Are you looking to launch an investment app or offer wealth management products on your platform?
In this case, you are at a point where you need to make a decision of whether you want to build your own investing technology stack from scratch, or integrate with a company that provides embedded infrastructure for investing for launching investment products.
Building your own technology stack from scratch, to provide investment services to your users, involves a lot of time, effort, expert understanding to take the right decisions, and usually higher cost. Based on your target audience, use case, and business goals you evaluate and plan to move ahead with the best wealth management solution that suits your business.
Urge to build
Many companies want to build and own the entire backend because they feel that it is important to own the backend rather than purchasing it. We at tarrakki understand this point of view.
However, let’s look at the below advantages of using Tarrakki’s embedded infrastructure for mutual fund investing and investment products:
Tarrakki offers embedded investing modules for:
- MSMEs and Corporates
Tarrakki provides these differentiated fintech API modules which help companies to save a lot of time and effort in chalking out digital investment journeys for their target audience, and also making investment easy and accessible for such unique audiences. If they were to build this investing module out from scratch it would take them around 12 to 18 months which is quite time-consuming.
As SEBI now allows minors to invest in mutual funds, companies whose target audience is minors can introduce minor investing in mutual funds on their platform using Tarrakki’s infrastructure.
Tarrakki has made digital investing in mutual funds accessible for NRE/NRO accounts. This way companies targeting NRIs has an easy access to launch investment products for NRIs in a quick and easy way which in turn helps the companies to generate a new revenue stream.
Companies targeting MSMEs and Corporates can go for MSMEs investment module where they provide treasury management services through debt mutual funds.
Tarrakki also provides investment modules and fintech APIs for HUF, Individual, trusts which can be used by companies/fintech for their users.
There are a lot of regulatory changes in the mutual fund industry. Let’s look at some examples:
Change in mutual fund pooling guidelines: Initially the mutual fund distributors, online platform, stockbrokers, and investment advisors used to accumulate monies from mutual fund investors used to accumulate monies to the bank account (pool account) and then transfer the monies to the fund house to buy mutual fund units for the investors. As per the new SEBI regulations, the money must go from the investor's bank account to the bank account of the mutual fund house directly. This was implemented to prohibit the misappropriation of funds.
2 Factor Authentication required: According to SEBI new guidelines, a One-time Password is required to make financial transactions while Redemptions, Switch, Systematic Transfer Plan, and Systematic Withdrawal Plan on online platforms. This OTP goes on the investor’s mobile number or email id. So, it is important for the investor to have their email ids and phone numbers updated on the online platform. Online investment platforms have to stay updated about these changes and implement them.
Nomination rules: For mutual fund investors, it is now mandatory to submit the nomination details or opt out of nomination. Online platforms have to make this section mandatory and also validate the choice made through an OTP sent to the unit holder on his/her registered email or mobile number.
These regulations are made for the safety of the investors as well as to bring uniformity among all constituents in the securities markets.
After the change in pooling guidelines, 2FA for redemption and Nomination, online platforms had to make changes in their system in order to comply with the changed rules. Tarrakki’s embedded infrastructure for investment has got you covered during such regulatory changes. If you were to build out the investment offering from scratch, you would have to allocate time to make such changes in the system. With embedded investing infrastructure, Tarrakki takes care of all these changes and all you have to do is just integrate with Tarrakki to make use of our mutual fund APIs and investment product tech-stacks.
By integrating with Tarrakki, the end users using the investment product do not have to leave the platform to make an investment. The user remains on the same platform as the investment APIs are embedded into the partner’s app/platform. Thanks to white labelling and investment APIs, it feels like the user is on the same platform while using the feature.
Tarrakki's key USP is to reduce development costs by 80% and go to market 10X faster. Tarrakki has built reliable backend APIs that solve for onboarding, transactions, reconciliation, back-end operations.
What if you were to build out the investment offerings from scratch?
For building out an app for investment offerings from scratch, following points should be considered.
1. Integration with multiple vendors
Companies looking to offer investment products have to integrate with multiple vendors in the ecosystem which is quite time consuming and also map out user investment journeys.
Tarrakki has integrated with multiple vendors in mutual fund ecosystem just to launch mutual funds. These integrations includes: BSE, NSE, CAMS, K Fintech, AMCs, Morning star and many others. Tarrakki has packaged multiple layers from these vendor to build out the APIs for differentiated investment modules which abstracts the complexity. We also have user investment journeys mapped out for you.
2. Quick go to market
Building out the investment offering from scratch can take up to 12 to 18 months to launch.
If you are a big business and want to offer investment offerings to your end users as an extensible feature then in that case you would require a dedicated team that coordinates with multiple product teams, prioritize the requirements and then take the product live. This means that it takes time to launch even for big organizations.
By using Tarrakki’s tech to offer investment offerings one can go to market in as less as 7 hours using tarrakki’s white-labeled solution. Even tarrakki’s API integration solution can be used to go live quickly. No. of days depends upon the partners’ requirements.
3. Powering different use cases
If your end users are MSMEs and corporates, or NRIs, or HUFs, or minors, or individuals and you are looking to offer an investment option for them then Tarrakki has got you covered. Building a product for this target audience from scratch can consume a lot of time and also put a dent in your long-term product road map as it might take more time than expected.
Tarrakki has worked with different partners in the ecosystem to build out mutual fund investment modules for such a unique target audience. Integrate with tarrakki to offer investment products and focus on your core competencies.
4. Regulatory changes
If you were to build the investment offering from scratch you need a dedicated team to keep your system updated according to the regulatory changes.
Tarrakki takes care of the regulatory changes and all you need to do is just integrate with Tarrakki.
Tarrakki’s wealth management APIs are very developer friendly, secure and compliant and easy to configure and integrate. Tarrakki’s investment API solution gives you the flexibility to experiment with different things to enhance the user experience. We also take care of compliance issues, scale issues and legacy system issues.
Make a decision of whether you want to build or buy investment offerings based on the above information.