SDLC Best Practices for Fintech

What SDLC Means in Practice

The Software Development Life Cycle sounds formal, and in finance it often is. But strip away the acronyms and it is really about one thing: having a reliable, repeatable process for getting code from an idea to production without breaking things along the way.

In unregulated startups, "move fast and break things" might be acceptable. In finance, "break things" can mean trading losses, regulatory fines, or client impact. The SDLC practices below exist because the cost of getting things wrong is high.

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Code Review: The Most Valuable Practice

If you adopt only one practice from this list, make it code review. Every change to production code should be reviewed by at least one other developer before merging.

What Good Code Review Looks Like

• The author explains what the change does and why, not just how
• The reviewer checks for correctness, edge cases, readability, and test coverage
• Comments are constructive, specific, and focused on the code (not the person)
• Small PRs — if a pull request is more than 400 lines, it is too big. Break it up.

What to Look For

✓ Does it handle edge cases? (empty lists, zero values, None)
✓ Are error messages helpful for debugging?
✓ Is the test coverage adequate?
✓ Are there any security concerns?
✓ Will this be understandable to someone reading it in 6 months?
✓ Does it follow the team's coding standards?

The value of code review extends beyond catching bugs. It spreads knowledge across the team, maintains consistency, creates documentation of decisions, and mentors junior developers. In regulated environments, it also provides an audit trail of who approved each change.

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Environment Strategy

Production code should never be the first place a change runs. A typical environment ladder:

Each environment should mirror production as closely as possible. Docker containers make this dramatically easier — the same container that passes tests in CI runs identically in staging and production.

Configuration that changes between environments (database URLs, API keys, feature flags) should come from environment variables, not from code changes. This ensures the same code artifact is tested and deployed.

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Branching Strategy

How you use Git branches directly affects team productivity and release quality.

Trunk-Based Development — the simplest model. Everyone works on short-lived feature branches (lasting hours or a few days) and merges frequently to main. Works well with strong CI/CD pipelines and automated tests.

Git Flow — a more structured model with main, develop, release, feature, and hotfix branches. More complex but provides clear release management. Common in teams with scheduled releases.

GitHub Flow — a middle ground. Work on feature branches, open pull requests against main, merge after review. Deploy from main. Simple and effective for most teams.

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Release Management

How you deploy changes to production matters. Best practices:

Semantic Versioning — version numbers communicate what changed:

• 1.0.0 → 1.0.1: bug fix (patch)
• 1.0.0 → 1.1.0: new feature, backward compatible (minor)
• 1.0.0 → 2.0.0: breaking change (major)

Changelogs — document what changed in each release. Invaluable for debugging and for stakeholders who need to know what is in production.

Feature Flags — deploy code without activating it. Switch features on or off without deploying new code. Roll out gradually to a percentage of users. Instantly disable a problematic feature without a rollback.

# Feature flag in code
if feature_flags.is_enabled("new_risk_model", user=current_user):
    risk = calculate_risk_v2(portfolio)
else:
    risk = calculate_risk_v1(portfolio)

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Documentation

Underdocumented systems become unmaintainable. The key types of documentation for financial systems:

• Architecture Decision Records (ADRs) — why you made specific technical choices
• Runbooks — step-by-step guides for operational procedures (deployment, rollback, incident response)
• API documentation — automatically generated from code where possible
• Onboarding guides — how a new team member gets set up and productive

Documentation does not have to be perfect. It has to exist, be findable, and be roughly current.

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Incident Management

When things go wrong (and they will), having a clear process matters:

1. Detect — monitoring and alerts catch the problem
2. Acknowledge — someone takes ownership
3. Communicate — stakeholders are informed
4. Mitigate — stop the bleeding (roll back, disable feature, switch to backup)
5. Resolve — fix the root cause
6. Post-mortem — blameless analysis of what happened and how to prevent it

Post-mortems are critical. The goal is not to assign blame but to improve the system. Every incident is a learning opportunity.

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Starting Small

You do not need all of these practices from day one. Start with:

1. Code review on every change
2. Automated tests in CI
3. At least two environments (dev and production)
4. A documented deployment process

Then iterate. Add staging environments, feature flags, release processes, and monitoring as the team and system grow. The practices compound — each one makes the others more effective.