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Open-Source vs. Proprietary CRM Systems: Which one is right for your business?

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During the lifecycle of a fintech it is common for systems and processes to change, revolving the business as it is grows, develops, or adjusts to various circumstances. A business may decide to migrate to a new operating system, customer relationship management (CRM) platform, or design software, depending on the variables surrounding the expansion or future outlook of the company. It is crucial and essential to know what each type of software does, what it can do, and which one is right for one’s business. Choosing between an open-source or proprietary software may be challenging. Still, by examining the benefits and disadvantages of each system, one can uncover which type of software is best for them.

A proprietary software is one that is owned and protected through copyright by an individual or company who has developed it. This software is managed solely by the team or company that owns it and is licensed to other companies that request to use the software. Typically user companies would have to pay a fee to use or license the software to its own internal systems, as well as any commercial support or contracted maintenance work that is needed in the transition, setup, or deployment phases throughout the system’s lifetime. Companies using the software are often given an authenticated license to use the software. However, because the user company does not own the software, the license comes with many rules, restrictions, and stringent regulations surrounding its terms and conditions. A majority of engineering and commercial software applications are proprietary, including softwares such as Microsoft Windows, OS operating systems, Adobe Photoshop, Slack, and Norton Antivirus.

The main characteristics of proprietary software include restrictions on sharing and installing of the software, the subjection of time limits after which the license must be renewed, frequent updates and added features at an extra cost, and the reliance on the proprietary software vendor to continue to add features, debug current issues, and improve the product over time. It can be difficult to migrate and transition from one software to the next, so trusting the vendor of any given software is essential and necessary in order to not slow down the business or cause any unnecessary delays.

Open source software, on the contrary, is a public software available for free use by all working professionals. This software is copyright free, and the source code is publicly available on the internet for programmers to modify and add their own extra features and capabilities to the platform at no additional cost to the user. This allows for improvements to be made by the community and not through a corporation. Individuals using the platform can improve the software and recommend changes to others in the open-source software community or implement the changes themselves at no additional charge to the user. This means that open-source softwares are developed and tested through open collaborations with the public and managed by an open-source community of developers. Users are not required to have a specialized or authenticated license to use open-source software. The most common open-source applications on the market are Linux, Mozilla Firefox, Word Press.

The main characteristics of open-source software include the freedom for individuals to use it for any reason or purpose without limitations, regulations, or restrictions. All open-source developers have complete visibility and access to the source code and are free to modify and improve the program as they wish. Because of this reason, open source software have more features to offer and are more flexible and adaptable to entire global communities rather than solo companies. Anyone can contribute to the source code, which introduces an unlimited scope of options and customizations that can be done with the software for all types of users, businesses, and nieces. Open-source programmers are able to work together efficiently without restrictions to accomplish these tasks. However, this exact advantage can also lead to a flaw in security. If everyone can edit the source code, how secure is the software, especially for an industry such as fintech.

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