Need to get some money ASAP? You can turn to banks, friends, or family. But there is a better, smart option available anywhere at any time — loan lending apps. Meanwhile, the tech behind money lending apps has changed the world of finance forever. So, finding the correct answer to the question “how to create a money lending mobile app” promises to be a great start for your successful business future.
According to Statista, by 2025, the value of global digital peer-to-peer lending is expected to reach $1 trillion. Our newest article will help you get a clear image of loan app development to hold the top spot. Let us be practical!
Senior Software Developer, Qulix Systems
Study the Loan Lending Market
First, let us have a look at the situation in the lending market. According to the Global Lending Market Report 2020–2030, the COVID-19 outbreak caused a massive decline of personal and business bank loans due to the overall economic slowdown. In 2020, this fall reached a CAGR of -1.9%. But in 2021, the global economy demonstrated the increasing interest in lending — the growth of the worldwide lending market was marked at almost a CAGR of 6%. The experts expect the global lending market to reach $ 7.9 billion by 2023.
Money Lending Apps — the Fuel for the Post-Pandemic Economy
Why are loan lending mobile apps growing in popularity today? One of the apparent reasons for that is the impact of the pandemic. Many projects and businesses had to be stopped due to a lack of investment.
The difficulties of lockdowns, recessions, and business disruptions have also led to massive transformations and a shift to digital reality for many industries. According to Numerated, 82% of US businesses apply for online loans.
That is why we see the ongoing popularity of money lending mobile apps. Therefore, the modern loan lending market today is:
- an alternative bank-independent source of investments and funds for SMEs, freelancers, and gig workers;
- a convenient online marketplace for private investors and personal loans;
- an extensive holder of opportunities of P2P lending opportunities with interest rates.
No wonder when it is inconvenient or even impossible to loan money from a bank, people and businesses turn to more flexible lending mobile apps. In addition, AI integration, data analysis, and blockchain technologies have taken loan lending apps to the next level of accessibility, affordability, and security. So, creating a loan lending mobile app is an excellent business idea today.
Define Your Lending App Strong Points
Apart from convenient financial services, what are the other benefits of a mobile app for lending? How will your product make its bones? You should have a clear vision of all its strengths for your clients. We highly recommend you focus on empowering your users with the following features:
- better privacy protection — all financial and private data within the app is confidential; it is also applied to the reasons for lending money;
- upgraded security — encryption and tokenization bring the data security of loan applications to the next advanced level compared to traditional loan services;
- organized records — cloud storage integration of the lending process makes keeping financial records easier; users can get access to their loan history anywhere at any time;
- various lending options — modern loan apps offer a much more comprehensive range of money lending services, adjusted to the customers' individual needs.
According to Grand View Research, the global digital money lending market will expand at a CAGR of 24% from 2021 to 2028. That's a great business opportunity, isn't it? So, now is the right moment to introduce your best money lending app here and now.
Choose Mobile App Loans
What types of loans will you offer your customers? The answer will determine the strategy of your loan lending app development process in its entirety.
There are two major types of lending apps today — for personal and business loans. So what are the most popular loans in these categories?
No doubt, for businesses, loans are vital financial assistance tools. They are a strategic source of investments in assets, operations, infrastructure, etc. Loan lending mobile apps can significantly intensify support for various businesses, especially these days.
There are several types of business loan applications that are in high demand today:
- Short-term loan apps. They supply everyday business operations and infuse liquidity to deal with a cash shortage or an irregular money flow.
- Term loan apps. They are usually more considerable in amount. Businesses turn to them to cover specific needs. Nevertheless, mobile business loans are generally limited by value — the average max for this type is about $50,000.
- Startup loan apps. They are a good fit for companies that operate for less than one year. As such businesses often can’t use usual business lending programs, they can turn to a specialized service. Startup financing comes in multiple solutions like microloans, crowdfunding, or personal business loans.
- Equipment loan apps. They are used to maintain necessary equipment or upgrades. A loan app for traders or manufacturers will significantly add up to the operational support of businesses.
- Trade loan apps. They are provided by suppliers. In this lending app, your business can get some goods and arrange to pay for them later. But if you are in arrears, you will have to pay higher rates.
As for the most popular lending apps for personal accounts, there are several widespread types, including:
- Payday loan apps. They offer access to quick cash to hold until the following paycheck. The rates are high, and you have to repay at a definite time frame, usually within a month.
- Instant loan apps. They provide the most accessible funding and fast approvals and require little documentation. But you have to repay with the highest rates.
- Debt consolidation loan apps. They are used to pay off debt balances more quickly and save on interest. You can secure a lower interest rate loan to pay on your current debts.
- Mortgage loan apps. These loans usually carry the lowest interest rates but require a lot of documents and a severe process of approval. Here, a specialized money lending app helps find the best offers and create an optimal payout roadmap.
- Personal loan apps. They are platforms for money and loan management. You can consolidate all your debts in one place and follow the student loans, mortgage, and other payouts terms.
So, before launching the loan lending app development process, try to understand the target audience of your future application and choose the best type for your money lending app to cover your clients' pain points.
Arrange the Structure of Your Money Lending App
What are the must-have requirements for a loan lending mobile app? Actually, any application of this kind consists of just four basic steps:
- providing details,
- choosing a loan,
- availing the loan.
Moreover, the clever functionality in your app should be perfectly organized not only for users but for lenders and admins as well. So, think carefully about providing the best possible options for all those involved.
Below, we have selected for you the mainstream ones.
User Panel Options
Let us start with the list of features your users will need for lending.
- Onboarding and Registration. Arrange an intuitive but effectively protected sign-up process. It will ensure your clients' secure financial transactions and sensitive data entry. Multifactor authentication is a must for any lending mobile app today.
- Bank Accounts Synchronization. This option allows receiving and paying out loans. So, the connection to banks' APIs should be fast, easy, and reliable.
- List of Available Loans. Inform your app users about the variety of loans available for them. Smart recommendations based on their credit score and other data can show the best banks' and lenders' offers.
- EMI Calculator. This tool estimates the total EMI for all the loans that the users applied for. It is an excellent option if you accompany the loan calculator with smart recommendations and optimal roadmaps for money lending.
- Applying for Loans. This critical feature of a mobile lending app will help your users get the necessary funding right in the application. So, supply them with the complete guidance of requirements to get their loan requests approved.
- Transactions History. All the transactions should be easily arranged and displayed in a loan lending app. It also helps use data for monitoring and advising tools and innovative customer assistance.
- Push Notifications. Keep your users alerted about existing loans and payday terms. Notify them about the latest offers and discounts on the spot.
- Online Support. This is an essential feature for customer loyalty retention. The 24/7 customer service of a loan lending mobile app will help answer any queries or issues in real-time and meet clients' expectations and requirements.
Lender Panel Options
When you are targeting not only to encourage users to apply for loans but also to provide services for lenders, your P2P lending mobile app needs a particular additional set of features for investors.
- Account Management. This tool is for arranging personal accounts and creating individual lending plans and offers. Allow your users to adapt and edit the details of loans if something changes.
- Requests Handling. Provide a comprehensive panel to enable the lenders to accept or deny loan requests. Smart assistance and recommendations within your mobile lending app will be a handy addition.
- Lending and Payment History and Notifications. The lender panel requires a specified option for monitoring all their money flows.
- AI-Empowered Analytics. Investors need advanced tools to evaluate KYC details about their potential borrowers.
Admin Panel Options
A money lending app should also have a comprehensive set of admin features.
- Accounts Verification. This tool will allow the admin to verify the accounts and ask for additional details.
- User Management and CMS Integration. This feature will provide instruments to arrange the users, the content, and the elements of a mobile lending app.
- Analytics and Reports. A specific set of detailed reports will help the admins see the complete picture of loans and payments and improve the performance of a money lending app.
So, you should decide how to build your application with all the necessary features and add your innovative options to provide your users with a top-notch money lending app.
Proceed to Loan Lending App Development
Then comes the development stage when you have to think about how you will put all the features of your lending mobile app together.
It is crucial to choose a reliable software development partner for the effective delivery of your project. Agile methodologies have proved to be the best-tested approach for lending mobile app development. The balanced and focused team consists of several specialists:
- a product owner (a business analyst),
- a Scrum master (a project manager),
- a solution architect,
- UX/ UI designers,
- QA engineers.
Furthermore, you should ensure that the loan lending app development team is meticulous about regulations compliance (the GDPR, the CCPA, and other regulations) and robust security measures.
So, try to stick to our practical guide on how to build a loan app. Start with studying the markets and your target audience, determine their pains and make a road map to mitigate them. And equip your product with all the necessary functionality for borrowers, lenders, and admins and provide reliable security and smooth operation on all the stages of your app development process. Furthermore, the innovative approach to creating the perfect structure of your loan lending app is the primary concern for the next leader of online loan lending apps.
Do you think that all that is too laborious and challenging? Well, turn to our professional loan lending app developers. We will artistically combine mobile, web, and cloud technologies to create high-performance fintech solutions.
If you want to launch your loan lending mobile app on Google Play or the App Store and have a plan, or when you don't know where to begin and need professional advice, contact us. We will help turn your idea into reality.