Unlocking the next frontier of growth with the modern FinTech Stack

Find out the key elements that make up the FinTech stack, and also delve into what’s powering the new-age digital challengers

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FinTech stack

We live in a world where financial services and technology are locked in a union. Today, with the inception of FinTech and the evolution of the use of technology, we have witnessed significant breakthroughs in the traditional offerings of the financial sector.


From the amalgamation of financial services and technology, stems greater synergies that are powering organizations to constantly innovate and adapt to changing marketplace dynamics. As CIOs and their teams are preparing to embrace the next wave of the digital revolution, FinTech is in the midst of a massive transformation—paving the path for financial innovations that seemed impossible a few decades ago.

FinTechs saw an opportunity to step in and redefine financial services with the ‘unbundling’ and the more recent ‘re-bundling’ of banks and FinTech services. With the number of FinTech startups more than doubling in the last two years, let’s take a closer look at the key elements powering these nimble, new-age digital challengers.

The modern FinTech stack


Over the years, FinTechs have been disaggregating the components of traditional banking and offering solutions tailored to meet the diverse needs of retail customers and businesses. As a result, financial services today have become synonymous with futuristic apps running on the cloud. They are also seamlessly embedded into non-financial digital platforms and popular marketplaces.

Having said that, there’s a lot that goes into the making of frictionless FinTech offerings. Here are the key elements powering modern FinTech providers to offer flexible solutions and, in turn, shape the future of finance.

We’ll unpack the components of the FinTech stack, starting right from the bottom:

  1. Licence:

In today’s highly regulated industry, FinTechs are required to apply for licensing depending on the type of services they plan to offer. For instance, retail service providers need to obtain a retail FinTech licence to offer lending and depositing services to Micro, Small, and Medium Enterprises (MSMEs). FinTechs can also find a sponsor bank to partner with and obtain the necessary licenses until they get one of their own

  1. Operational setup:

Automation tools present a huge opportunity to speed up FinTech operations and enhance performance rapidly without compromising quality. An operating model with a focus on automation tools and future-state capabilities powered by technologies such as artificial intelligence (AI) is crucial to drive immediate value and position FinTechs on a growth trajectory.

  1. Fraud and compliance:

Building a resilient compliance program is essential to set a FinTech up for success. FinTechs need to implement Anti-Money Laundering (AML) and Know Your Customer (KYC) compliance processes as well as take up a systematic, measured, and proactive approach to fight fraud and meet regulatory compliance.

  1. Product management:

We see FinTech startups today moving beyond the constraints of legacy and monolithic architecture to deliver a coherent and omnichannel experience. FinTech product development is central to building innovative solutions that are state-of-the-art and user-focused. If done right, product development can end up becoming the most sustainable source of competitive advantage for FinTechs.

  1. IT infrastructure:

FinTech companies are rolling out scalable solutions by embracing cloud-based infrastructure. From being able to store and manage data in a secure and reliable manner to being able to achieve faster go-to-market, higher cost-efficiency, and better user satisfaction—cloud infrastructure is helping FinTechs scale up while keeping costs low.

  1. User interface:

The User Interface (UI) design of FinTechs has come to be its major selling point. The advent of new interface technology has redefined the FinTech user experience, making it a critical component of consumer engagement.


APIs: Powering new-age innovations at scale

Growing at a CAGR of 20.5%, the global FinTech market is expected to be valued at USD 699.50 billion by 2030. In all this, the role of APIs in driving the unprecedented growth of FinTechs cannot be understated. From fostering collaboration to enabling greater adaptability and faster innovation, the benefits of APIs go above and beyond pure integration. Moreover, by embracing digital decoupling, financial institutions are accelerating modernization without the hassles of the wholesale migration of legacy systems.

With banks evolving towards an agile IT architecture and actively partnering with FinTechs, we will see the rise of modern applications that will change the way we pay and get paid, budget and bank, and trade and invest.

The maturing FinTech ecosystem in India

Owing to the acceleration of digital momentum brought on by the pandemic, the FinTech ecosystem in India is expected to thrive in the coming years. Embedded finance, Banking as a Service (BaaS), and Buy Now, Pay Later will continue to gain traction, ushering in a new era in FinTech and edging the country forward toward financial inclusion. By leveraging a slew of technology innovations and employing tools such as machine learning and automated data analysis for credit assessment.

The article has been written by Nirav Choksi, CEO and Co-founder at CredAble