How Do Fintech Companies Build SaaS Products That Compete with Banks?

Summary

Fintech companies are changing the way we manage money. By creating fast, smart, and flexible Software-as-a-Service (SaaS) products, they are competing directly with traditional banks. This blog explains how fintech companies build these powerful tools, the strategies behind them, and why they work better for many users today. We’ll also explore real-life examples and share key insights from 2024–2025.

Introduction

In the past, banks had total control over how people accessed financial services. But that has changed. Fintech companies now offer everything from digital wallets to AI-driven loan apps. Most of these tools are built using the SaaS model cloud-based software that users can access from anywhere.

SaaS has made it easier for fintech firms to launch fast, scale quickly, and update constantly. The result? Products that feel smarter, more personal, and more efficient than traditional bank services.

But how exactly do fintechs build these products? And what makes them so competitive with big banks? Let’s break it down.

Stats: Why Fintech SaaS Is Winning in 2024–2025

• In 2024, global investment in fintech SaaS startups reached $45 billion, up from $32 billion in 2023. (Source: CB Insights)

• 73% of customers under 40 say they prefer fintech apps over traditional banking platforms. (Source: McKinsey, 2024)

• SaaS-based fintech apps are growing 2.5x faster than traditional banking products. *(Deloitte Fintech Report, 2025)

  *

1. Understanding the Fintech SaaS Model

SaaS, or Software-as-a-Service, means delivering software over the internet instead of installing it on local devices. This model allows users to access services anytime, anywhere.

Key Features:

• Cloud-based infrastructure

• Subscription pricing

• **Fast updates and scalability

  **

For fintech, SaaS makes it easier to build products like loan management platforms, budgeting tools, and investment apps without the burden of legacy systems like banks have.

Example: Highen Fintech has helped startups launch fully functional loan management platforms in just 3 months by using a SaaS-first development approach.

2. Building for User Needs (Not Legacy Systems)

One reason fintechs move faster than banks is because they build for modern users, not outdated systems.

What They Do Right:

• Start with customer pain points long loan approval times, hidden fees, poor mobile UX.

• Design products that are mobile-first, easy to use, and transparent.

• Use agile development, meaning features are rolled out quickly and based on real user feedback.

Real-life Example: In 2025, a fintech startup partnered with Highen Fintech to launch a digital wallet that lets gig workers access daily earnings. The bank’s similar project took over a year and still lacked mobile features.

3. Leveraging AI and Automation

Artificial Intelligence (AI) is a game-changer in fintech SaaS development.

Benefits of AI in Fintech SaaS:

• Faster decision-making: Instant credit checks or fraud detection

• Personalized user experiences: Spending alerts, smart budgeting tips

• 24/7 service: AI chatbots answer queries at any time

According to a 2025 study by PwC, 64% of fintech SaaS platforms now use AI to improve service delivery and security.

Example: Klarna, a fintech offering “Buy Now, Pay Later” services, uses AI to assess creditworthiness in real-time something many banks still struggle to do quickly.

4. Using APIs for Flexibility and Speed

APIs (Application Programming Interfaces) allow different software systems to talk to each other. Fintech companies use them to connect with banks, credit bureaus, or even cryptocurrency wallets.

Why APIs Matter:

• Allow fintechs to integrate with financial data sources

• Enable modular design so features can be added or removed easily

• Improve time-to-market by using **existing services

  **

Example: Plaid provides APIs that connect fintech apps to users’ bank accounts. This allows budgeting apps to pull in transaction history in real-time.

5. Staying Compliant with Global Regulations

Fintech companies know they’re playing in a regulated space. That’s why modern SaaS products are built with compliance by design.

How They Do It:

• Use cloud platforms with built-in data security tools

• Work with legal experts to ensure GDPR, PCI-DSS, and KYC/AML compliance

• Build systems to log, monitor, and audit user activity

Stat: 82% of fintech SaaS firms in North America now embed automated compliance tools from day one. (Accenture 2024)

Tip: Need help building a compliant SaaS fintech product? Contact Highen Fintech for expert assistance in launching fast and secure platforms.

6. The Power of UX and Design

User experience (UX) is one of the biggest reasons why fintechs outshine banks. They focus on clean design, easy navigation, and clear language.

UX Best Practices:

• Onboarding in under 2 minutes

• Visual dashboards with charts and spending categories

• Human-like chatbot support

Example: The fintech app Revolut grew rapidly thanks to a slick design and frictionless UX. In contrast, many banks still have clunky interfaces with too many steps.

7. Continuous Improvement and Scaling

SaaS means updates can be pushed live without users needing to download anything. This helps fintechs:

• Test new features quickly

• Scale to new markets fast

• **Respond to user feedback

  **

Highen Fintech regularly supports clients with post-launch optimization, helping them roll out new features and performance improvements every few weeks something traditional banks cannot match.

Conclusion

Fintech companies are not just competing with banks in many ways, they’re winning. By using SaaS models, they build smarter, faster, and more flexible financial tools. They focus on user needs, integrate AI and APIs, follow strict regulations, and design products people love to use.

Banks, on the other hand, often move slowly, limited by outdated systems and processes.

If you’re a startup or financial company looking to build the next big fintech SaaS product, partnering with the right team is critical. Highen Fintech has deep experience in designing and developing fintech apps that scale, stay secure, and delight users.

Ready to build your SaaS fintech product? Contact Highen Fintech today.