By Nathan Kerr, CTO and Executive Director at One Click Group Limited
There really is no sexy answer to this.
The best way to protect user data is surprisingly simple: don’t collect what you don’t need. We often chase after elaborate cybersecurity solutions when, in reality, the safest data is the data that doesn’t exist in the first place. Just like the age old saying goes; prevention is better than cure, and in the world of data protection, “holding less” is the best prevention strategy.
As fintech companies continue to innovate in 2025, this principle of minimalist data design needs to be at the forefront of how we think about security. By just collecting and storing what’s absolutely necessary, companies reduce their attack surface, cut costs, and stay ahead of the ever-changing regulations.
After all, you can’t lose what you never had, right?
The Case for Minimalist Data Design
By embracing minimalist data design, fintech companies can reduce the temptation and make themselves far less appealing targets for hackers. If your platform doesn’t store mountains of sensitive user data, there’s much less to worry about locking down.
Why rely on endlessly complex security systems and catchphrases like zero-trust, encryption, public-private keys, blockchain—blah, blah, blah—when you can instead focus on lean data collection? Prioritise what’s essential for functionality and compliance, and cut the rest.
Beyond security, minimalist data practices make financial sense. Storing less data keeps you ahead of regulations and simplifies compliance. And as a bonus—it’s cheaper! Many of my meetings end up reviewing the cost of data storage, especially since legislative requirements in Australia sometimes mandate records be kept for several years. “Clouds” aren’t free, so the less we have to store, the better.
And, less data, means less risk, and that means more trust.
Compliance Regulations and Lean Data
Regulatory compliance is a constant focus for fintech companies, as privacy laws like the GDPR in Europe, and Australia’s Privacy Act emphasise data minimisation, transparency, and user consent. When adopting lean data practices, fintech companies don’t just reduce risk—they make regulatory compliance a simpler process.
Ultimately, the companies that have prioritised restraint are inherently in a better position when regulators scrutinise data collection policies. Adopting platforms that only collects the data absolutely needs demonstrates clear intentions and negates the pitfalls of over-collection. It isn’t just about compliance—it’s about aligning with the values that regulators and consumers are beginning to demand.
When you consider how much non-compliance can cost a company: not only in financial penalties but reputational damage, it’s a no-brainer. Prioritising compliance with privacy laws is both a legal obligation and a strategic necessity.
Trust Through Transparency
Over and above security, data protection is about trust. Consumers need to know that their personal and financial information is being handled properly and in safe hands. Minimalist data practices reinforce trust, showing users that a platform values privacy and isn’t hoarding their data just because they can.
And building that trust requires clear and honest communication. Companies should explain exactly what data they collect, why they collect it, and how they use it.
They should also empower users to control their data by providing tools for managing preferences, viewing what’s collected, and even deleting accounts. Allowing users to manage their data preferences, and make informed choices about data sharing is a win.
When users see restraint in action, they trust that a company is prioritising their privacy over their own bottom line.
The Role of Technology
Minimalist data design doesn’t mean abandoning backend technology. Fintech companies should still leverage tools like encryption, fraud detection algorithms, and blockchain for secure transactions. These solutions remain critical, but they should support – not substitute – the core strategy of holding less data.
For example:
- Encryption ensures that the data you must retain is safeguarded.
- AI-driven fraud detection can identify threats without requiring large amounts of stored user data.
- Blockchain provides transparency for transaction records, reducing the need to store sensitive information in centralised databases.
The most successful companies will integrate these tools into a minimalist framework, enhancing security while maintaining the principle of “less is more.”
Financial and Operational Advantages
Every byte of data stored comes with a cost. Servers, cloud infrastructure, and compliance measures all add up, and as data volumes grow, so do the expenses.
In fintech, where regulatory requirements often demand that records be retained for years, the costs can quickly become significant. By adopting lean data practices, companies save money on storage, infrastructure, and compliance audits. And those savings can be reinvested into areas like innovation and customer experience.
Looking Ahead: The Minimalist Mandate
As fintech continues to expand in 2025 and beyond, the companies that succeed will be those that prioritise responsibility over quantity when it comes to data. Holding less is not just a security strategy—it’s a way to build trust, cut costs, and stay agile in an increasingly complex regulatory environment.
The fintech industry is one of the fastest growing industries, and globally it’s moving fast; reshaping how we handle money and compliance. In the next 12 months, the big opportunities will be in three areas:
- Digital Payments: As many consumers embrace a cashless lifestyle, they are embracing digital wallets and payment gateways, giving fintechs a clear path to expand.
- RegTech: Compliance is a headache, but fintechs offering smarter solutions—like tools to navigate PSD2 in Europe, U.S. consumer protection laws, or Australia’s evolving privacy and data retention requirements—will be in high demand.
- Blockchain: No longer niche, it’s decentralised and secure. It will gain traction with businesses and regulators in the tech-savvy markets.
The future isn’t just about innovation—it’s about leading responsibly while adapting to what users and regulators expect.
The industry doesn’t need more buzzwords or complex systems to protect user data. It needs clarity, restraint, and a commitment to the principle that if it’s not there, there’s no risk. Fintech’s future will be defined not by how much data we can gather but by how much we’re willing to let go.
Less data, less risk, more trust. It may not be sexy, but it’s smart, and it’s how we should lead the way.
As published on FintechBloom:
How Fintech Companies Can Lead The Charge In Data Protection In 2025 | Fintech Bloom