The Importance of Product Management in Fintech

Are you facing a great challenge in understanding and meeting the high expectations of customers in the Fintech industry?

Do you have your product in this industry but you don’t know anything about product management in the fintech industry?

This blog will help you in two ways:

1. Providing deeper insights on how to manage the product lifecycle of your clients.
2. Helping you to grow your own business in the fintech sector.

In recent years, the fintech industry has seen great growth. It has restructured the traditional financing system and landscape. As per STATISTA’S GLOBAL FINTECH MARKET REPORT 2023, the fintech industry is expected to cross the $460 billion benchmark, teaching us about the changes it can bring to in traditional financing base.

The Intersection of Finance and Technology

Being a product manager in a fintech company, you have the responsibility to develop nice financial products. The same was the case with Atharva. His boss told him to develop an authentic easy-to-use product for the customers. For the first time, Atharva got such a big responsibility. But he was smart enough to manage the entire situation. Before preparing any roadmap for the product, he took into consideration the following important things.

1. He developed the goal of understanding the rules and laws of finance. This was very important. It’s like keeping a secret machinery for product success.
2. He was keen on understanding the technologies like AI and blockchain which was like a big puzzle for him. However, he knew that before understanding the product and integrated technology, he could not make a successful product launch. In my blog on PRODUCT MANAGEMENT IN PHARMACEUTICAL INDUSTRY, I clearly explained the importance of knowing the product to the core.
3. Keeping a benchmark for developing a product and doing a SWOT ANALYSIS of competitors.
4. And most important of all his understanding of the pain points of the customer and creating empathy to resonate with the story of the customer.

Fintech Product Manager Role

Atharva was one of my colleagues in a previous project. So, I had an opportunity to ask him about the role of PM in product management in fintech. So here is my concise conversation with him.

Me: what is the main responsibility of a product manager in product management in fintech?

Atharva: our prime objective is to oversee the lifecycle of the product along with a good understanding of the technology used.

Me: what are the challenges faced in product management in fintech?

Atharva: the major challenges that we face are:

• Staying ahead in technological advancement.
• Balancing innovation with compliance. This is very important.

Me: What is the first thing that you will start with?

Atharva: I will prioritize the features based on the value of the business and the impact on the customer. Doing market research is very important to understand the customer impact.

Me: How do you do market research for your product?

Atharva: I start with concept development testing. Unless I am determined that my concept is good, I don’t go forward. Techniques like monadic testing, and sequential monadic testing help me a lot in this. Then I make a list of certain features of the product. I survey the feasibility of those features among the audience using the Kano model. It is one of the best tools for product management in fintech. After choosing the best-required feature, we move forward in making our prototype.

According to Atharva, “There is an increase in demand for fintech professionals. Companies are longing for persons with a unique blend of expertise in finance and also proficiency in technology. So that makes product manager essential in steering fintech initiatives.”

Navigating Regulatory Frameworks

Product management in fintech poses multiple challenges in balancing all regulatory frameworks. This has profound implications for product managers.

Protection of user information and prevention of crimes related to money are very important. Product managers must be updated about all the changes in rules. All the rules must be followed because any breach of rule can result in big fines and also legal troubles.

Following all the rules and regulations properly and balancing all the compliances always keeps the company in the spotlight and builds the good reputation of the company and also the product managers.

Technological Trends Shaping Fintech Products

As I have already highlighted the knowledge of technology before managing any product. Atharva was keen on understanding the technology so he went to the technical expert of his company to understand the basics. Ultimately a product manager has to manage both the development team and the marketing team and synchronize them for the proper launch of the product. So, his technical expert told him certain important points.

He asked Atharva, “Ever heard of blockchain? It is a super secure digital ledger which makes all kinds of financial transactions safer.” He taught Atharva the basics of blockchain. He also talked about the importance of AI and machine learning in analyzing the data and predicting. Prediction plays an important role in shaping the product.

Robotic Process Automation was also highlighted well by technical experts because it automates repetitive tasks and also helps in streaming processes to create better products. According to Atharva, its very essential for product management in fintech. I asked Atharva what other essential technologies must be integrated.

Atharva: Biometric authentication like fingerprints, face recognition, etc. enhances financial security in transactions. Along with this quantum computing, IoT, and cyber security technology also play an important role in building a product.

Developing a User-Centric Design

As Atharva already told me he selects the most preferential features using the Kano model to develop the product. So, I wanted to know some practical implications of that from the experience of the latest product developed by the company and the role of Atharva as a product manager.

His response made me very overwhelmed. He said that the success of a product doesn’t come from codes and algorithms but from crafting good experiences that speak to the users one-on-one. He made a money app.

Application had:

• Cool features that guided users through the entire payment journey. It was designed in a way to create a fun experience for the users.
• People found that the application understood them properly and this made handling the money easier. So this increased the word-of-mouth marketing of the product.
• Product built a good empathy. It was a plot point and the UI was like a portal inviting users on an exciting journey.
• Big data is like icing on the cake. It makes product managers understand how people use money apps. It can spot problems and predict them. So the app becomes safe for users.
• Big data has also helped in creating personalized apps and also helps in iterations

Product Launch

As I have already told the importance of market research in product management in fintech. But along with user-centric design and good value proposition, strategic partnership is very important for product success.

Here are the 4 important ways of negotiating for partnership:

1. Negotiation must be interest-focused so that the interests of both parties can be taken care of.
2. Develop the criteria for negotiation before the meeting. Make the list of expected results that you want to achieve and then go on for negotiation.
3. Always focus on mutual gains. Profits of both are very important.
4. Separate the people from problems. Never allow your grudges to ruin your negotiation and partnership.

Along with this always be ready with scalable infrastructure, contingency plans, and data security measures.

User Feedback and Iterations

Atharva told me that this is the treasure map. If the user points out any confusion, then we have the chance for some insightful improvements. It also helps in the incorporation of customized features and hence

we are creating personalized enhancement for users. Feedback helps in the correction of any bug detection. This helps our product in iterative evolution. The product that has to stand the test of time has to adapt and evolve. This can also make our product ever relevant. Ex: if we integrate real-time updates in the product after proper feedback iterations then our product will become ever relevant.

Global Landscape

The fintech industry can bring financial services to underrated populations across the globe which also helps in driving financial inclusivity. Mobile banking is a great example. To expand the business globally, some important prerequisites have to be taken care of.

1. Regulatory compliance in any particular country.
2. Cultural sensitivity of any area.
3. Rate through which countries adopt the technology.
4. How diverse is the market?
5. Global collaboration

Future Trends and Innovation:

Today there are many fintech corporates and new startups are developing every other day in the market. Following the trends and observing my clients and their thinking process, I have made certain list of future trends in the fintech industry that will also prepare product managers to make proper frameworks for product management in fintech.

1. Personalization which is AI-driven: today we can see the use of artificial intelligence everywhere. Many great tools like ChatGPT, BARD, etc. are freely available to us. Under this situation, financial decisions, solutions, and even payments are going to be integrated with AI.
2. Blockchain applications: the cryptographic principles of blockchain enhance data security which ultimately reduces the risk of fraud. Financial transactions become more transparent which increases trust. Smart contracts help in the automation of all the processes which reduces the dependency on mediators.
3. Cutting-edge technologies: its reshaping the industry. As discussed, Quantum computing, 5G connectivity, Internet of Things are allowing fintech product managers to stay ahead of the competition through various innovations. It also provides users with advanced, efficient, and secure financial solutions.

Conclusion

Going through the delicate journey of product management in fintech involves an exciting path- starting from the ideation stage and continuous testing to a successful product launch. The journey is iterative and is blended with continuously developing technologies, highlighting the adaptability required in the fintech universe. As we spy on future trends and innovations, it is clear that the coupling of cutting-edge technologies will surely normalize financial solutions. Fintech product managers who understand all this must be ready to pioneer it. From here to the future innovation has become a bright journey in the an ever-evolving layer of product management in fintech.