The fintech industry is booming, with thousands of companies working hard to serve the needs of tech-savvy and financially astute customers. Thanks to the rise of digital channels, the supply of financial services has never been greater, while the sophistication of digital products and services has grown as well.
However, to secure investments, fintechs must demonstrate clear differentiators that empower them to attract more customers, partners, and employees – and retain them.
Seed capital is getting tight due to economic hardships and inflation, so investors are carefully reviewing the valuations of newcomers before greenlighting new or additional funding rounds. Fintechs must stay agile in managing expenses and take new products and services to the market first to avoid being stuck in the middle. Still, many young firms must face an ever-familiar fork in the digital banking road and decide whether it is better to build or buy their technology.
Financial institutions looking to move away from on-premise IT systems have traditionally had two options: buying an expensive, inflexible, vendor-locked traditional core or building a custom core from scratch that is dependent on programmers, not scalable, and quickly becomes outdated. However, the best approach is to compose a core that combines top notch components and experts for each area of the business. Composing with a true SaaS partner like Mambu, is the most economically and technologically feasible.
According to the State of Digital Banking 2022 study conducted by Forrester, almost half of the organisations that decided to build their technology took more than 12 months to get to market. Similarly, of those respondents, 88% indicated their projects failed to meet budgetary expectations. Fintechs cannot afford to miss their targeted budgets, with investors hovering over them and pouring through every detail of their business and technology decisions.
Financial institutions can work with partners like Mambu to eliminate all the hurdles that come from growing on highly customised architecture so they can focus on growing their businesses instead.
Mambu's composable approach allows each partner in the ecosystem to focus on their area of expertise. Leveraging a robust, up-to-date, secure, and flexible cloud platform, means that fintechs can invest their time in the areas of differentiation, which allows them to stand out in the market and not spend time and resources on maintenance.
In the SaaS model, everything is included and supported by high standards and global experts. There are no additional costs to the subscription, and everyone is always connected with the latest updated versions available. Configurations and adjustments are done in minutes (vs. months or years), and it is always online, backed up, and uptime. As a result, total costs of ownership savings with Mambu, concluded in conjunction with internal analysis and Accenture's research, can run as high as 30-50%.
To secure investments, fintechs must demonstrate clear differentiators, stay agile in managing expenses, and take new products and services to the market faster than ever before. When building their technology, fintechs can work with partners like Mambu to eliminate hurdles and focus on growing their businesses. The SaaS model is much more affordable in the long run, saving fintechs a significant amount of costs during uncertain economic times.