2030, the highest market share in the fintech industry will be generated by the banking segment. However, analytics also admittedly will show some notable investments from the insurance and security fields.

All these factors are actively guiding the development of fintech startups, as well as the overall market evolution.

FinTech Risks and Challenges

At present, there are plenty of risks and challenges of fintech associated with software development, each of which can significantly affect startups’ efficiency and their ROIs, and even hit the performance and development of their financial and banking business.

Below we’ve reviewed some of the biggest fintech threads that will remain relevant in the upcoming years.

Systems Vulnerabilities

The financial and banking industry is closely tied to sensitive and private data, so software security will remain one of the primary areas of focus for 2020-2030. Currently, more and more international regulators focus on system vulnerability problems in fintech industry and the rising number of security breaches, hacking attacks and third-party penetrations only confirms its importance in the fintech world.

For instance, just in Q1 of 2022, the NVD database published 8,051 vulnerabilities, which is about 25% higher compared to the same period in 2021. Moreover, according to Edgescan’s 2022 Vulnerability Statistics Report, the vulnerability risk of every 10th Internet-facing web application is considered a high or critical risk, and nearly 46% of apps today report notable vulnerability issues.

Digital Identities

A rising implementation of smartphones and contactless payments has uncovered the challenges of digital identity in the fintech technologies market. Currently, the key features to keep in mind for digital IDs in the financial and banking industry include:

Verified and trusted – digital identities are valuable if approved by authorities, regulators and other relevant stakeholders.
Portable – digital IDs need to fully replicate the functionality of physical documentation across multiple services.
Secure – digital IDs must feature extremely high security against loss, theft or corruption. Additionally, they must be encrypted to prevent compromise.

Data Ownership

Another important aspect that hits various businesses within and outside of the fintech and banking industry is the data ownership challenge. Typically, it regulates the parties who are allowed to access, create, modify, and delete different data.

In fintech software solutions, data ownership must be given by the security roles. This allows for efficient management of complex scenarios of access privileges and the level of access. As a result, this can significantly minimize the risks of third-party system breaches and potential data compromises, as well as numerous reputational and financial losses.

Ethical and Bias Concerns in AI

The use of AI-powered algorithms for financial decision-making raises ethical questions, particularly around bias and fairness. Fintech companies must develop transparent and accountable AI models, ensuring they do not inadvertently discriminate against certain demographics or perpetuate existing biases in financial services. Resistance to change or a lack of understanding of these technologies may impede their widespread adoption, delaying fintech’s full potential.

Fintech Security Concerns For Third-Party Service Integrations

Nowadays (and for upcoming years as well), APIs have become the foundation of nearly all modern applications. These enable a coherent and efficient performance of different apps, speed up the time-to-market and open up a wide range of opportunities for improving the functionality and competitiveness of a particular software.

However, the most critical risk for the implementation of third-party services for the fintech industry is their security concerns. According to BlueVoyant’s research, in 2021 over 93% of companies suffered a cybersecurity breach due to significant weaknesses in their supply chain/third-party vendors.

Additionally, having analyzed the API-related incident data, the researchers of Marsh McLennan Global Cyber Risk Analytics Center have discovered that the lack of security in APIs may cause $12 billion to $23 billion (US) and from $41 billion to $75 billion globally in average annual API-related cyber loss.

In terms of the financial and banking technologies industry, the insufficient security of third-party service integrations in fintech app risks the digital security of any company’s operations and data.

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Cloud Migration

When analyzing critical fintech challenges, it’s also worth mentioning the risks of cloud computing adoption for banks and financial institutions. Though experts claim increased efficiency and reduced costs, not all firms can successfully and safely integrate cloud solutions into their systems.

For instance, Forbes analytics highlight that adoption is not the issue. Instead, the key point is to find the most efficient and effective cloud solution which can replace the old on-premise systems and applications, and maybe even add to the company’s competitiveness after migration to the cloud.

Additionally, there are some common stereotypes about FinTech cloud migration, which make companies uncertain about its adoption:

Cost Estimation. Regardless of the industry, cloud migration costs are often underestimated, which results in notable cost overruns. A team of Dutch university professors has accessed the cloud migration cost of 10 “international corporate banks” and uncovered that 5 out of 10 banks experienced cost overruns (versus the expected estimates) in at least five categories. That included dependency management, third-party services, re-architecting, legislation and departmental support.
Data Management and Security. Data confidentiality and its protection implies properly aligning permissions, encryption and secure storage to restrict readability and comply with local regulations.
Integrity. Cloud solutions for fintech should feature the appropriate permissions for restricting data modifications or deletion.
Data Confidentiality. Since financial and banking institutions work with tons of sensitive and personal data, it’s essential to continually work on improving its protection to restrict its readability and user access, as well as to prevent the violation of existing regulations.

Though there are various aspects to consider in fintech cloud migration, its potential advantages can surely improve the performance and competitiveness of thousands of industry-related businesses.

Malware Attacks

During the 2015-2020 period, finance and insurance was the most targeted industry by cybercriminals. Moreover, research by IBM X-Force shows that in 2021 nearly 70% of the attacks on financial industry firms targeted banks, which means the risks for related companies to be attacked are extremely high and require exceptional attention.

The BCG report also uncovered that financial firms are 300 times more likely to fall victim to cyberattacks compared to other organizations, which is no wonder. In the case of a successful attack on a financial and banking institution, criminals can gain much more profit.

From a business owner’s perspective, the importance of keeping your company secure from ransomware attacks is one of the critical problems in fintech that cannot be overestimated. When infected by malware, a company can experience operational and reputational damage. At the same time, a cyberattack will inevitably lead to significant financial losses, which in some cases may result in bankruptcy.

Key Solutions for Risks and Challenges in Fintech Development

Having explored the major challenges related to fintech software development, the common question of any business owner is how to successfully reduce the risks of being affected and quickly recover if any of these issues emerge.

Let’s review the advanced solutions for fintech software development that are widely incorporated in the financial and banking industry today.

Adopt a Secure-by-Design Mindset

Previously, we’ve listed a bunch of risks and challenges in fintech software development, most of which were related to the system’s security concerns. For this reason, one of the first items to introduce into fintech development is the implementation of a secure-by-design mindset.

This implies investing significant resources in building a robust cyberattack defense infrastructure to reduce the penetration risks and decrease the costs for infrastructure recovery. Additionally, a secure-by-design mindset will allow for the creation of an ecosystem that encompasses the right skill sets and capabilities to enhance security, not only on a corporate level but even for the security of the state. For instance, this practice has been already implemented in Singapore, the US and the UK and some European countries.

Protecting Sensitive User Data

This approach implies working on the security of the data storage environment, which must be accessed only by authorized users according to permission level. Also, fintech developers should constantly update the security protocols and check for potential vulnerabilities (for instance, through the pentest) to ensure data is secured 24/7.

However, one of the required measures for protecting sensitive client data in financial and banking (as well as most other industries) is data encryption. Basically, it’s the process of transforming data into an alternative format that can only be read by a person with access in a decrypted way.

Penetration Testing for Escaping Malware Attacks

At present,. pentest remains one of the most efficient practices for keeping ahead of attackers and consistently working on security improvements. An advanced team of cyber experts with notable expertise in penetration testing can efficiently examine your system for potential threats and vulnerabilities, which plays an irreplaceable role in troubleshooting security issues.

Moreover, these professionals can help not only optimize existing fintech systems but can also collaborate with QA specialists to ensure the robust performance of the particular project before its official release.

DRP/BCP Analysis in Fintech

Fintech companies should not only work on potential threats but also consider efficient and effective algorithms on how to act if a specific incident occurs. That’s where the BCP (Business Continuity Plan) comes into play. Its goal is to outline proactive measures to ensure the continual availability of business support systems and to mitigate the disruption risks as well. Typically, the BCP covers the following components:

Emergency Response – a plan of action for responding to emergency cases, targeted on preventing a disaster or minimizing its outcomes
Crisis Management – a set of rules to be followed when reacting to critical incidents in a timely manner, when all previous efforts have failed for some reason
Disaster Recovery – a guide for leveraging advanced technologies and solutions to eliminate the outcomes of a particular incident based on detailed case analysis. In other words, it implies setting up a second line of defense aimed to bounce back from the worst disruptions with minimal damage.
Business Continuity – these are steps on how to maintain critical business processes and functions after an emergency or disruption.

The end goal of the BCP is to ensure the organization is capable of responding and recovering from potential threats as efficiently and effectively as possible.

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Using Software Composition Analysis (SCA)

SCA is the automated process that identifies the open source software in a codebase, which basically helps companies evaluate system security, code quality and license compliance.

Fintech developers usually apply SCA to proactively identify problems and consider actions on how to successfully remediate them to avoid reputational, operational or monetary impact on a particular company.

Implement Safe & Secure Third-Party Service Integrations

Since third-party tools can provide cybercriminals with a clear and easy path to access internal company’s systems, financial and banking institutions need to only use trusted licensed software to mitigate risks. Additionally, companies can consult with cybersecurity specialists to understand the security flaws of a particular third-party partner and consider the most efficient strategies to allocate sensitive resources which will not compromise the safety and security of your fintech solution.

Involve DevSecOps for Cloud Migration

DevSecOps (development, security and operations) experts can significantly improve the performance and safety of applications by integrating the latest security practices and approaches across every stage of fintech software development. Basically, they allow software security to be transformed into a fundamental component of a production pipeline through a detailed software composition analysis.

Analyzing the potential benefits of this practice implementation, it’s no wonder that nearly 91% of financial companies have implemented or are currently working on the DevSecOps practice implementation (Sonatype).

Wrapping Up

There are many aspects to consider when developing fintech software solutions, which is why a considerable number of startups fail. Nevertheless, being aware of the potential risks and challenges in fintech development, and choosing an expertized technical provider can significantly increase the chances of launching a solid and efficient software solution that ideally works for your business’s needs and objectives.

Being a reputable fintech product development company, IdeaSoft has successfully delivered over 250 projects with outstanding products, modern systems, and emerging technologies on board, including dozens for the financial and banking sector. Do you already have a fintech project for us? Contact our team to explore development strategies for an efficient fintech solution and how your business can benefit from them today!

How to Monetize Your Mobile App

In 2020-2021 mobile apps broke all records because the COVID-19 pandemic brought new users and revenue growth to them. According to an industry overview by Statista, the total number of mobile application first-time downloads worldwide is expected to grow to 230 billion by 2025. It’s no surprise that app creators are trying to get the most out of their products and monitor them. In this article, we’ll look at how to monetize a mobile app.

What is mobile app monetization?

Mobile app monetization is the process of making money with an app. You can convert users into revenue using a variety of app monetization models, including advertising, paid subscriptions, in-app purchases, and others. Most branded apps are designed to increase users average order value (AOV) or number of purchases.

The best mobile app monetization model depends on the specifics of the software product. You can read our mobile development guide to better understand mobile app specifics. For example, gaming apps are better suited for in-app purchases that allow users to get extra tries, special features, or move to the next level without waiting. At the same time, language learning apps can generate revenue through both paid subscriptions and advertising.

If the monetization process is set up correctly, it will generate revenue even on a free apps. So, how do app creators make money?

How to monetize a mobile app?

At the early stages of development, you need to consider different monetization strategies for a mobile app and choose the most relevant ones for your app. Below you can find 5 of the most popular ways to monetize mobile apps.

The In-app advertising model

This is the most popular app monetization model – users willingly download free applications. App owners make their profits by showing ads. The main goal of such a strategy is to make it accurately targeted and useful. To do this, it is necessary to collect user data: location and in-app behavior. Frequent, intrusive ads annoy users – you have to find a balance between the quality and quantity of ad impressions.

In-app advertising model disadvantages:

Adblocking. If the user has an ad-blocking app installed on his or her phone, advertisers will be left at a loss.
Annoyed users. Nobody likes banners and pop-up notifications that distract from the app.
If ad placement is poorly implemented, it can detract from the user experience in the app.

This monetization model is right for you if:

Your app doesn’t have organic shopping opportunities.
You regularly collect data about user preferences.
Ads won’t ruin the UX of your app.

Example: Shazam. At first, Shazam made profits by providing a service: after recognizing music, the user would get links to the iTunes or Spotify stores. Today the service earns money from in-app mobile advertising and TV ads that users recognize through Shazam.

Freemium (free app with the ability to unlock additional features for a fee)

Freemium provides users with a free application with basic functionality. But how can someone monetize a mobile app with this model? Everything is simple: more features are available to the user for an additional fee. The success of this strategy depends on the number of loyal users in the app who are willing to pay for the additional features.

Freemium model advantages:

It can be used in all types of apps.
No usage barrier.
It is easy to get a large user base.
Users of freemium apps don`t expect perfect service and commitment.

Freemium model disadvantages:

The free version can’t always demonstrate the benefits of the full app and motivate the user to buy.
There is a risk that there will be more non-monetized users than those who pay.

Example: Tab Pro by Ultimate Guitar USA LLC. This app is a tablature database with many useful features for guitarists. The developers of Tab Pro use two methods of monetization: a monthly subscription and a one-time purchase of additional features. Periodically, the user is offered the full version of the mobile app for purchase at a discount for a limited time.

In-app purchases

Any app could have some extra content and features — including digital goods, subscriptions, and premium content for fee. Many in-app purchases are optional or give users additional features; others serve as subscriptions and require users to sign up and pay a fee to use the app, often after an initial free trial.

There are four types of in-app purchases and you can offer multiple types within your app.

Consumable. Provide different types of consumables, such as lives or gems used to further progress in a game, or boosts in a dating app to increase profile visibility. Consumable in-app purchases are depleted as they’re used and can be purchased again. They’re frequently offered in apps and games that use the freemium business model.
Non-consumable. Provide non-consumable, premium features that are purchased once and don’t expire. Examples include additional filters in a photo app, extra brushes in an illustration app, or cosmetic items in a game. Non-consumable purchases can offer Family Sharing.
Auto-renewable subscriptions to provide ongoing access to content, services, or premium features in your app. Users are charged on a recurring basis until they decide to cancel. Common use cases include access to media or libraries of content (such as video, music, or articles), software as a service (such as cloud storage, productivity, or graphics and design), education, and more. Auto-renewable subscriptions can offer Family Sharing.
Non-renewing subscriptions to provide access to services or content for a limited duration, such as a season pass to in-game content. This type of subscription doesn’t renew automatically, so users need to purchase a new subscription once it concludes if they want to retain access.

Paid applications

It is the easiest and most understandable option for monetizing mobile apps. On Google Play, the minimum price of an application is around $0.26, and the maximum price is around $400. Novice app owners start calculating the profit from sales even before the project is launched. In reality, an app needs to get into the top 200 paid apps to get enough attention and be noticed.

Paid application model advantages:

You can earn 70% of the app’s price in app stores.
No ads interfering with users.
If a user buys an app, it is more likely that they will use it regularly.

Paid application model disadvantages:

High level of competition.
A large number of popular free apps.
Significant investment is required to get to the top.

Example: Noisli. This application helps users relax or focus on work with the help of sounds from nature and color combinations.

Subscription

This app monetization model involves selling useful content in the app. The user gets access to information of interest after subscribing. The content for sale can be any object within the app: movies, books, news, music, educational videos.

There is another variation of this app monetization model – subscription with a trial period. In the aforementioned Tab Pro, a subscription is issued after a seven-day trial period. This strategy allows users to test the features before deciding to subscribe.

Subscription model advantages:

If the user is willing to pay for content, they are more likely to become a regular subscriber and user of the app.
Ease of distribution.
More reliable and consistent revenue stream.
A pro-consumer focus.

Subscription model disadvantages:

High costs to keep the server part running.
This way of monetization is suitable for highly specialized and niche applications.
Unguaranteed revenue stream.
Additionally, web3 apps to earn money offer innovative monetization avenues for app developers.

Whichever way you choose to monetize, remember that the app needs to be relevant and user-friendly. Only then will it find its users and bring profit.

Android app monetization models

Google Play is the largest app store, with hundreds of games, books, music, and movies in its catalog. At the moment it is 2.5 times bigger than the AppStore. Half of all smartphone owners in the world are potential users of any mobile app. So Android app monetization is more profitable than iOS app monetization.

Thanks to Google Play, everyone from large companies to private developers has an opportunity to showcase and monetize their apps. The market’s huge traffic allows you to monetize through ads, in-app purchases, subscriptions, donations, and DLC content.

Balloon Island, for example, has published more than 10 free puzzle games in Google Play that generate revenue through advertising monetization. This company is among those who have made making money on Android apps a very lucrative proposition. At the same time, Blood Pressure makes money using two methods at once: in-app ads and in-app purchases. Play Market gives you the freedom to combine different ways to monetize mobile apps.

iOS app monetization models

On the iOS platform, banner ads and video rewards generate the most revenue. In turn, Android wins in terms of income from pop-ups. The LTV (Life Time Value) of iOS users is higher than that of Android users. The average in-app purchase price is $1 for iPhone users and $0.47 on the Android platform. AppStore customers are much more willing to spend money and make in-app purchases.

In other words, the average iOS user is more statistically more solvent. In terms of net profit, it is more profitable to start with the development of an iOS app.

Statistics also show that iOS users make purchases from smartphones more often (23%) than Android users (17%). E-commerce app revenue per user on iOS is about $20 vs $11 on Android. This difference is explained by the fact that the purchasing power of Apple customers is higher.

Comparison of solvency of iOS and Android users

Wrapping up

There is a lot of money in the mobile app industry today. While gaming apps are still the market leader, developing apps that help you clean out your closet and know what foods are in your refrigerator are also relevant.

The market offers inexhaustible opportunities for innovation, but it’s important to find ways to monetize them. And now you know how to monetize a mobile app. Explore monetization strategies and think about which one will be most effective in your case. You always have an opportunity to try different monetization strategies for a mobile app and then act on what you’ve learned.
If you are planning to develop a mobile application, you can order mobile design or full mobile development services from our experienced IdeaSoft team. Feel free to contact us to discuss your mobile application development.

Key Insurance Technology Trends in 2025

The insurance industry has changed significantly in recent years, taking a step towards digitalization. Improving agility, customer focus, the introduction of advanced technologies, and the emergence of new market players made it one of the high-growth industries in the world. Research by CB Insights confirms this by claiming that insurtech funding has increased by 60% in the US over the past 3 years. But where will this budgeting go and what to expect next?

Let’s figure out what the future holds for insurance and what are the key insurance technology trends in 2025.

COVID-19’s impact on the insurance industry
Insurance technology trends that are shaping 2025
2.1 Implementation of AI-based solutions in insurance
2.2 DLT and blockchain in insurance
2.3 New user experience with mobile apps
2.4 Cybersecurity insurance
2.5 Predictive analytics in insurance
2.6 The rise of InsurTech
The bottom line

COVID-19’s impact on the insurance industry

Covid-19 has burst into our lives and changed our reality. However, at the same time, the lockdown accelerated the digitalization efforts of companies and forced them to take a closer look at the needs of their сustomers. The insurance industry is no exception. According to Bain&Company’s survey, digital adoption in insurance grew 20% globally over the past year.

Annual growth rate in digital adoption for insurance — Source: Bain Customer Loyalty in Insurance surveys

Digitalization has affected the entire insurance policy cycle, from filing claims to servicing digital policies. A TransUnion poll showed that almost half of respondents prefer issuing policies and communicating with insurance providers using online tools such as websites, mobile apps, and email. Plus, under lockdown, insurance companies were forced to look for new digital ways to stay in touch with their customers. Both parties are positive about technology engagement, as digitalization improves many processes for both insurers and the insured. For example, automatic status updates reduce inquiry calls, and digital apps reduce the number of incomplete forms. Automation will also enable companies to lower costs and offer customers more streamlined and personalized services.

Insurance technology trends that are shaping 2025

Insurance tech trends have a lot in common with fintech trends, since both industries are related to providing financial services. Technologies such as artificial intelligence, blockchain, and mobile are becoming the basis for creating the most advanced insurance software solutions.

Implementation of AI-based solutions in insurance

When we talk about the main technology trends of our time, artificial intelligence comes first. Usually, businesses use AI to conduct operations in a faster, cheaper, and more accurate way. In insurance, this technology has the potential to make almost anything from customer service to fraud prevention more efficient. According to Juniper, total insurance premiums generated by AI will reach $20.6 billion in 2024.

Today’s insurance companies are using AI to better analyze data and deliver more personalized services based on it. With this technology, a company can gain access to customer data through smart devices, location-based sensors, site sensors, and geographic information systems. This way, insurance companies can take into account the characteristics of each individual client and create flexible contracts that meet the needs of the client. For example, by analyzing vehicle telematics data with machine learning algorithms, insurance companies use AI-based solutions to create personalized risk profiles for drivers. Chatbot implementation will also enhance the user experience by making it possible to process submissions, check details, and perform other common operations much faster.

According to AllTheResearch, the global artificial intelligence in the insurance market ecosystem is expected to reach $4.5 billion in 2026. Leading insurance companies already use AI technology for insurance claims, payments, claims analysis, asset management, risk calculation, and more.

DLT and blockchain as one of the insurance technology trends

Blockchain is another widely debated technology. Its advantages, such as transparency, security, and immutability, make it attractive to many industries. For insurance, blockchain is an excellent tool that can help insurers reduce the administrative costs associated with handling claims and verifying payments made by third parties. Blockchain provides data sharing and, at the same time, strong protection against fraud. All information in the distributed ledger is recorded as blocks linked to each other. This provides traceability, which helps simplify inspections. Cryptographic protection methods make the technology highly reliable for data storage and transmission.

Accenture reports that the global market for blockchain technology in insurance will grow to $1.39 billion by 2023. According to MarketsandMarkets, at this time, the distribution of blockchain solutions by directions will be as follows:

distribution of blockchain solutions by directions — Source: MarketsandMarkets report

The medical industry uses smart contracts on the blockchain to quickly verify reinsurers and insurance history, thereby reducing frequently asked questions and lower administrative costs. Self-executing contracts can also provide peer-to-peer insurance where it is much easier to receive claims and where the return of all remaining funds to the pool members is guaranteed at the end of the coverage period. Companies like Lemonade and Guevara already offer similar systems to their customers. New approaches to insurance based on blockchain technology will help to meet growing customer expectations for increased privacy, more innovative products, and competitive pricing from their insurers. Therefore, blockchain development is in great demand among insurance companies.

Better user experience with mobile apps

A modern person cannot imagine life without smartphones, as this is a convenient way to solve many issues, from communication to shopping and making payments. According to Statista, global mobile app revenues will grow to $935.2 billion by 2023. With such rapid growth, the insurance industry simply cannot ignore mobile apps. J.D. Power’s study shows that 74% of insurers have a mobile app that allows policyholders to access and manage their policies and claims information on the go. Moreover, customers who use mobile apps have been shown to experience greater satisfaction than those who use desktops or mobile browsers to interact with their insurance companies.

Mobile app development for insurance is especially popular for the last couple of years. With the help of a mobile app, clients can independently issue an insurance policy in a few clicks or receive an online consultation. Plus, mobile applications provide continuous communication with customers, allowing the collection of information about users and offering them personalized offers. For example, companies such as Allstate Drivewise and GEICO have created mobile apps that make it quick and easy to submit a claim, pay and manage bills, and manage claims using a smartphone. Allstate Drivewise also enables clients to submit a quick photo claim and speed up the request review process.

Cybersecurity insurance

Unfortunately, the past year of uncertainty and isolation has created favorable conditions for the growth of cybercrime. Coalition, one of the largest cyber insurance providers in North America, saw a 260% increase in ransomware attacks among policyholders in the first half of 2020 alone. As a result, cybersecurity insurance received more demand for covering a business’s liabilities in the event of a data breach involving sensitive data. According to P&S Intelligence, the cyber insurance market will grow from $5,573.2 million in 2019 to $70,671.9 million by 2030. Munich Re also expects the global cyber insurance market growth and predicts it to reach a value of more than $20 billion by the year 2025.

Growth in ransomware damage — Source: Cybersecurity Ventures

According to statistics, the greatest demand for cyber insurance comes from the most attacked industries such as IT, healthcare, manufacturing, financial, and service companies. In addition to investing in cybersecurity insurance, experts also insist that companies develop their own cybersecurity programs to prevent fraud. Therefore, overall investment in cybersecurity software solutions will also increase.

Predictive analytics

The development of predictive analytics systems is on the rise. By collecting customer data, insurance companies better understand their customers’ needs and can provide better services to them. Along with increased user satisfaction, this approach allows companies to achieve more accurate risk assessments and stable profits. Insurance companies can collect data from customer interaction systems, telematics, agent interactions, smart homes, and social media to better understand and manage customer relationships. COVID-19 has shown insurers that the ability to predict changes can help them effectively identify and enforce rate changes and new products.

Identifying customers at risk of cancellation, determining claims that don’t meet requirements, predicting the risk of fraud, identifying potential sales markets, and providing a personalized user experience are the benefits that a company gains with effective analytical tools. In this context, AI becomes an excellent solution, as it allows you to quickly process large amounts of data and provide the best solutions for customers.

The rise of InsurTech

The development of InsurTech is worth mentioning separately. According to ResearchAndMarkets.com, global InsurTech market revenue is expected to reach 10.14 billion by 2025, growing at a CAGR of 10.80% during the period 2019-2025. While traditional insurance companies are working hard to digitize their services, they find it difficult to transform established systems and introduce new technologies quickly. Against this background, the emergence of young tech startups looks more progressive. Especially in isolation, when insurers are focusing their efforts on digitalization. So it’s not surprising that according to the World InsurTech Report 2020, 67% of insurers want to collaborate with InsurTechs.

Most of the insurance industry will move to InsurTech in 2022, experts predict. All retail insurance products, whether life insurance or other products, will be digital, and auto insurance will have technologies that will dramatically change the current landscape. According to Deloitte, InsurTech investments in the first half of 2020 look as robust as they did last year when raised funds hit a record high. So this year we can expect a rapid development of the industry.

The bottom line

Covid-19 has largely created favorable conditions for the development of the insurance industry, accelerating the process of technology adoption and digitalization of insurance services. Experts predict an active transition of insurance companies to InsurTech in 2025. Technologies such as AI, blockchain, and mobile will be on the rise. To stay competitive in the market, insurance companies will apply them to personalize their services and meet the needs of customers. It is difficult to say how quickly the insurance industry will be able to transform and meet the requirements of the new normal. Probably 2025 will clear things up. One thing is certain, modern insurance companies need effective innovative software solutions that will help them grow.

Top 5 Blockchain Development Platforms for 2025

In today’s digital world, different blockchain development platforms offer a variety of tools and features to build secure, scalable solutions. Whether you’re creating decentralized apps, smart contracts, or enterprise-level blockchain systems, understanding the strengths of these platforms is essential for choosing the right one for your project.

In this article, we will provide a quick overview of the top 5 blockchain platforms and explain what to look for when choosing a blockchain for your business.

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Ethereum

Starting with Ethereum would probably be the right decision as this network is one of the top blockchain to build dapps and hundreds of developers around the world consider it one of the best development platforms for blockchain. Introduced in 2013, Ethereum has exploded in popularity thanks to the support of smart contracts and decentralized applications (dApps) that unleash the full potential of blockchain technology.

The main features: Ethereum is a public open-source platform working on the principle of Proof of Work. It provides engineers with a wide range of tools to build blockchain-based solutions using the Ethereum Virtual Machine environment. Ethereum has its own programming language called Solidity and its cryptocurrency Ether, which is used within the Ethereum network for executing transactions and running apps. According to the Ethereum Price, the market value of one ETH at the end of May 2021 was $2,236 which makes Ether the second most valuable cryptocurrency on the market after Bitcoin.

Strong and weak points: The strengths of Ethereum are its high level of security due to decentralization, very little downtime, versatility and a huge community. Of course, there are weak points as well. For example, slow processing times and higher transaction costs compared to other platforms, as well as scaling issues. However, it’s worth noting that the Ethereum team is working on troubleshooting. For example, in 2021, the platform partnered with Polygon, which aims to create Ethereum-compatible blockchain networks. Also, Ethereum is currently undergoing an update known as Ethereum 2.0, which will operate on the Proof of Stake (PoS) principle to improve security and scalability and make gas calculations more efficient.

Use cases: With the rise of DeFi in 2020 and NFT in 2021, which were directly related to Ethereum, the demand for the network has grown even more. The variety of Ethereum-based projects is impressive. Beyond finance, Ethereum is leveraged for a wide range of applications, including voting systems, secure storage of medical data, gaming, and social networks. Many users choose Ethereum or Binance for DEX due to their robust features and growing ecosystems. With its growing portfolio of successful projects and constant technological advancements, Ethereum is poised to remain one of the most promising blockchain development platforms in the years ahead.

Polkadot

Polkadot is a relatively new but promising blockchain platform created by Gavin Wood, one of the co-founders of Ethereum. Since August 2020, the Polkadot token has risen in price by 1238%, and the platform itself has become a noticeable player in the market.

The main features: Polkadot is a technology designed to create a multi-blockchain network with fully decentralized information exchange. In this environment, developers can create new blockchains, as well as connect existing ones. Polkadot’s unique architecture that includes parachains allows you to take permission data from a private blockchain and use it in a public blockchain. It has every chance of becoming one of the best blockchain development platforms in the coming years as it solves the problems of scalability and interoperability of blockchains.

Strong and weak points: Polkadot provides many benefits to both blockchain developers and users. First, the network enables fast and secure processing and transmission of data between public and private blockchains. The platform is highly scalable and functional. Secondly, it opens up new opportunities for developers of decentralized applications. For example, by providing a single framework for building protocols, Polkadot allows individual blockchains to rely on common security features. Many blockchain experts see Polkadot as a revolutionary solution that makes the concept of a unified blockchain network more realistic than ever.

Since Polkadot is a fairly new project, it has few use cases to fully appreciate the effectiveness of the technology. Some also criticize it for the lack of decentralization through a concentration on its own DOT currency.

Use cases: Polkadot is primarily focused on crypto projects including DeFi and NFTs. In 2020, it partnered with the Chainlink project to attract DeFi app developers. The platform supports the creation of transaction chains, IoT chains, oracle chains, identification chains, data distribution chains, etc. Interest in the platform continues to grow, and we are confident that new promising projects in the Polkadot ecosystem are yet to come.

Solana

Another popular name in the blockchain world and one of the best platforms to build blockchain, according to many developers is Solana. This blockchain is one of the largest in DeFi in terms of the number of blocked funds.

The main features: Solana is quite different from other platforms. This is a first-level blockchain with no sidechains or parachains. The platform is open-source and decentralized. It has its own cryptocurrency called SOL. Solana blockchain nodes are rewarded for processing transactions with SOL, and unlike many other blockchains, it doesn’t have the minimum amount of coins required to create a node. Solana uses a new cryptic mechanism called Proof of History (PoH). It allows for greater scalability and faster transaction processing. According to representatives of the Solana Foundation, the current throughput of Solana is 60,000 transactions per second.

Strong and weak points: Solana’s main advantages are not limited to the speed and cost of transactions. The platform also provides excellent scalability and compatibility between projects. It also offers a pretty good user experience that many decentralized projects lack.

Solana is a fairly young blockchain framework, so it has not yet gained widespread adoption and many projects are yet to come. Many functions work in test mode, which means system crashes are possible. Also, some developers criticize the blockchain for not being decentralized enough. Despite this, Solana has great potential and many advantages over Ethereum, for example.

Use cases: Although Solana has been on the market for a while, a real boom of this technology was seen in 2021 with increased interest in NFTs. Minting NFTs on Solana is cheaper and faster than on Ethereum, so users who appreciate the platform and many projects related to non-fungible tokens chose it for further development. You will also find enough DeFi projects built on Solana, including wallets, DEXs, and stablecoins. According to various data, over 200 companies are currently included in Solana’s ecosystem.

Also, the network continues to evolve. In 2020, the Solana Foundation was created to support the development of the ecosystem. For this, the foundation received 167 million SOL coins from Solana Labs. Also, in October 2020, Solana developers created a cross-chain bridge with Ethereum that allows for the transfer of assets between two blockchains.

Cardano

Cardano has a high degree of fault tolerance, decentralization, excellent transaction speed. These are all great aspects of Cardano. In 2021, the blockchain cryptocurrency called ADA ranked third in terms of market capitalization, behind only the market leaders Bitcoin and Ethereum. With such successes, we cannot fail to include Cardano in the list of the best blockchain development platforms.

The main features: Cardano is an open-source proof of stake blockchain platform. It has a layered architecture and an internal cryptocurrency called ADA. Cardano works on the Proof-of-Stake principle, which is based on the analysis of the amount of cryptocurrency. The platform provides smart contract functionalities. What’s most exciting about Cardano is that it’s highly decentralized. In 2021, the platform reached 100% decentralization, and currently, the network has more than 1500 validator pools.

Strong and weak points: Cardano is powerful and scalable. It provides faster and cheaper transactions than the Ethereum network. Another feature that attracts users is the possibility of passive earnings by staking ADA coins. The platform has a focus on security. The Cardano protocol called Ouroboros has mathematical proof of the persistence of the system even if the nodes temporarily go offline due to a computer failure or power outage, for example. The system is extremely stable thanks in large part to good decentralization.

Cardano is known as an ‘academic blockchain’ because its development is based on a lot of research and tests. On the one hand, this provides more network trust, but on the other hand, it slows down the speed of the platform’s development. Much of the criticism is connected with this since the market is quite competitive and the speed of emergence of improved solutions is crucial here.

Use cases: Cardano is primarily focused on building smart contracts, decentralized applications, and sidechains. The platform also supports NFTs, which propelled it to the top blockchains of 2021. Currently, DEXs, NFT marketplaces, stablecoins, lending protocols, and others are being developed using Cardano.

The Cardano team has a clear road map for improving the technology they use. In the near future, the platform is expected to receive a number of updates that can make it an even more attractive solution for the development of blockchain projects.

How to choose a blockchain platform for your business

Now that we have discussed the list of different blockchain development platforms, let’s move on to the question of how to choose the right technology solution for your business. When choosing a blockchain for your project, you should pay attention to those factors that are important to you and meet your business needs. These factors can include:

Confidentiality level. If your company has strict security and privacy requirements and you want to build an enterprise blockchain, you need to consider private platforms such as Hyperledger Fabric. If the goal of your business is to create an open project with a high level of transparency, choose among the public networks.
Security. Security always matters. Different blockchains have different mechanisms to ensure the secure storage and transmission of data.
Decentralization. More and more users and businesses are discovering the benefits of decentralized solutions. Decide what level of decentralization your project needs and what platform can provide this.
Transaction speed and cost. These factors are decisive for many users when choosing blockchain applications. If you decide to work with a platform with a high gas fee, your development team will need to think about how to optimize it.
Scalability. It all depends on your business plans and the expected load on the system. Make sure the platform you choose can handle a growing amount of work while delivering strong performance.
Adoption rate. Last but not least, when choosing a blockchain development framework. The more popular a platform is, the more likely it is to attract more users with less effort. If this is your goal, study the popularity of different platforms in the market and how successful they are.

Also, we advise you to always consult with experts who will be able to assess your requirements and suggest the best solution. By working with different frameworks, experienced blockchain developers can easily determine which platform is most likely to meet your needs.

Final thoughts

The blockchain market is evolving at an incredible rate. In addition to constantly updating existing solutions, new and more advanced ones are constantly appearing. When choosing a blockchain development platform for your business, you should pay attention to both the functionality of the blockchain and its history on the market because, with proven solutions, there are always more opportunities to achieve success.

Also, to successfully launch a crypto project, you need not only to choose the right framework but also to find the right development team capable of unleashing the full potential of the technology.

IdeaSoft has been offering blockchain development services for clients around the world for over 5 years. Our team works with major blockchain frameworks and is a partner of Skale, an Ethereum-compatible network for building powerful dApps.

The company’s portfolio includes more than 250 successfully implemented projects, including DeFi wallets, NFT marketplaces, DeFi aggregators, lending/borrowing platforms, identity management solutions, and crypto exchanges. Additionally, we specialize in DePIN platform development, ensuring that your business leverages decentralized physical infrastructure networks for enhanced scalability and resilience.

Feel free to contact us to discuss your next blockchain-based project. We would be happy to be a part of it!

How to Structure a Software Development Team

Project development success depends on many things such as strategy, planning, and investment. Of course, these are important, but all projects start with people. That’s why you need a carefully selected team of software developers and well-functioning development processes. The dream of every business is to create a mechanism that works like a Swiss watch and requires minimal intervention, and a cohesive team is a reliable foundation for successful project development. In this article, we’ll tell you how to structure a software development team as well as describe the typical team composition for a software development project.

The main roles within a software development team

The structure of a development team depends on many factors since the team members are selected for each individual project. However, there are some roles that form the basis of such a team. Before getting into the question of how to structure a software development team, it is necessary to know the main roles in a software development team and their areas of responsibility.

Project Manager (PM)

A PM is responsible for the initiation, management, and delivery of a project. This specialist acts as a bridge between the development team and the product owner team. Project work starts with the Project Manager, it is managed (tasking), controlled (quality and efficiency control), and delivered to him/her. In most companies, PMs also manage the project fund.

Business Analyst

Business analysts communicate with customers and find out their needs and requirements. The task of the business analyst is to understand what the customer wants, how he or she sees the product that a development team needs to build, the product’s purpose, and what tasks it will solve. When communicating with the customer, a business analyst can offer them ideas on how to improve the product and form the project vision together with the customer.

Developers

Software developers are engaged in the production of software products. Basically, these are specialists who write the code and carry out the technical implementation of the project idea. The number of developers on a team depends on the complexity of the project and the scope of work. This is the executor’s role: a project manager sets a task to automate a process, and developers fulfill it. Developers are segmented by division of responsibility:

Backend developer – developer of the software and hardware part.
Frontend developer – developer of the client-side of the user interface.

Developers are also segmented by platform, e.g., web developers, mobile developers, server-side developers, and so on. Different types of projects require different developers, so there is no single rule to determine which programmers belong on any given team.

Team Lead

He or she is responsible for the work of the group of specialists. The team lead provides a comfortable working environment for the team and maintains a high level of its efficiency. This person doesn’t necessarily have to be a programmer, he or she just has to know how to organize the work as well as to understand the processes of the software creation.

The role of the team lead should not be confused with the role of the tech lead. The tech lead is a technician responsible for improving technical solutions. This role involves deep immersion in project architecture and technology to optimize operations and reduce technology risks.

UX/UI Designer

This specialist is responsible for the production of the graphical components of user interfaces. A designer develops the visual portions of the interface while taking into account the logical user interaction with the product. The skills of the UX/UI designer determine not only the look and feel of the software product but also how easy it will be to navigate as an app or platform. The main goals of designers are to establish the intuitiveness, simplicity, usability, and aesthetics of the software interface.

Quality Assurance (QA)

No software product can be created without testing and quality control. This is where QA specialists come into play. QA deals with the testing of everything, no matter how strange it may sound. This includes testing the developed functionality, security, compatibility, system vulnerabilities, and much more. The system approach of a QA specialist examines both the program code and the thoughtfulness of the user experience maps.

How to structure a software development team

Now let’s talk about the basics that will help you to find out how to structure a software development team. These factors directly affect the team composition as well as its size.

A structure of software development team

Choose the kind of team type your project needs

What is the best way to organize a software development team? First of all, it is necessary to choose the kind of team your project needs. There are three main types of development teams you can choose from:

Team of generalists – developers that possess a broad range of knowledge and expertise and can handle end-to-end solutions.
Team of specialists – developers who are highly skilled in a particular field that use all their knowledge and expertise, which results in more efficient and effective work.
Hybrid team – a team of junior, middle, and senior developers that combines the best from the generalists and specialists.

Software development team composition depends on the product that needs to be developed. Also, the size of the team depends on the complexity of the development and the deadlines. The more complex and faster the project needs to be delivered, the larger the team needs to be, and vice versa.

You should pay special attention to the level of seniority and expertise of the team. For example, if you are looking for a blockchain solution, make sure the selected developers have experience in this area and a sufficient number of specialists that are ready to implement your project on time.

Read our article: “How to choose blockchain developers?”

Define software development team size

How should you build a software development team and what is the optimal size of the team? These simple questions point to one of the primary concerns that arise when building a development team, but there is no definitive answer.

The size of the software development team depends on:

Complexity of the project
Budget
Deadline
Available resources
Full or part-time employment

As Scrum methodology shows, the optimal team size is between 3 and 9 members with 7 being the most perfect fit for software development. But if you need a bigger team, it’s okay. The key here is to carefully manage your crew following your project requirements.

As the size of the team increases, the number of interactions between team members increases proportionately. As the simple mathematical relationship proves: the number of possible personal interactions between “n” members equals n*( n – 1)/2. For example, on a nine-member team, the number of possible interactions for each member is 36, while on a four-member team the number of possible interactions is only 6. So, make sure your development team is in good hands and the process is set up correctly.

Also, read our article: “How to reduce software development costs.”

Select the right specialists

The effectiveness of the team depends largely on the personal qualities of its members and the relationships between them. Each team member should be prepared to apply his or her abilities and knowledge to the tasks of the team.

That is why the requirements of the work to be done should be carefully analyzed beforehand. This determines the level of competence, which includes the knowledge, skills, and personal qualities that team members should possess. Understanding the full list of tasks will allow you to assemble the perfect combination of specialists of the required level of seniority and skills.

Set clear goals and objectives

All team members must be aware of the connections between goals, working methods, and objectives. Goals should be clear, and focused, and create a vision of the work plan that will lead to success.

In order to clearly set and solve project tasks, it is necessary to consider a variety of expectations. A software development team’s goals should be the foundation of its operations, but significant external factors may cause them to be revised. This is why we advise you to use agile development methodologies and draw up detailed work plans, including software development specifications and more.

Final thoughts

A good development team includes everyone we’ve listed in this article: a project manager (PM), a business analyst, backend and frontend developers, a team lead, designers, and quality assurance (QA) specialists. To choose the best team members, you should define team type (generalists, specialists or hybrid) and then its size which depends on the complexity, budget, deadlines, available resources as well as full or part-time employment of the members.

You should also clearly set goals and objectives to give team members an understanding of what they will do. Knowing the technological stack, you can discuss the team composition with a software development provider.

Here are a couple of final tips:

Discuss the number of specialists needed (remember that 10x developers won’t make the development process 10 times faster).

Decide on the qualification of the team members (you obviously don’t need only senior developers and in most cases it is a waste of money).

Do not forget to put at least one senior developer on the team to lead them (it is mandatory to check the team lead’s hard & soft skills).

Work with a project manager. They are the main coordinators that help resolve all work-related issues.

Summarizing all of the above, it is worth noting that the software development team consists not only of developers but also of other specialists responsible for the different stages of software product creation. We hope this article was useful for you and now you have a clear idea of how to structure a software development team and all of the particulars of this process.

Banking Technology Trends to Watch in 2025

The coronavirus pandemic has changed all areas of our lives, and industries were forced to respond to the new needs of society. Many of these needs are related to payments and other banking services. Banking is one of the fundamental areas that affects all the others. Therefore, whatever industry you work with, you should be aware of the top banking technology trends. In this article, we have compiled the main banking tendencies for 2025.

Banking market outlook

According to Deloitte insights, in Q2 2020, the top 100 US banks had provisioned $103.4 billion in net loan losses. COVID-19 pandemic harmed the industry, and it not only stopped the growth of the segment but also had a significant impact on banking technology trends. For example, more banks started to adopt blockchain and artificial intelligence as well as transfer all banking processes online. There are many reasons for this.

First, the COVID-19 pandemic created the conditions of forced and rapid digitalization. People had to stay at home with their smartphones which have become the most reasonable way of using banking services. For many customers, it was the first experience of remote interaction with banks. And they liked it.

Secondly, the COVID-19 pandemic increased people’s confidence in online solutions. During the period of self-isolation, people had enough time to learn mobile banking. Those who didn’t trust online banking were able to discover its benefits and increase their trust in it.

Third, COVID-19 has changed users’ expectations. It became even more important for customers to save 3 major resources: time, effort, and money when getting banking services. And mobile solutions are one of the easiest ways to achieve this. So banks are improving the quality of mobile banking apps as well as expanding their functionality.

So, there is no doubt that the impact of Covid-19 on the banking sector has been enormous. And it has led to the emergence of both new trends in the banking sector and new fintech trends in general, as a result. Let’s take a closer look at the top trends in banking services in 2025.

The rise of neobanks

Neobanks is a new generation of banks that operate completely online. Such banks first appeared in the United Kingdom and then spread all over the world. Basically, neobank is a digital bank, which is only available to customers in a mobile app or on a computer. The main sources of neobanks revenue are transaction fees, subscriptions to premium accounts, and commissions from third-party services.

Unlike traditional banks, neobanks:

Do not have branches.
Can work without a banking license (not in all states).
Work on new technological platforms.
Optimized for mobile device processes.

Advantages of neobanking for clients:

Favorable terms of service due to lower costs.
Transparent terms, no extra hidden fees.
More flexible underwriting policy.
Automatic analysis of cash flows.
Access anywhere and anytime.

The neobank model is convenient for users and profitable for the banks themselves. They have many advantages over traditional banks. What’s more, in the context of constant digitalization, neobanks are becoming indispensable financial assistants. According to Statista, in March 2021 the six app-only digital banks had almost 40 million IOS and Android app downloads combined. The future of neobanks looks promising, so there is no wonder that they are part of banking technology trends.

Mobile banking experience

Today, a mobile device is literally the financial gateway to the world. That’s why banks are abandoning traditional structures and investing more in financial technology to offer personalized interfaces, improved security, and a wider range of services. With mobile banking, people can log into accounts from their phones and access banking services anywhere and anytime. One of the biggest advantages of mobile banking is that it is available 24/7. And since fintech companies and modern banks are using artificial intelligence extensively, banking apps could provide many more services in the future.

Easy access is one of the biggest benefits of mobile banking. People can make almost any financial transaction from their mobile banking app. So if they are on the go and want to transfer cash from one account to another, they don’t have to find a branch or wait until they get home. Therefore, mobile banking solutions are one of the main ways to meet the needs of modern users.

According to Juniper Research, the total number of online and mobile banking users has reached 3.6 billion by 2024. Also, experts predict that mobile payments will grow at a compound annual growth rate of 29.0% between 2020 and 2027, expecting to reach $8.94 trillion by 2027.

Contactless payments

Statistics show that consumers around the world are switching to contactless payment methods. Back in 2018, the number of contactless payments globally increased by 72% to 70 billion transactions, accounting for 15% of total card payments. This figure had significantly increased in 2020 because of the COVID-19 pandemic. According to Statista, contactless payment market revenue in the United States is expected to reach $358 billion by 2025.

The pandemic has put the spotlight on contactless payment as a flexible payment option that allows quick and secure payments. For example, in countries such as the UK and Australia, where contactless payments are used in public transport fare systems, they account for a significant share of card payments. Also, QR codes are popular means of contactless payments in Europe and Latin America.

Small stores are interested in QR-code payments because of the opportunity not to install a terminal and not to pay for its maintenance. Also, QR codes are of interest to small entrepreneurs who currently accept only cash: beauty salons, hostels, flower stores, repair shops, etc. Forecasts show that contactless payments will be part of banking technology trends for a long time.

Artificial Intelligence (AI)

Banks are becoming conglomerates of huge volumes of information and now we see the manifestation of rather tough competition in the banking segment. Adopting artificial intelligence is one of the most effective ways to improve service delivery and stand out from the competition. According to the OpenText survey, most banks (80%) are highly aware of the potential benefits presented by AI and machine learning. Banks need an effective tool that will allow them to reduce costs and increase profits. Therefore, artificial intelligence, processing huge amounts of information is in the focus of financial institutions.

In today’s world, banks own not only the money but also a huge amount of data on all of their customer’s income and expenses. When payments moved online and stores learned to give detailed information about the purchases, banks learned everything about consumer habits. For example, what flavor of ice cream he or she prefers and in which store. And what to do with this information, keep it useless, or use it for additional services? Obviously, the second option is more profitable.

At this point, banks come to the need to implement AI. Only artificial intelligence can process such volumes of information. Based on its algorithms banks will soon be able to launch a whole set of new services. This way banking application is gradually transforming from a fairly narrow-functional service into a full-fledged universal assistant for all occasions, which takes into account the tastes and interests of the client.

For example, going back to ice cream, a bank might create an app based on purchase history and geolocation. Or another example: the bank gives personal discounts on life and health insurance based on the purchase history of fitness subscriptions. According to analysts at McKinsey, this is what the bank of the future looks like.

But back to today, most large banks have chat-bots and voice-bots in their contact centers. Smart algorithms know how to quickly solve customers’ issues. Some banks went even further in developing the functionality of the voice assistants: they can be used to transfer money or buy shares. The robot is not only able to communicate effectively itself, but also to control the work of employees and analyze how well they build dialogues with clients.

These are not all AI applications in the banking sector. For example, smart algorithms can also predict the likelihood of cyberattacks, and more.

Open banking

Open banking is a system in which banks open up their APIs to third-party service providers to access clients’ financial data and conduct financial transactions on the clients’ behalf. This approach improves the availability of financial services by connecting traditional banks and fintech companies into a single ecosystem. The main principle of open banking is that users independently choose which companies they want to open their data to and this is possible only with their permission.

Data transfer in open banking takes place using APIs, and the client’s consent to the processing of their data is certified using a special token that is valid for a limited time frame. Open banking provides reliable security flow, completely protecting information from unauthorized users.

The number of open banking users worldwide is expected to grow at an average annual rate of nearly 50 percent between 2020 and 2024, reaching 63.8 million users by 2024. Open banking contributes to increased competition in the market and improved offerings for users of financial services. By resorting to this model, banks get an additional way of rapid modernization, while fintech startups will be able to develop faster. Users also receive significant benefits and can easily manage their finances, choose service providers and make better financial decisions.

Blockchain

The rise in popularity of cryptocurrencies has not gone unnoticed by the banking industry. Today, DeFi is some kind of alternative to traditional finance. Most of the existing DeFi protocols are created on the Ethereum blockchain and the number of new applications in decentralized finance is steadily growing.

DeFi consists of blockchain-based services and applications. Decentralized finance opens access to decentralized lending and new investment platforms for a large number of people. Moreover, it allows them to earn passive income from cryptocurrency assets, as well as save on transfer fees, loans, and deposits. Although the decentralized application sector is just developing, the advantages are already quite numerous. The main one is that any user can get a particular financial service, for example, a loan, bypassing the bank. Decentralized lending protocols minimize risk and provide 24/7 access to borrowed funds. This is especially relevant for borrowers from countries with expensive bank loans.

Even apart from DeFi, the growing popularity of blockchain has been keeping this technology in the top banking technology trends for several years. By using blockchain, banks optimize their functionality and reduce risks. For example, some banks have been able to migrate their operational systems and risk controls to innovative cloud-based platforms. Blockchain development isn’t so easy as some people think. So be sure to work with experienced developers.

The main areas affected by blockchain technology are as follows:

Optimization of financial reporting, driven by improved quality and timeliness of incoming information.
Reduction of compliance costs due to the transparency and ease of verification of banking transactions.
Minimization of centralized activity costs due to the implementation of digital identification and limited access to personal information.
Reducing the cost of operating activities due to the automation of transactions, as well as their control and error analysis.

According to Statista, the application of blockchain technology in the financial sector is expected to reach a market size of approximately 22.5 billion U.S. dollars in 2026.

Wrapping up

Banks are increasingly adopting advanced technologies and working on new digital transformation strategies. The rapid development of fintech and the growing popularity of DeFi platforms are forcing traditional banks to look for new solutions to compete with alternative financial service providers in the market. Top banking technology trends in 2025 include neobanks, mobile banking, artificial intelligence, blockchain, and contactless payments. These solutions improve the user experience, streamline internal banking processes and help achieve efficiency for both parties.

However, banking technology trends may change. Therefore, it is important to work with an expert banking software development team that can help you solve your tasks in the best possible way. IdeaSoft is a first-class software development company that provides European quality services. Our portfolio includes over 250 projects in different domains, including the banking sector. Check out our Fintech software development page or contact us directly to discuss your next project!

Software Requirements Specification: Writing Best Practices

When developing a software project, it is always a good idea to start by analyzing its goals and planning the development stages. That’s where you need a software requirements specification.

The SRS is one of the most important documents in software development. It is the basis of the project that allows you to choose the right direction of the development, define the roles of the participants in the process and minimize the cost and time of creating a software product.

In this article, we’ll explain in detail what the SRS includes and how to write a software requirements specification.

What is Software Requirements Specification (SRS) and why is it important?

So what is srs document? A software requirements specifications (SRS) is not just an important document, it is an appendix to a contract or agreement on the cost and timing. SRS is the subject of the contract and an integral part of it. It reflects all the important parts of the development, prioritizes tasks, and identifies ways for its’ technical implementation. It is safe to say that a well-developed SRS is a basis for the successful implementation of a project.

It may seem that it is enough to outline the requirements for the project as a whole, or individual tasks, and send them to the developer’s email. Of course, it is great when you have a fixed idea of the future project or an idea of the concept, it facilitates and speeds up the process of drawing up an SRS, but it can’t replace it.

For example, the client says: “I need an online store with a catalog of products, an order form, a shopping cart, the ability to pay online, information about the company, and contacts section”, while presenting an image that has been formed in his or her mind. At the same time, the developer can see the project 100% differently than the way the client sees it. An SRS document helps develop a common vision of the project.

To avoid disputes, frustration, unreasonable financial expenses, and loss of time, take care to draw up software requirements specifications for your future project. The requirements for the functionality of the project should be consistently and systematically described in the SRS. A well-written SRS document is the result of a detailed analysis of the market with the help of the discovery phase.

Below we will tell you how to write requirements for software using the best methods.

Key elements of an SRS document

An SRS document consists of 3 large sections: introduction, overall description, and specific requirements. All of them are equally important so they should be well thought out.

The introduction section describes the application or product that’s functionality will be described in the SRS. Here you show all the obscure technical words or terms that appear in the SRS. This section can even contain references to literature where you can find the basis of the used technologies and facts.

The overall description section describes the parts of the application or product functionality in more detail. Here, DFD diagrams are always used to show the interaction between different parts of the application or platform. This part describes what actions the users of the product are supposed to do. The overall description shows the business logic of a software product and explains what actions and technologies we can use to achieve the project goals.

Finally, the specific requirements section describes the specific features and requirements of the system. Each sub-clause of this part is intended to provide answers to different aspects of what functions the product should perform and what characteristics it should have. For example, the external interface requirement’s part aims to explain how the system will interact with third-party elements like APIs, hardware, software, or database elements.

SRS largely consists of functional and non-functional requirements. Both are very important in this document. So, what is the difference between functional and non-functional requirements? Let’s figure this out.

Functional vs non-functional requirements

Functional requirements in SRS are the goals of the application or product. They describe how the application or product will function. Non-functional requirements are the general characteristics that affect user experience. These are requirements for data integrity, security, speed, intellectual property, and licensing policy.

Non-functional requirements cannot be described as a feature, for example, performance requirements. This is not a feature, but it imposes certain restrictions. For example, the project database should be able to handle 1000 requests per second, etc. This requirement leads to tremendous work to optimize the project.

Both types of requirements are critical to the success of a project and affect the development process. This is why it is so important to work on collecting and describing project requirements. If you are wondering how to write functional requirements in SRS you have to know that the clearer the requirements are, the faster and more efficient the product creation process will go.

Functional vs Non-functional requirements

How to write a software requirement specification document

Firstly, let’s find out who writes software requirement specifications (SRS)? Usually, a technical writer composes the SRS, but it can also be done by a system engineer or programmer. Nevertheless, business analysts, project managers, software engineers, and clients also participate in the information-gathering process for the SRS.

The main purpose of the SRS document is to provide comprehensive information for the development team about the product being created. The development of an SRS document consists of the following steps:

Outline creation
Purpose definition
Overview creation
Functional and non-functional requirements description
Supplemental details addition
Approval

The main sign of a good specification is its comprehensibility: a bad specification is an incomprehensible specification. We have prepared for you some advice on how to write a software requirement specification:

Describes everything as concisely and clearly as possible.
No ambiguous descriptions. The person reading the SRS must understand exactly what is written, not something else. Murphy’s Law: “If you can be misunderstood, you will be misunderstood”. You should try to avoid this.
Keep it simple and “readable.” Don’t use anything too abstract. Simplicity is beauty.
Degree of detail. It can be defined as follows: if the person can freely present the information about the functionality and the written information is not confusing to the person, if the requirements are not subject to any ambiguous understanding, if the requirements adequately describe the behavior of the functionality, then the development of the SRS can be considered complete.

Programming is a wide field, so it is very important to have precise and unambiguous instructions. For example, a site on JavaScript can be created in more than 5 ways. If you’re not sure you can create a user-friendly SRS to specify your requirements.

Wrapping up

Now when you know how to write a software requirement specification, you can see how essential an SRS document is when developing any kind of software. A well-written SRS is a basis for the successful implementation of the project. By creating software requirements specifications you get the following:

Give developers an idea of how the software should work.
Provide developers with enough information to choose the appropriate tech stack.
Give designers the idea of which test cases should be covered with the design.
Provide testers with guidelines for the creation of test cases that match business needs.
Ensure that end-users understand how the software works.
Provide investors with an overview of the features so that they can make informed investment decisions.

Of course, a development team can start to work on your software without an SRS, but this document guarantees that you will get exactly what you want. Since the SRS is the foundation of the project, it is better not to skip this stage and let the experts gather clear requirements.
IdeaSoft experts will be happy to help you draw up clear requirements for your projects. Our qualified development team of engineers, business analysts, DevOps and designers will study your business idea in detail to select the best technical solution to bring it to life. Feel free to contact us for more information.

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Current State Of SaaS Market

Most Prominent Examples of SaaS Projects

Netflix

Slack

Shopify

Zoom

Atlassian Jira

Major Types of SaaS Software Solutions

Horizontal SaaS, Vertical SaaS & On Top SaaS

How to Build a SaaS Product for Your Business

#1. Conduct Market, Client & Competitor Analysis

#2. Determine the Project Requirements – Discovery

#3. Hire an Expert SaaS Team

#4. Choose the Required Tech Stack

#5. Build an MVP & Launch the Development

#6. Finalize Your SaaS App

Advantages of Software-as-a-Service Products

Conclusion

Top 5 Examples of Successful Mobile Development Startups

IKEA Place App

Sephora Mobile App

Notion SaaS App

Foodpanda Application

Coca-Cola

Major Challenges in Mobile App Solution Development

Challenge #1. Poor User Experience

Challenge #2. Research the Competition

Challenge #3. Requirements Clarification

Challenge #1. Hiring an Inappropriate Team of Developers

Challenge #2. Using Outdated Technologies

Challenge #3. Limited Development Budget Issues

Challenge #1. Insufficient QA Testing Finalization

Challenge #2. Timely Mobile App Marketing

Challenge #3. Resolving Issues & Keeping the App Updated

Final Words

FinTech Industry Market Overview

FinTech Risks and Challenges

Systems Vulnerabilities

Digital Identities

Data Ownership

Ethical and Bias Concerns in AI

Fintech Security Concerns For Third-Party Service Integrations

Cloud Migration

Malware Attacks

Key Solutions for Risks and Challenges in Fintech Development

Adopt a Secure-by-Design Mindset

Protecting Sensitive User Data

Penetration Testing for Escaping Malware Attacks

DRP/BCP Analysis in Fintech

Using Software Composition Analysis (SCA)

Implement Safe & Secure Third-Party Service Integrations

Involve DevSecOps for Cloud Migration

Wrapping Up

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What is mobile app monetization?

How to monetize a mobile app?

Android app monetization models

iOS app monetization models

Wrapping up

Table of contents:

COVID-19’s impact on the insurance industry

Insurance technology trends that are shaping 2025

Implementation of AI-based solutions in insurance

DLT and blockchain as one of the insurance technology trends

Better user experience with mobile apps

Cybersecurity insurance

Predictive analytics

The rise of InsurTech

The bottom line

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Ethereum