Industries are rapidly evolving. Thus, your excellent app idea today might turn obscure by the time your app is launched. You’re certainly here because you are planning for mobile app development. However, you must know that there’s a lot to consider along the way. Not only should you keep up with the ongoing trends, but make sure that your app’s ready to face the competition and is (most importantly) secure and scalable.
But how do you do that?
Blockchain is the ultimate solution. This decentralized ledger technology has proved valuable for various industries ever since its inception. We’re already amidst the era of Blockchain, utilizing it to strengthen your fintech app. In this blog, we will tell you all about Blockchain and how you can implement it in your fintech application.
What is Blockchain?
Blockchain is a decentralized digital ledger technology that records transactions and information in a secure, transparent, and immutable manner. It works by using a network of computers (nodes) to maintain a continuously growing list of records (blocks) that are linked and secured using cryptography.
Every block carries a cryptographic hash of the previous block, transaction data, and timestamp. These blocks cannot be altered or deleted once added to the chain which ensures the integrity and immutability of the data.
Blockchain technology is primarily known for its association with cryptocurrencies like Bitcoin and Ethereum, but it has numerous other potential applications in fields like finance, supply chain management, healthcare, and voting systems.
Which Fintech Apps Need Blockchain and Why?
Security is an important but not the only reason why the fintech industry requires Blockchain. It ensures secure and transparent transactions. For the fintech sector, it’s important that deals and transactions don’t get altered or manipulated. Banking and financial contracts are especially affected by this based on their standard practices that vary across countries.
Fintech companies have to deal with a lot of trust difficulties for which they spend lump sum money on building secure networks for financial transactions. However, traditional practices for doing this involve middlemen, significantly increasing the costs with less relevance to security. Blockchain app development services can help solve these problems better than anything else.
- Blockchain security is particularly effective for industries with financial components that are based on iron-clad contracts.
- Insurance companies who want to avoid fraudulent claims and illegitimate recipients can implement blockchain to ensure clear systems.
- In fact, real estate mobile apps that include financial services and contracts should leverage the benefits of Blockchain technology to maintain transparency.
Blockchain significantly eliminates third-party involvement in financial transactions and contracts for various industries, saving them a lot of costs and security issues.
Applications of Blockchain in the Fintech Industry and Its Impact
Many companies are actively using Blockchain in mobile app development because of the security and decentralization of data it offers. While the Fintech industry needs to be shielded against security breaches and is responsible for a lot of sensitive data, Blockchain is good news for such companies.
Blockchain technology has a noticeable impact on various economic factors and continues to strengthen the fintech sector in a lot of ways. Here are some ideal applications of blockchain in the financial sector and ways to implement it into fintech solutions.
Transfers Without Middlemen
Financial authorities often charge transaction fees on money transfers. Although the money is yours, governments impose several rules and regulations. Blockchain technology can help in conducting transactions at significantly lower transaction fees. You can send money anywhere with no intermediaries and lower peer-to-peer transaction costs. Additionally, Blockchain’s decentralized nature allows you to have complete control over your financial resources.
Develop Smart Contracts
Smart contracts are probably the most effective applications of blockchain. These are codes that run automatically when specific criteria are met. It enhances the network chain because of auto-implementation capabilities. This application works perfectly for firms that are into lending and managing loans.
Validate Digital Identity
With the help of blockchain technology, end-users can control their digital identities. They can complete registration processes online, set private keys and securely transmit payments or data. Banking apps can make the best use of these capabilities.
Streamline Cross-Border Payments
For instance, you withdrew money from another bank’s ATM. In this case, both banks need to communicate to analyze account details and process the transaction. Technically, this can be time-consuming. However, blockchain can help to cut down the processing time for cross-border payments. When banks and other financial institutions join a single blockchain network, they can upload and access data that might be necessary for conducting transactions.
Finance For Trade
Stock trading gained a lot of popularity over the past few years, and many companies are now building a stock trading app. While there are several intermediaries involved in the trading procedures like brokers, demat agents, etc, it makes room for dubious techniques and risks. A blockchain-based mobile app for trading can combat a lot of issues for end-users.
- Cut third-party involvement
- Close loopholes and make the process transparent
- Protect the stock exchange network with immutable data records
Earlier in one of our blogs, we shared some important details about developing successful stock trading apps. To know more,
Read Our Blog: How to Build a Stock Trading App In 2023
Audit-Proof Data Storage
Although reviews and audits are integral for the fintech industry, all the paperwork involved in this process can be extremely time-consuming. Blockchain technology only allows inserting new blocks without interfering with the existing ones. Thus financial institutions can easily access historical data for smooth and quick auditing.
Prevent Cyber Frauds
Fintech firms deal with a lot of sensitive data. Losing all of it to a cyber breach will lead to losing the trust of their customers and lump sum money. Blockchain is one of the most secure technologies available. It uses hashes to encrypt data storage and transfers. Since this data is stored in the form of chains, infiltrating the network and stealing data is difficult.
Build a Fintech App With Us
This is a significant time for the fintech industry, considering the predicted rise in the coming years. So, if you’ve been planning to build a fintech mobile app, you should work on it soon. Moreover, blockchain app development for fintech solutions will make them more secure and competent in various ways which we discussed above. Despite all the advantages that these technologies have, it’s important to look for a reliable development partner who can help you execute a successful app.
Narola infotech is a mobile app development company with over 17 years of experience developing successful, robust applications for various industries. We’re a team of 350+ enthusiastic developers, designers, and quality analysts who are keen on details and bring forward the best skills to ensure 100% satisfaction.
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