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In-house Development vs Outsourcing vs Low-code: Which is Better for a Fintech Startup?

There are two basic approaches when it comes to launching new fintech products: to make it in-house or to hire experts from outside the organisation. However, if we delve deeper we can find different ways in which these approaches can be realised and even ways to combine them.

In-house Development vs Outsourcing vs Low-code: Which is Better for a Fintech Startup?

There are two basic approaches when it comes to launching new fintech products: to make it in-house or to hire experts from outside the organisation. However, if we delve deeper we can find different ways in which these approaches can be realised and even ways to combine them. Today let’s try to demystify outsourcing and in-house development.

2 (3) ways

Before even the first decisions are made, a company that is planning to launch a new fintech product must assess its development capabilities and resources. The most vital question for startups is: are we ready to form a full-fledged software development team? Can we recruit designers, coders, QA engineers, managers, etc.? Can we afford it and is it physically possible to recruit these people under a condition that we need them to be somewhat experienced? Quite often it’s problematic, especially right now, during the fintech boom, when the best experts already have well-paid and stable jobs in larger organizations.

There are two, or three ways of approaching this issue. The most obvious, yet risky one is actually creating this in-house team. The other, much more reasonable, is outsourcing the project to a dedicated development company that can finalise it end-to-end. But there’s also a third way, a bit of a compromise - building an app without coding. Let’s break down who they all are.

Doing it all on your own

As said earlier, building an app without any help from outside is quite challenging. It simply means starting and completing the whole software development life cycle (SDLC) within the company, using internal resources and with no external help. While this idea may seem simple and straightforward, it’s actually extremely hard to execute for startups and only mid to large organisations can bet on it. How about employing a roster of:

  • Developers (front-end and back-end)
  • Testers
  • A technical lead
  • Product designers
  • A quality assurance engineer
  • DevOps engineer
  • A product owner
  • A project manager
  • A project sponsor

No, not all of these people will have enough to do to keep them full-time, so how will you convince them to stay? And do you have a few months to find them?

However, there are still many positives of keeping the process inside. Most important ones are related to having total control over the process. As the person with the vision, you decide what the developers need to focus on, what technologies they use, what tools are at their disposal. If you personally know and understand the people that work for you, it’s easy for you to manage them. If you have them in the office, within walking distance, you don’t even organise calls, you can meet in person and in most cases, there are no cultural differences between you, so the risk of miscommunication is minimal.

Asking experts for help is alright

There is nothing wrong with paying a seasoned financial software development company for help. It’s a standard practice and - surprisingly - it’s not only an easier path but also a cheaper one. That’s right - in most cases outsourcing the development services is more cost-effective than doing all of the work in-house. How is it possible?

Let’s consider the problems of in-house development that outsourcing solves:

  • Direct access to talents

While recruiting a whole team to launch an app requires a lot of money and up to a few months, you don’t need to do it at all. A dedicated, fintech software development company’s focus is to have a long list of experts on-board at all times. Most of them work on projects, some are just waiting to start a new one. Now, let’s consider the fact that you don’t need a designer during all stages of SDLC (software development life cycle). You don’t want to work with a freelancer. An outsourcing company is ready to provide you with the people you need when you need them and for as much as you need them. You can scale your team up or down, depending on your needs and you only pay for the work that is actually done. Moreover, they all work with fintech apps full time, so you can count on their insight and understanding of the industry.

  • Predictability

Trust is not only the most important feeling a fintech product should evoke in its users. Trust is also the most important you should have towards your team. And trust is based on predictability. Nobody wants any surprises that can disrupt the work. And by relying on experts that have already built and launched dozens of apps within this industry, you can be certain that everything will be planned and executed just the way it’s supposed to be and using the optimal technologies and tools for the job. Also, on schedule.

The low-code way

But what if you don’t feel comfortable with the two most popular options for some reason? No problem, that’s OK. In many cases, you can do just fine in-house, but without building the whole development team, as nowadays you have access to easy-to-use tools that let you build apps with less coding (low-code) or even without it (no code).

People building an interface with their hands.
Building without code

For example, if you need to create an internal tool for data management in your company, you can use Forest Admin, as it doesn’t require a lot of coding (check the list of Forest Admin integrations to verify if it works with your stack). You can try it for free to see if it fits your needs. If it does - you’ve just saved a ton of money for your startup.

The way it works is brilliantly simple. You just install it and connect with your datasource. The system will automatically build the backend API and an admin frontend with a visual interface. Then you just customize your admin panel to your needs, so it presents the data and lets you manipulate it the way you want in your organisation and within your business logic, set up the UI (no coding required here, the editor is visual) and you’re ready to go. You can deploy your new app’s backend on any cloud you like (be it AWS, Google Cloud or anything else). Now, you’re the boss here - just configure roles and permissions, let your team join in and start work.

It's crucial for fintech apps to meet certain legal requirements. When you’re dealing with sensitive data, security is key. Taking care of this aspect is not that simple, when a company is launching a product without any help from outside - if not impossible. Security tests often need to be outsourced, are expensive and necessary. However, when you are not coding the core of your app, but relying on a system that was designed to generate the code according to predefined standards, you can rely on it.

Just pick what’s best for you

The possibilities are quite many and startups right now are free to create the apps they want however they prefer and however they can. Which option is best for them depends solely on their capabilities and business logic. If you can afford it and you already have a well-established development team - you're free to do it all on your own. Are you less experienced and want to minimise the risks? Partner up with a specialised outsourcing company, it’s never a bad option. Do you need an app that could be created with minimal effort? Try a low-code solution - it may be perfect for you.


Jakub Skowron

Content Writer at Code & Pepper. Technology enthusiast, literature devourer, and creator of insightful fintech-related content. In his spare time, he also works with international public art projects.