As digitization lowers the cost of financial services, even the largest and most rigorous players in the industry are considering digital fintech products. For investment firms, this usually means using an out-of-the-box solution to fix some issues in the existing system, rather than creating a bespoke online investment platform.
Unfortunately, this approach becomes a Digitizing investments commonly used backfires for two reasons. First, it is highly inefficient to digitize certain parts of the system and leave the rest untouched. Second, due to the differences in government regulation, there is no universal pre-built platform that would fit the needs and processes of every investment firm.
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But what does it take to create an investment platform that has a website, web App or a mobile application? Read on to find out what to consider before creating an investment platform, what features it should have (based on the fintech projects we have developed) and how to calculate investment platform development costs.
What to consider when building an investment platform
Patrik Hansson, our client and founder of Swiss fintech startup Clear Minds, believes that building an investment platform requires agility first and foremost :
“For those who are just starting to build their own fintech, the best advice I can give is to be agile; be quick; listen to the market; Have your idea, but don’t get too attached: try it and adapt it. That’s the crucial point if you really want to create a good solution for the market.”
We agree. In addition, you need to be clear about who your target audience is and whether the platform will be B2B or B2C.
The analysis of the target audience is important because the architecture of the service depends on it. With B2B, for example, it becomes more branched and complicated.
However, the audience does not influence every aspect of development. Let us guide you through all of them.
1: Architecture
A thorough target groups – and market research enables the development of your own value proposition, which in turn can help in choosing the right architecture for an investment platform. In addition, fintech products usually require more scalability, security and compliance than, for example, e-commerce solutions, so their architecture must take this into account.
In general, there are several architecture types that we use most often, each one with its pros and cons:
- Layered architecture (aka N-tier architecture) – easy to launch but difficult to scale
- Event-driven architecture – good scalability and Performance but issues with eventual consistency
- Microkernel architecture (aka plugin architecture) – easy to add functionality thanks to plugins, but difficult to design
- Microservice architecture – great scalability but issues with Design and Test
Selecting an architecture type for a fintech project – or any software project – is an important but complicated step that requires specific skills t. Because of this, it’s best to leave this to a software architect who will carefully consider reliability, scalability, team composition, and other technical and business goals before making a decision.
2: Bank integration
Of course, developing fintech apps or investment websites requires integrations with financial institutions. Without this, the product is unable to obtain financial information about customers, their balances, transactions, credit history and more.
In the case of an investment app we developed, the integration allows users to receive their credit -Scores from banks after a short survey. Based on the data, each user receives a score, which serves as a basis for investment proposals. wp-content/uploads/2023/01/The-Functionality-of-the-Bank-Integration-ClearMinds.png” alt=”How to Create an Investment Platform 2″ />
3: Country and Time zone
The geography of an application is also an important factor due to the different regulations and opening hours of the banks integrated into the investment app, for example in England banks only post Monday to Friday from 9am to 6pm Information available.
However, these limitations do not mean that the application should not work on weekends.If, like us, you have encountered this inconvenience, you can make it invisible to users by extracting data from the extract latest updates.In this case, if a client submits an investment request on a Saturday, they will receive Friday’s investment rates, even though they may have changed.
4: Code logging
We have seen that third party integrations are essential to properly logging code errors to see what caused errors and how to prevent them.
Here is an example from our experience. The format of a third-party API changed and the transactions were no longer performed. However, it wasn’t clear what the actual problem was, as errors weren’t displayed correctly. This inspired us to create an error logging tool that logs each of our requests to the third party and their response to us. If an error occurs now, we will see it in the log list.
5: Sandbox environment
When choosing a third party or bank, make sure they have a sandbox environment Option feature code development. This helps avoid accidental corruption of user information or unwanted charges for using banking information.
What we mean by a sandbox environment is an exact copy of a third-party feature set that is risk-free to create a Connection to the source code establishes customer data. When you’re done coding, just replace the sandbox URL with a real one.
6: User Flow Evolution
How do customers see your service from their perspective? It’s important to carefully plan the way your platform will interact with users. What steps do they need to take to get results? What should registration, background check and investment process look like? Discuss each user action and its detailed flow with experienced development team.
This is an example of the registration form for an investment platform we have created. We had to leave some leeway in case the money didn’t go through or the investment didn’t happen on the same day for some reason. However, the next day’s exchange rates are different, which leads to a different investment result.
Nevertheless, we found a simple solution – limited use of the investment portfolio. This means that a certain amount of client assets remains available at all times in the event of exchange rate changes or transfer fees. rev-2c36593/blog/wp-content/uploads/2023/01/Suggestions-on-Investments-Distribution-ClearMinds.png” alt=”How to Create an Investment Platform 4″ /> We also took time to discuss the User flow taken to determine the best methods to notify users. Currently, there is no need to constantly check the website or app for the exchange status. Instead, the investment platform sends alerts when there is a good selling or buying opportunity.
7: Customize UX design
User experience design for investment platforms is difficult for several reasons.
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First, fintech solutions are notorious for huge spreadsheets and confusing ones Graphics with all sorts of statistics and summaries, so it’s important to place this information in an easily digestible and easy-to-navigate form (especially for web and mobile apps).
Secondly, the Regi Investing platform e-mails easily overwhelm first-time users. With 15-20 fields to fill out, it’s no wonder customers are in a hurry or don’t even make it to the last few questions. That’s a shame considering that these answers are crucial and the system needs to know as much as possible about its users for effective investment management.
However, a carefully designed UX can help mitigate this problem . Partly it can be solved with third-party integrations, like Open Banking, but that doesn’t make the form itself any less intimidating. So UX designers have to put themselves in the user’s shoes to create a flow that is understandable, user-friendly and easy to digest. Some ideas include breaking it up into multiple steps, placing the critical questions at the top, or gamifying the process.
We shouldn’t forget about user guides and notes either. They may not have the required experience or knowledge in specific areas or forms. Therefore, it is important to strike a balance between giving enough advice and overloading the user interface with pop-ups and notifications. Create an online investment platform that you would love to use.
A multilingual website or app can also cause you problems. In our case it was in English and German. We didn’t take into account the length of German words, which are usually much longer than in English, leading to some layout issues.
Having considered the architecture, integrations, user flow, and other facets of investment platform development, it’s time to start thinking about the features it should have.
The Key Features of Investment Platforms
We can roughly divide investment platform features into general and industry specific features.
The general features are those you would expect in all types of applications, not particularly fintech applications . These include:
- Personal accounts for storing all information about the user and their financial operations
- Real-time alerts um not to miss an important notification
- Multi-platform support to have access to the platform regardless of the device
- Analytics dashboards to see and compare results to make investment decisions
- 24/7 support to report problems immediately and get professional help etc.
However, it is more important to focus on the features inherent in investment platforms if you want to develop a truly useful platform. Here are the ones we recommend when building an investment platform:
Multi-currency accounts
Multi-currency accounts make it easy to receive and withdraw cash anytime, anywhere. As platforms strive to make investment markets more accessible to users, multi-currency accounts give them access to investment opportunities in different countries and currencies.
Unlike banks, which have a limited number of the most popular currency exchange options, The Multi -Currency functionality in investment platforms allows the exchange of all types of currencies. What’s more, it’s so much faster than a bank, with fewer fees and at a lower exchange rate because users can monitor real-time exchange rates and choose the most appropriate time to convert.
Automated investment advice
Software’s ability to quickly and accurately analyze vast amounts of data makes it a worthy advisor when it comes to making investment decisions. Consequently, an automated investment advisory function enables platform users to invest effectively.
This type of advisor can evaluate the user’s investment portfolio in real time, compare it with the market situation and show the optimal time to sell assets. Alternatively, if users want to invest in assets, an automated advisor can predict how much they will earn in a year (and if it’s even possible).
Investment Calculator
A handy help feature Investment calculators show users how their investment will grow over a given period of time. You need this information to make better, data-driven decisions.
For example, a user might want to invest in fast-growing, trending assets because they think they’re “hot.” But the calculator does not rely on emotions. Instead, it uses machine analysis and historical data to forecast returns and objectively assess an investment’s profitability.
Cryptocurrency Trading
If people are interested in investing, they almost certainly are Interest in cryptocurrencies. A fully functioning investment platform should take this into account and integrate with various cryptocurrency exchanges to allow buying and selling of different types of coins.
However, cryptocurrency trading is prohibited in some countries (China, Bangladesh, Egypt, etc. ) illegal ). Therefore, we recommend implementing this feature only if your target audience lives in countries that allow it (Canada, Germany, Slovenia, Estonia, Netherlands, Singapore, etc.)
Risk Profile Calculator
Risk profile calculators help to determine optimal investment approaches. Including questions that the user can answer to see their risk tolerance will help them better understand what they should invest in. However, it is important not to overwhelm the user: five to ten questions are enough. content/uploads/2023/01/Risk-Profile-Calculator.png” alt=”How to Create an Investment Platform 6″ />
Savings Goal Analysis
When users see their savings goals, is it is necessary to accurately calculate the probability of achieving them.This will also help you calculate the amount you would need to invest each month or so.
Investment Portfolio Review
Introduction of metrics like standard deviation or Sharpe ratio to manage the user’s investment portfolio The health check allows them to compare the difference between the actual user’s portfolio and the investment target.
These are some of the features included in The investment platforms, apps and websites developed by Django Stars are built in. This does not mean that every feature on this list should be included, nor does it mean that others cannot be added. In any case, it is important to have the features expected by the audience to in and to take into account the specifics of the platform model.
Investment platform models
The most general distinction includes B2B and B2C investment platforms. However, they can also differ within each group. The two most popular investment platforms we developed in Django Stars were both B2C, but for different audiences.
Clear Minds was an intuitive personal investment app with a very straightforward workflow: users download the application, invest their money and wait for the return.
But we have also worked for GLASfunds – a complex alternative investment and operations platform that enables the construction of bespoke private markets portfolios. The platform collects capital calls from private companies and distributes them to registered investors for a single management fee.
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To manage these and other operations, a system like this must have two portals:
- for users to see capital calls from different companies and the status of their investments
- for admins to manage the process, send reports to investors, see how many investors have committed and for what, who transferred their money or not, and generally manage the whole process
This is what the admin dashboard might look like:
How to secure data on an investment platform?
The security of a complex system depends on the weakest link in each subsystem. This means that data should be protected at every layer of an investment platform, website, web or mobile app.
For example, it is important to always use the latest TLS protocol (currently it is 1.3) to secure a website. It ensures secure encryption of data forwarded to the client’s browser over the public network. Incidentally, TLS 1.3 uses AES encryption with a 128- or 256-bit key, which is the gold standard in the industry.
But that doesn’t matter if the authorization and authentication processes are vulnerable. Simply put, it is crucial to protect investment platform users from their own actions. There are a number of ways to improve security on top of the standard login/password flow. The first thing to add is two-factor authentication. Depending on the user’s device, it could be a phone call, a text message, an authorization app, or biometrics (fingerprint, face recognition, etc.).
To go further, it’s a good idea to to do this allow users to manage active sessions opened from different devices. Adding an access or session log could help the technical support team or the user to locate fraudulent activity. In more innovative investment platforms, AI-based intellectual systems may do this instead.
If an investment app allows data sharing or limited access to third parties such as advisors or accountants, it will benefit greatly from granular access control and a detailed audit trail.
During the development process, the security of source code, infrastructure configurations, and cloud resources is also critical. All code repositories must be protected with the RSA cryptosystem, two-factor authentication for developers, strong password policies, and robust access control.
Trust in the development team is also important.
For example, Django Stars is ISO/IEC 27001 certified, which means customers can rest assured that we know how to protect data from cybercrime, security breaches, vandalism, corruption, theft and more.
In the words of Oleksandr Ryabtsev, our Backend Competency Lead, Django Stars controls security at different layers during development:
- The code layer. According to the SAST testing methodology, we ensure that the code does not contain any bugs that could make it vulnerable.
- The third-party app layer. We ensure that all third party services we integrate are up to date with their fixes.
- The deployment layer. Our DevOps engineers ensure that the cloud servers we provide software for do not have any OS level issues.
All in all, a tech team with experience in fintech Development best suited for building an investment platform according to industry standards and security requirements.
How much does it cost to create your own investment platform?
Investment platform development costs vary greatly depending on the specific ones Requirements and features requested. However, based on our general estimates for product development, it can take at least 200 man-days to develop an investment platform from start to finish.
However, it is impossible to accurately estimate the development costs without truly understanding the scope of the work. Factors that can affect development costs include the complexity of the platform and the number of integrations required.Is it MVP development, refactoring, scaling, or does the customer need to extend the previously developed MVP? Each of these requests differs in scope of work and consequently price.
Functionality is another aspect that increases development costs. Depending on the goals of the project in a certain development phase, the functions also vary. An investment app, which is just a concept to be shown to investors, has different functions than a POC. Not to mention that different software providers have different prices.
Ultimately, the cost of developing an investment platform is unique to each project and depends on the specific needs and goals of the client. Therefore, the best way to find out the cost of building an online investment platform is to ask.
When you contact us, Django Stars experts will interview you to determine project details and provide you with an estimate submit. After all, we have developed over 20 fintech applications and have some tips and tricks up our sleeve.
Our advice on developing investment platforms
After providing an investment platform for the Swiss market, a SaaS investment platform and numerous other fintech projects, we have learned the hard way how to make the development process smooth.
Here are the tips from our practical experience that you are welcome to use:
- Formulate the specifications and business logic of the future investment platform with very concrete examples.
- Skip the complicated business jargon and use it to describe the requirements in a simple way that the team could understand quickly and easily what to do.
- Remember that while engineers have experience building investment apps or websites, they are not fintech experts. Therefore, it is a good idea to provide them with simple and logical formulas and algorithms to calculate investors’ reliability coefficients depending on their portfolio. The same goes for calculating customer risks – timing of deposit, primary investments, etc.
- Make sure all team members are on the same page about the project. To avoid confusion about terms and their meanings, create a dictionary that explains each term. Consider conducting workshops for the development teams to explain the solution’s business logic and features.
- Don’t hold back on the cost of testing, as users will deal with every bug or error they encounter , lose confidence in your platform. When it comes to investment solutions, it is important to pay special attention to and test the formulas for calculating investment risks, portfolio allocation, etc. Because sometimes formulas that work well on paper or in MS Excel don’t work so well in code.
We have many more tips on architecture, data analysis, API integrations, and UI/UX of investment platforms. If you hear them and want to share your fintech ideas with us, don’t hesitate to contact us.
Summary
Investment apps are a hit because there is no minimum investment amount. but they must follow certain guidelines to grab users’ attention and gain their trust.
So, when thinking about how to build an investment platform, consider its architecture, integrations, geography, user flow, and experience more first. Then, together with the tech team, discuss the features you would like to see on the platform and whether or not they will be easy to implement. Finally, make sure the team knows how to secure user data in the investment app according to the latest industry standards.
Building an online investment platform is not an easy task – working with sensitive matters like finance is it never. For this reason, we recommend working with a software development partner who specializes in creating fintech solutions. Investing in their experience can become one of the best business decisions you make.
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