Fintech App Compliance Guide: Key Regulations, Challenges, and Trends

Key Takeaways:

• Fintech compliance requirements protect user trust, secure financial data, and ensure your app scales safely in regulated markets.

• Global regulators like the FCA, SEC, MAS, and other regulators set region-specific rules, making early fintech app compliance planning essential for market entry.

• Data privacy, KYC, AML, payment security, licensing, consumer protection, and cybersecurity are the key elements of a strong fintech app compliance checklist.

• The challenges in meeting fintech app compliance include strict and fragmented regulations, costly implementation, as well as rapidly changing scenarios.

• Meeting data privacy laws such as GDPR and CCPA helps prevent costly breaches and ensures lawful data handling.

• KYC, AML, and CTF safeguards reduce fraud and cybercrime by verifying users and monitoring suspicious transactions.

• Regular audits, reporting, and cross-border compliance keep fintech apps audit-ready and expansion-ready across global markets.

• AI-driven monitoring, stricter data localization, open banking, and crypto regulations are the key future fintech app compliance to be followed.

Fintech App Compliance Guide: Key Regulations, Challenges, and Trends

Fintech is not just an abbreviation, but a much wider term covering diverse industry verticals. From banking to insurance, lending, and other financial services, the sector encompasses everything that involves a monetary element. 

The global fintech sector is expected to reach $1.5 trillion by 2030, which is almost a 6x growth from $245 billion currently. Hence, for an entrepreneur, the sector offers a growth opportunity to be focused on. 

But the fintech space is not as simple as building an app, making it live, and just chasing downloads. As they deal with sensitive personal and financial information, these apps are required to comply with industry laws and regulations. 

Failing to comply with these fintech app regulatory compliances can impact your users’ trust, app scalability, and even result in your app being banned. That’s why building compliance into your fintech app from day one isn’t optional, but is essential.

If you are building your fintech app compliance checklist, then this blog is your ultimate guide, which can help you better understand the compliance requirements for your fintech app. 

Why is Financial Compliance Important?

The global fintech space currently has $250 billion in revenue, with the potential to reach up to $13 trillion by leveraging the current and emerging trends. However, while focusing on such trends, the potential threats should also be considered. 

As per recent reports, the cyberattacks are increasing by 65% Y-o-Y in the fintech space. Hence, for a sector that deals with money and finances, any loophole can drain users’ wallets. 

These are not just the data that statisticians use to prepare annual reports. But these statistics also indicate the need for strong fintech compliance requirements. 

These compliances bind the fintech firms to take strict measures to protect users’ personal and financial information. 

However, these regulations and compliances for fintech apps can vary across regions or countries. Hence, the fintech firms need to focus on specific compliances that apply to their fintech app and implement it accordingly.

Revenue Distribution of Top Fintech Segments:

Major Fintech Regulators Across The World

A single entity rarely handles fintech compliance requirements across the global fintech space. Rather than that, jurisdiction-wise agencies and regulators exist that govern the financial sector and activities, depending on their legal, economic, and institutional setup. 

Hence, depending on the region or jurisdiction you are planning to launch or expand your fintech app, you need to be aware of the regulatory authorities. Such can plan your fintech app features that can support your mobile app security and scalability. 

Let’s focus on the major fintech regulators that you must be aware of. 

Fintech App Compliance Checklist To Be Followed

Fintech App Regulatory Compliance plays an essential role in the success and scalability of your fintech app. 

Hence, rather than making assumptions, it is better to plan for a detailed fintech app compliance checklist that can guide you and your developers on what to follow and what not. 

Let’s focus on a practical checklist that every fintech startup or firm should focus on.

1. Data Privacy and Protection

Fintech apps deal with sensitive information like bank details, IDs, and personal addresses. Hence, check for the compliance for fintech apps around the world on how you collect, store, and use this data.

► Global Standards

The GDPR in Europe requires apps to ask for clear consent, only collect what they need, and give users the option to delete or export their data. In the US, the CCPA and GLBA regulate financial data privacy. Other examples include Brazil’s LGPD and Singapore’s PDPA.

► Technical Safeguards

You must use strong encryption, secure servers, and strict access controls. GDPR also requires “privacy by design,” which means you must build privacy protection into your app from the very beginning. 

► Compliance Consequences

Focus on the compliance consequences, as breaking privacy rules can cost millions. GDPR fines can reach 20 million euros, or 4% of annual global revenue, as well as impact users’ trust.

2. Know Your Customer (KYC)

KYC rules make sure that only real, verified people use your app. This protects against fraud and illegal activities.

► Regulatory Frameworks

Check for nation-specific frameworks. In the US, KYC is enforced by FinCEN under the Bank Secrecy Act. In the EU, AMLD5 and AMLD6 cover customer verification. Countries like India and Singapore have their own KYC laws.

► Implementation Practices

Most fintech apps ask for a government ID, then match it with a selfie or biometric scan. For high-risk accounts, you may also need to check extra documents like proof of income or business ownership. Many companies use third-party verification services to speed up the process.

► Ongoing Monitoring

KYC isn’t just one step during sign-up. You must keep monitoring accounts for changes. If a low-risk user suddenly starts moving large sums of money, you may need to re-verify them.

3. Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF)

AML and CTF rules focus on stopping criminals from using your app to hide or move money illegally.

► International Standards

The Financial Action Task Force (FATF) sets global standards for AML and CTF. Countries then enforce them through local regulators like the FCA in the UK, AUSTRAC in Australia, and FinCEN in the US.

► System Controls

Your app must monitor transactions in real time. Look for suspicious behavior, like splitting large sums into smaller amounts to avoid detection (known as smurfing). You also need to screen users against international watchlists of banned individuals or organizations.

► Reporting Obligations

If you find something suspicious, you must report it to regulators. In the US, this means filing a Suspicious Activity Report (SAR). Failing to do so can result in fines or even losing your license.

4. Payment Compliance

Your fintech app compliance checklist must include payment rules that protect both users and banks. If your app handles payments, compliance is not optional.

► PCI DSS Standards

If your app accepts credit or debit cards, you must follow PCI DSS v4.0. This standard covers how to encrypt payment data, control who can access it, and test your system for weaknesses.

► Regional Payment Directives

Europe’s PSD2 law requires strong customer authentication and secure APIs for open banking. In the US, NACHA rules govern ACH payments. Each region has its own rules, so you must adjust based on where you operate.

► Business Continuity Impact

If you don’t comply, card networks like Visa and Mastercard can cut you off. Without access to payment rails, your app cannot function.

5. Licensing and Registration

You need the right license to operate a fintech app. The requirements depend on your target market, where you are planning to launch your fintech mobile app idea.

► Regional Licensing Bodies

In the UK, the FCA gives licenses to electronic money institutions. In Singapore, it’s the MAS under the Payment Services Act. In India, the RBI regulates fintechs, and in the US, you may need licenses in multiple states plus oversight from the SEC or CFTC.

► Ongoing Compliance

A license is not permanent. You must file reports, renew on time, and sometimes maintain minimum capital levels. If you miss these steps, regulators can suspend or cancel your license.

► Scaling Across Borders

When you scale into new countries, you must start with the licensing process again. Each regulator has its own fintech compliance requirements, and approval often takes months or years.

6. Consumer Protection

Customers expect fairness and honesty from any financial service. Regulators make sure fintechs treat users with respect and transparency.

► Regulatory Expectations

In the UK, the FCA has Consumer Duty rules. In the US, the CFPB enforces consumer protection. In the EU, the EBA requires clear communication of fees and terms.

► Operational Requirements 

Your app must show fees clearly, explain terms in plain language, and give customers a way to resolve disputes. A strong customer support team is also part of compliance.

► Reputation Risks

If customers feel cheated, they’ll leave your app, and regulators may step in. Robinhood’s troubles in the US are a good example of how poor consumer protection can hurt a fintech brand.

7. Cybersecurity Framework

Fintech apps are commonly the targets of hackers and cybercriminals. That’s why regulators expect strong cybersecurity controls.

► Standards and Frameworks

Many fintechs follow ISO 27001 or the NIST Cybersecurity Framework. The EU enforces ICT security rules, and Australia has APRA CPS 234 for financial services. Also, frameworks are being established to promote AI in cybersecurity.

► Required Safety Measures

You need tools for 24/7 monitoring, systems that detect intrusions, and regular penetration tests. Having an incident response plan is critical, so your team knows exactly what to do if a breach happens.

► Breach Notifications

Under GDPR, you must report a data breach within 72 hours. Similar requirements exist in the US and other countries.

8. Audits and Reporting

Your fintech app should comply with the audit and reporting guidelines. Regulators look for evidence that your app follows the compliance for fintech apps. Hence, reporting is the only way to prove that such compliances are being followed.

► External Audits

Some regulators require annual third-party audits, like MAS in Singapore, for AML compliance. The FCA in the UK also expects routine compliance reports.

► Internal Audit Practices

You should run your own audits regularly. Keep logs of customer data handling, security checks, and compliance reviews. This helps you stay ready for external reviews.

► Reports to Regulators

You’ll often need to file regular reports. These can cover suspicious transactions, risk assessments, or customer complaints.

9. Cross-Border Compliance

Growing across borders brings new challenges. Each transaction may be checked by regulators in more than one country to ensure your app aligns with the fintech compliance requirements. 

► International Standards

The FATF sets worldwide AML and CTF rules. In Europe, SEPA rules apply to cross-border payments. The US has its own requirements through FinCEN.

► Risks of Non-Compliance

The sending and receiving countries often have different rules. Some countries also have strict limits on how money enters or leaves.

► Risks of Non-Compliance

If you don’t follow the rules, your payments may be blocked, your accounts frozen, or your business banned from global banking networks.

10. Data Localization Laws

Data localization is becoming a major compliance hurdle as more countries demand onshore storage of sensitive financial data.

► Regional Mandates

Russia enforces data localization for all personal data. China’s Cybersecurity Law mandates that critical data infrastructure remain onshore.

► System Design Implications

Firms must architect their platforms for data residency flexibility, often relying on regional cloud providers or building local data centers. This adds both cost and technical complexity.

► Compliance Risk

Non-compliance isn’t just about fines, but also regulators can deny market access entirely. For fintechs, this makes data localization a market entry barrier, not just a fintech app compliance checklist formality.

How To Build A Compliant Fintech App? 

The above-mentioned compliances are significantly important for the success and scalability of any fintech app in the evolving marketplace. 

But these compliances are not meant to be a task after the completion of your fintech mobile app development process. These compliances must be planned from day one and implemented in a step-by-step manner to build a secure and compliant Fintech app. 

Step 1: Define Your Regulatory Scope 

Start by defining your regulatory scope, i.e., check for applicable norms for payments, brokerage, lending, robo-advisory, wallets, or other fintech segments. 

Also, list out the markets you are targeting and the regulators controlling the marketplace. Identify licenses or registrations needed to launch your fintech app. 

Step 2: Do a Data Inventory and DPIA/PIA

Run a Data Protection Impact Assessment and identify lawful bases for processing. Catalog every data element you collect: PII, KYC docs, financial data, device IDs, telemetry. 

Such can help you plan for better data management and user protection when they are using your platform. 

Step 3: Embed Privacy and Security In Your App Design 

When you plan to build a compliant fintech app, ensure that users’ privacy and security protocols have been implemented. Focus on collecting only the data essential for your app operations. 

Adopt relevant encryptions and build consent and preference management into the fintech mobile app design. 

Step 4: Implement KYC, AML, and Fraud Controls 

To create a compliant fintech app, choose reliable KYC providers, invest in a credible background verification system, to add ongoing sanctions and PEP screening. Along with all, monitor transactions for anomalies and set risk-based thresholds and escalation playbooks. 

Focus on relevant API integrations that can perform KYC, as well as indicate in case of any fraudulent activities. 

Step 5: Pick the Right Controls Framework

Align your fintech app with a single controls framework like ISO 27001 or SOC 2 to avoid duplicate efforts. From there, add specific layers such as PCI DSS for card data, PSD2 for open banking, and local data protection laws to cover regional compliance needs.

Step 6: Build Operational Governance

When planning to make a compliant fintech app, define RACI and appoint a compliance and security owner. Also, write down the policies that people are expected to follow. 

Such can include defining how to opt for a change, vendor risk management, SDLC logging, data backups, and more. 

Step 7: Test and Monitor Results Continuously

Conduct security and compliance testing, both pre-and post-launch. Measure MTTD/MTTR and maintain an audit template that can guide and validate each test result. 

Such mobile app testing is significantly important to ensure that every API and compliance integration done to your fintech app is performing well and as per the regulatory standards. 

Step 8: Vendor and Partner Risk Management 

Perform due diligence on every service provider. Such can include attestations, locations, sub-processors, breach history, and SLAs.

Also, plan contracts for data-processing terms, breach notification windows, and the right to audit.

Common Fintech App Compliance Challenges

Building a fintech platform in the current market scenario can bring great entrepreneurial opportunities. But even the most innovative and thoroughly planned fintech apps face challenges in fintech app compliance.

The regulations in the fintech sector are complex, constantly evolving, and vary widely across regions. 

Here are some of the most common fintech app compliance challenges: 

A] Fragmented Regulations Across Markets

Scaling fintech globally means juggling between fintech app regulatory compliance, as they differ between nations. What works smoothly in the US under SEC or CFPB oversight may not meet EU standards under PSD2 or GDPR.

Solution: Build a regulatory map for each market, work with local legal partners, and keep your regulatory compliance constantly updated as per changing regulations. 

B] Data Privacy and Protection

Fintech apps handle highly sensitive personal and financial data. In such a scenario, meeting strict requirements like GDPR, CCPA, or the targeted nation’s data protection law is both resource-heavy and technically demanding.

Solution: Collect the data only what’s essential, encrypt everything, and give users clear control over their data.

C] KYC and AML Compliance

Onboarding users quickly while meeting Know Your Customer (KYC) and Anti-Money Laundering (AML) obligations is tricky. Slow checks frustrate users, but weak checks expose firms to fraud and fines.

Solution: Rely on trusted KYC tools integration, balance speed with accuracy, and set up alerts for suspicious activity.

D] Evolving Fraud and Cyber Threats

Fintechs are prime targets for fraudsters and cybercrime. Keeping up with phishing, account takeovers, and money laundering schemes requires constant monitoring and advanced detection systems.

Solution: Ensure multifactor authentication in your fintech app, monitor activity in real time, and test systems often.

E] Cost of Compliance

Implementing robust compliance programs when you plan to build a compliant fintech app turns out to be expensive for startups and fintech apps with a limited number of users. Also, hiring legal experts, investing in security tools, and running audits stretch early-stage budgets.

Solution: Plan early, assign a compliance lead, and use third-party platforms to reduce overhead. Start with the basics and then shift to expensive upgrades in tools and human resources. 

F] Third-Party Risk

Fintech apps often rely on partners and third-party APIs such as payment gateways, cloud providers, or KYC vendors. If these partners fail compliance checks, liability still falls on the fintech.

Solution: Check for their certifications, sign strict data agreements, and monitor the performance of these third-party platforms before integrating them into your app.

G] Record Keeping and Audits 

The fintech apps are required to maintain records, such as log changes, access, test, and incident. These are to be submitted to the regulators to prove your fintech app is secure and compliant. However, keeping such records eats up storage, and their encryption is a key challenge. 

Solution: Invest in highly secured cloud storage, maintain audit logs, and update them regulatory to identify any security gaps or unauthorized access. 

H] Platform Rules

Along with the local regulations and compliance, even the app store has its own rules. When you publish your app on the Play Store or submit your app to the App Store, it needs to align with the platform rules; otherwise, it can get delisted or banned. 

Solution: Review their fintech app policies before launch and adjust your app flows and copy.

Future Trends in Fintech Compliance 

Fintech app compliance is not stable, and as technology advances and fintech apps expand, these compliances also evolve to keep up with the pace.

Here are the key trends that are shaping the future of fintech compliance. 

1. Stricter data protection laws

More countries are focusing on data privacy acts similar to GDPR, and the existing ones are strengthening these laws. Such is being done to protect the user’s interest and to overcome the threat to the user’s privacy and data from cyberattackers.

Fintechs will need to manage local storage rules, stronger consent practices, and real-time breach reporting.

2. Real-time monitoring and AI tools

AI in fintech is expected to take center stage, and even the regulators are encouraging firms to use AI for fraud detection, transaction screening, and suspicious activity alerts. 

The fintech compliance strategies are shifting from after-the-fact checks to live monitoring, powered by AI tools and other relevant technologies. Hence, you should connect with an experienced AI app development company.

3. Global push for open banking

Another trend to be focused on when planning a fintech app compliance checklist is open or cross-border banking. These approaches assist in the scalability and growth of the fintech platform. 

Also, open banking standards like PSD2 in Europe are inspiring similar models worldwide. Fintechs will have to adopt secure APIs and meet stronger authentication demands.

4. Focus on crypto and digital assets

Fintech users are effortlessly shifting toward and adopting crypto and other digital assets as their regular payment modes and approaches. Hence, following such a trend, the fintech apps are also required to focus on this direction. 

Along with such, the governments are setting clearer rules for crypto exchange trends, stablecoins, and tokenized assets. Fintechs touching digital currencies will face tighter licensing and reporting requirements.

5. Emphasis on ESG and ethical finance

ESG is becoming a focus area in the fintech space, and some regulators are starting to look at environmental, social, and governance (ESG) factors in compliance. 

Fintechs may need to show fair lending practices and transparent sustainability reporting.

How JPLoft Can Help With a Secure and Compliant Fintech App?

The growth and scalability of a fintech platform rely on the user’s trust, and the app security and compliances defines and shape such trust. Hence, it is important to partner with an expert who better understands both the development and regulatory requirements of a Fintech app. 

Hence, all such needs and expectations of yours are fulfilled at JPLoft, the best fintech app development company. We help you plan, build, and launch with security from day one, along with setting up strong encryption for data in transit and at rest. 

We also integrate multi-factor login and session controls to stop account takeovers. We follow least privilege, so only the right people and services can access data.

With us, you can ensure that your system is designed to meet rules like PCI DSS for payments, GDPR for privacy, and local banking laws. We document controls, map data flows, and keep audit logs so you can pass reviews with ease.

Partnering with JPLoft can help you get clear reports, secure APIs, and a build plan that fits your team. With JPLoft, your app stays safe, compliant, and ready to earn user trust.

Conclusion 

Building a fintech app in 2025 means following the fintech app compliance checklist at the core. Users trust you with their money and data, and regulators expect strict checks on privacy, payments, licensing, and security. 

A clear fintech app compliance checklist helps you meet these requirements and avoid costly mistakes. Yes, compliance can feel complex, but when planned early, it becomes a growth enabler, not a hurdle. 

At JPLoft, we design fintech apps that meet global standards, protect users, and pass audits with ease. Start secure, stay compliant, and scale with confidence.