What are Fintech Companies?
FinTech companies are young start-ups that offer all kinds of services in the financial sector. Regardless of whether investments, lending or payment methods – the newcomers compete with long-established banks. This is an advantage for consumers, as they will have significantly more choice in the financial sector in the future. In addition, the companies operate almost exclusively on the Internet and can greatly reduce the costs of loans, deposits, and the like.
7 Important properties to be found in fintech companies
Which permits a fintech startup must have, according to Seveke, depends on your service provision and the market in which you operate. “Licenses often required are those of the AFM (Authority for the Financial Markets), DNB (De Nederlandsche Bank) and FSA (Financial Services Authority). These institutes set all kinds of requirements for your business operations. For example, how many people you can employ. Do not underestimate how much time and lead time can be involved.
Certification requires that you comply with all kinds of rules and safety requirements. “It covers your IT facilities, but also all kinds of best practices,” explains Seveke. “A well-known one is PCI-DDS, a security requirement for organizations that process and store credit card data from the major credit card companies such as Visa and Mastercard.” The SOC 1 certification (formerly SAS 70) is also important for many fintech startups. “This shows that as a service provider you have the internal control over financial reporting in order. ISO standards are also important, especially ISO 27001. This shows that you have taken the necessary security measures.
- Accounting and reporting
Trusting your accounting is even more important in financial services than in other industries. That is why you have to think carefully about the design of your system. A regular accounting system is therefore not sufficient, according to Seveke. “Aspects such as loans, interest, terms, terms, conditions, authorization, payments and other issues associated with financial products require advanced accounting solutions.” And transparency is also important, he explains: “Permits and certifications require conclusive reports. So make sure you have capable reporting options.
- Requirements for technology/data model
A regular startup has the opportunity to make drastic changes along the way. A fintech startup does not have this luxury. After all, you have to deal with permits and security aspects that impose much higher requirements. That is why a fintech startup must think very carefully about its technical infrastructure in advance. But how do you make the right choices? And is your IT prepared for success? It is essential for a fintech startup to have an architecture and solutions that are scalable. Continuity and therefore transferability is also important. You must continue to maintain the structure of the solution so that the work is transferable. Complexity is a pitfall, so work according to the KISS principles
Security is an absolute top priority for any fintech organization that processes transactional data and personal data. “In addition, do not forget that from 1 January 2016 you risk hefty fines if privacy-sensitive data is leaked. In any case, you will also suffer a lot of image damage in the event of a data leak. Think of hiring an ethical hacker and having a penetration test (pentest) performed. ” A good starting point for the security points for attention is the OWASP top 10. That is a list of the most sensitive security aspects of web applications.
- The right partners
The fintech business is anything but simple. As a startup, you rarely have all the necessary knowledge and skills in-house. And you can probably use the necessary help with your business network. According to Seveke, it is therefore important to choose your partners with care. “Go for parties who have offered their services more often than you. Knowledge of technology is valuable, but ‘business sense’ is often even more important. After all, partners must be able to think along with you ”
- A very strong business case
Finally, Seveke gives explicit advice: ensure a strong business case. “No matter how advanced the technology is, your security is still so hardened and the idea still so original: without a good business case you cannot last long. Above all, think carefully about your revenue model. For example, you may have come up with a nice solution to a problem that the whole world is complaining about. But if the urgency is not great enough and they are not prepared to pay for that solution, your fintech business will not last long. ”
It is an Egyptian online payment company that was founded in 2016. It aims to build a more financially inclusive society through advanced technology accessible to anyone. It acts as an intermediary between merchant and customer and offers many services. Vapulus gives an application that allows you to make many payment transactions with both end-user and merchant also.
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