How to Start a Fintech Business

UK fintech is one of the most thriving markets in the world. With such a diverse blend of new startups and well-established tech giants, such as Monzo and Revolut , finding a gap in the market has never been more difficult. How then can fintech companies thrive in the UK market? We’ll share what skills you need to start a fintech business, considerations to make and how to legally establish your business for success.

What Is a Fintech Business?

With an estimated market value of £10 billion , financial technology — or fintech — is fundamentally changing the way financial services firms operate and transforming the way we transfer, borrow, protect and manage our money.

A fintech business is primarily about using technology innovatively to improve and automate the delivery of financial services, making processes for companies, business owners and consumers easier and less cumbersome. For example, instead of going to a bank to apply for a bank loan, you apply for it online. Human intervention is thus limited and transactions are done via technology and mobile devices.

What Skills Do You Need to Start a Fintech Business?

As one of the fastest-growing industries, fintech is well-suited to people who are passionate about technology — especially those who want to have access to and work with newer technologies. However, for every successful fintech company, many other similar businesses fail. To avoid this situation, it is crucial that you prepare yourself by gaining the right skills, experience and team to help you achieve your fintech success.

Before you start a fintech business, you need to understand how business and finance work. To build this foundation, you should complete a relevant finance-related course, such as a financial degree or diploma, if you don’t already have this knowledge. You may also feel the need to increase your technical skills, such as learning to programme, though you can employ a development team to carry out this work on your behalf.

Soft skills including, creativity, teamwork and agile thinking can also be invaluable when building up a fintech business. They will help you to ensure you form the right team of experts around you, pitch your concept to investors and solve any tricky problems you may face.

How to Start a Fintech Business

It goes without a say that technology is changing the traditional financial industry. But with startups entering the market every month and giants already ruling the industry, it's hard to make a mark. As a result, starting a fintech requires more attention than most businesses. The start of your company will shape its future, growth, operation and more. But, where do you begin?

• Identify Your Niche — For starting a fintech company, you must be clear of your target market and the problem you are looking to address. Besides choosing a domain, your product should cater to a specific audience, e.g., a country, a state, a city or a particular demographic. However, it is always better to launch your business locally first and expand to the global market later if needed.
• Know the Regulations — The banking and finance industries are highly regulated — and for obvious reasons. The regulations are why financial service industries can be tough to break into. Several laws have been put in place to ensure that these sectors are protected from frauds, and can immensely vary depending on the country, state or region you want to operate in. You need to ensure you know what the regulations will be and understand how they might affect the operations of your business.
• Hire a Team — The people who work with you will determine how successful your new venture becomes. From the start, you need to surround yourself with people who know what they’re doing and have the skills and experience required for a top-quality job. You may have the complete knowledge of the nuances of the finance world, but you need an equally (if not more) knowledgeable team of technical experts to create your fintech product.
• Get Funding — Starting a fintech company is a costly affair. Making an incredible product requires talent, and talent isn’t cheap. As traditional organisations are trying to acquire fintech talent for themselves, startups would inevitably face competition in hiring. Getting an investor on board becomes essential to not compromise on the quality of your product by giving you the funds to hire the best people or help you bring your idea to the market.

Why Now Is a Great Time to Start a Fintech Business?

Starting a fintech company has the potential to become a lucrative venture if you can apply all the above skills and knowledge to create the right product. The huge growth seen in the fintech sector provides a great opportunity for those wishing to start their own fintech business for several reasons:

Users Are Ready

People eagerly opt for branchless banks and direct investments. Today, users are always on the go, they want to be more independent, and so they agree to take risks. The UK consumer base has one of the highest fintech adoption rates in the world at 71% — providing a huge partner and customer base for fintech firms starting up.

Expertise

Fintech has become popular as the industry grows in expertise. Now it is much easier to find developers who understand the difference between money and balance movement, or payment flow and transaction monitoring process. Moreover, there is a new business line — fintech consulting services — that helps companies improve or develop fintech products from scratch more efficiently time and cost-wise.

Lower Barriers to Entry

Financial service providers and banks can promote collaboration and streamline the integration of services using open protocols. In this way, they lower entry barriers for any company and enable it to offer financial products to its customers.

Ready to Form Your Fintech Company?

If you are ready to start a Fintech business, it’s time to form your company. You can form a limited company or go the sole-trader route. Deciding and completing your company formation can be the most challenging part of starting a business, but it’s crucial to your success.

Are you ready to start a Fintech business? At Mint Formations , we help you form your limited company and take away all the stress that comes with starting a business. We’ll secure your brand name and get your company registered fast so that you can start doing what you love.

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