Low-code is no stranger to SaaS companies—its promise as a magic bullet for many software development headaches is widely renowned, resulting in its popularity across industries. Insights from Fortune Business project that the global low code development platform market will hit USD 264.4 billion by 2032, with a CAGR of 32%.
Fintech companies are flocking to low-code for its speed and efficiency: The percentage of institutions using low-code jumped from 80% to 97% between 2021 to 2022. That’s because low-code technology is helping unlock new digital capabilities and revolutionize operations to stay ahead in an increasingly competitive landscape.
True its name, low-code involves the concept of adding functionality to your site, app or service with a couple of lines of code instead of building something from scratch.
Much has been written about low-code and its plethora of business benefits, but how does this all fit into the fintech landscape, and what are the industry’s future considerations?
Let’s dive into ongoing trends and what the promise of low-code poses for the fintech industry.
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A Snapshot of the Current Landscape
The SaaS industry is currently in the midst of an arms race, and competition in the fintech arena is only getting fiercer. Fintechs are facing increasing pressure to deliver an exceptional customer experience among audiences looking for the most agile, efficient, and secure platforms to fulfill their financial needs.
Speed is the name of the game, and it’s not just about staying ahead of the curve in terms of market shifts but also taking swift action on what your datasets reveal.
With the rapid growth of digitalization in financial services, a vast amount of data is circulating. This means SaaS platforms have an ever-growing amount of insights and analytics to keep on top of.
However, sifting through these huge datasets is incredibly time-consuming and labor-intensive, exacerbating room for error when relying on human input alone. As a salve for this, organizations are leveraging AI, such as machine learning algorithms, to map out patterns and spot potential abnormalities. Yet, fintechs are contending with the additional burden of integrating these technologies into their systems—a hassle made worse when dealing with complex legacy systems.
To add salt to the wound, compliance and regulations are only becoming murkier waters for SaaS providers to navigate as rapid digital evolution is occurring. Low-code platforms aid fintechs to simplify these complexities, helping SaaS companies resolve pain points and instead focus on delivering an optimal user experience.
Augmenting Agility
To propel agility and scalability, SaaS companies are integrating low-code into their software development strategies. Specifically, low-code platforms are empowering companies to make data-driven decisions at an accelerated pace.
Low-code’s power lies in its ability to streamline and automate processes. Historically, fintech companies have had to battle with ever-complicated operations and logistics to update features and implement software that keeps pace with customer demands.
Additionally, this solution is fueling democratized technology across organizations, with platforms providing intuitive visual interfaces that include drag-and-drop features to embed new features and updates easily in software. This means that a high degree of coding competence is no longer a dealbreaker for developing every new feature in an app or software.
Crucially, low-code and AI make a powerful combination, ultimately enhancing each other. While AI is about how teams can navigate data, such as generating predictive analytics, low-code focuses on what tools and interactions to integrate into systems to enhance data-processing capabilities. For example, users of any coding experience can use low-code to create custom data flows. Moreover, AI tools can be embedded into low-code widgets, meaning that when these two technologies converge, organizations can maximize scalability and agility. Essentially, low-code helps teams hone the build blocks for the application, and AI injects intelligence and automation into the process.
As mentioned, compliance is only becoming more complicated, especially when dealing with consumer data. It’s challenging for fintechs to keep abreast of new regulations and existing ones that are always rapidly evolving.
The beauty of low-code lies in its ability to simplify historically complex processes. Because of their hyper-automation, low-code platforms are powerful solutions for generating compliance assessments and reports, auditing organizations’ compliance performance, and configuring workflows. Flagging potential risks is an added advantage of these automated compliance capabilities.
Reap Benefits by Treading Carefully
Despite all the hype, the industry is still in the early adoption stage of low-code. The market is still very young, and microservices, such as email management and data analysis, will continue to emerge as this phenomenon evolves.
As it becomes more widely adopted, organizations should encourage teams to explore low-code to achieve faster-to-market capabilities. For instance, when front-end configuration improvements are spotted for minor features, these can be more swiftly achieved with the help of low-code.
However, it’s worth noting a word of caution: While low-code is excellent for enhancing the scalability of software services, it should not be the only tool in your software development arsenal. Additionally, as the market matures and vendors build their track records, fintech leaders will find it easier to select suitable low-code providers to meet their data needs.
By nurturing tech democratization across companies, low-code will also arguably yield a more agile workforce that has greater familiarity with app development and its power as an ROI driver. Having said that, business leaders should tread carefully when democratizing technology and ensure their cybersecurity protocols keep pace with tools like low-code platforms.
As the adoption of low-code platforms becomes widespread among fintech companies looking to power up their customer experience strategy and digitally democratize within their organizations, it’s vital business leaders don’t lean on this technology as a crutch. Instead, they should empower teams to know when and where to use low-code and how this technology fits into the broader picture of their software development blueprint.
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