Entering the fintech market is challenging, but it can also be a game-changer. Read how peer-to-peer mobile payment systems are proving to be a revolution.
The advent of peer-to-peer mobile payment apps with blockchain has created a new world of cashless, card-free, and pay-contactless transactions. Blockchain app development for cross-industry fintech applications and use cases range from splitting bills, making remittances, and booking tickets to managing daily expenditures.
Blockchain-built fintech applications are set to transform the way we make online payments with the availability of digital wallets, cryptocurrencies, m-commerce apps, and peer-to-peer payment apps. Several next-gen peer-to-peer mobile payment apps now support card-less, cash-less, and in some cases, bank-less transactions.
So let’s have a look around at mobile peer-to-peer payment systems that are proving to be a revolution on a global scale.
At its core, a peer-to-peer (person-to-person) payment app is a mobile application that enables users to perform electronic money transfers. P2P mobile payment apps have a range of use cases that include:
P2P payments are not only limited to geographical locations, but users can also perform cross-border transactions.
Person-to-person foreign currency exchange applications aim to bring users together worldwide. They eliminate intermediaries, such as banks, and brokers, which results in up to 90 percent cost savings on international exchange and transfer fees.
P2P lending platforms enable users to avail of repayable microloans at lower interest rates than banks. These platforms are more beneficial for investors looking to monetize their funds in fragments.
Also Read: The Impact Of Blockchain Technology On Peer To Peer Lending
They offer cheaper transaction provisions as compared to their traditional counterparts. Now, technologies like smart contacts make it possible to make secure payments via a smartphone app.
Peer-to-peer mobile payment solutions vary as per the requirement of the work areas, such as airtime transfers, travel and ticketing, and merchandise and coupons. Their industry applications include fields like retail, travel and tourism, hospitality, logistics, energy, utilities, etc.
Companies looking to develop a mobile-based peer-to-peer money transfer system can consider developing one of the four types of business applications.
Several banks are considering deploying mobile payment applications to customers. It ensures that merchants have the necessary PoS (Point-of-Sale) acceptance provision.
These applications provide online P2P/C2B payments with or without checking accounts and debit/credit cards. Generally, these apps come with an integrated wallet. Also, take a look at cryptocurrency wallet development services.
Social media payment solutions enable users to make frequent payments to people they regularly connect with. It is the reason that several payment applications are integrated with messaging apps.
These applications enable money transfers within their product network or ecosystem. In such a payment application, ‘Payment’ is generally a default device feature rather than a standalone app.
Now, it might look complex to develop a peer-to-peer payment app, with so many peculiarities and big players already dominating the market.
However, we have made it simpler with the following steps that you need to consider before developing a P2P payment app.
Technological advancements lay the foundation for developing new, innovative business models. They provide efficient solutions for value-adding to consumers and making businesses more self-reliant.
Then, we should consider the following emerging industry-transforming technological advancements.
Real-time transactions or payments (RTM technology) enable the existing payment solutions to achieve faster transaction speed. Also, they provide essential messaging capabilities and immediate updates on transaction status.
DLT-based technology like blockchain and smart contracts facilitate solutions that provide enhanced security and cost-efficiency.
Migration from legacy and pricey systems to a single blockchain-based platform can provide more affordable payment solutions.
So now let’s explore one use case based on the aforementioned factors in the payment p2p app development.
According to the MIT Technology Review, Airfox is a highly acclaimed startup with revolutionary financial solutions. Airfox aims to develop a new system that serves people who have limited access to banking with reliable, egalitarian, and democratic access to financial services. It is a revolutionary peer-to-peer microloan lending and disbursal system that uses ERC-20 tokens issued on the Ethereum blockchain.
The app facilitates users to make peer-to-peer payments and avail loans. For instance, a user initially deposits its Airfox integrated wallet and conducts payments through the app. Further, the application improves the credit score based on certain predefined parameters, which makes a user eligible for more efficient loans.
The company aims to create its all financial instruments using blockchain to have anyone worldwide finance their users.
When it comes to developing a payment system, security and standardization are the paramount factors. Additionally, preventing fraud and other issues is another way to ensure long-term success.
A decentralized peer-to-peer system must have a strategy in place to set up resource allocation and protection requirements. Particularly, they need to prevent two types of attacks: DoS and storage flooding.
As the fintech market is growing, it also needs to fulfill regulatory demands while also adhering to complex laws.
A focus should always be on how to deliver quality UX to features that can stand the test of time, instead of experimenting with functionality.
P2P networks are more affordable, easy to maintain, quick, and reliant than centralized systems. However, one thing that hampers their widespread adoption is security. At the same time, it is of paramount importance in online payments. Both data transmission and storage always remain at high risk. It is where blockchain technology comes into play and enables blockchain application developers to deliver the benefits of peer-to-peer networks.
For instance, a blockchain-based payment system can use the Rich Communication Services protocol (RCS) to replace SMSs with the text-messages system that provides phonebook polling and in-call multimedia transmission. A similar protocol has already been tested by a Japanese company SoftBank for P2P transactions between mobile users.
Blockchain application technologies that can be used to further enhance the development of a p2p payment system
Entering the market of fintech development is challenging, but at the same time, it can be a game-changer. We have the requisite expertise in providing efficient fintech application development services with blockchain technologies. If you're looking to enter the development space of the Fintech market, connect with our blockchain specialists today!
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