Cost Analysis
Cost Breakdown and Budget Estimates
Architecture alignment note (2026-02-14): This document is pre-architecture research from the mobilebank-research phase. Drop ultimately chose a PSD2 pass-through model — no wallet, no balance held, no own EMI license required for MVP. The pass-through model significantly reduces licensing and BaaS costs compared to the scenarios below. Card issuing is a FUTURE feature. This document is retained as cost research reference — actual Drop cost structure differs.
Table of Contents
- Executive Summary
- Licensing Costs
- Development Costs
- Third-Party Provider Costs
- Infrastructure Costs
- Operational Costs
- Budget Scenarios
1. Executive Summary
Total Investment Range
| Approach |
Initial (Year 1) |
Monthly Ops |
Break-even |
| BaaS MVP |
EUR 150K-300K |
EUR 15-30K |
18-24 months |
| Full Build |
EUR 500K-1.5M |
EUR 50-100K |
24-36 months |
| Enterprise |
EUR 1.5M+ |
EUR 100K+ |
36+ months |
Key Cost Drivers
- Licensing strategy (own vs. BaaS)
- Development approach (in-house vs. outsource)
- Feature complexity
- Geographic scope
- Transaction volume
2. Licensing Costs
Option A: Own EMI License
| Jurisdiction |
Application |
Capital |
Setup (Legal/Consulting) |
Timeline |
| Lithuania |
EUR 1,463 |
EUR 350,000 |
EUR 30-50K |
6-9 months |
| Malta |
EUR 2-5K |
EUR 350,000 |
EUR 40-60K |
6 months |
| Ireland |
EUR 4K |
EUR 350,000 |
EUR 200-300K |
12-18 months |
| UK (FCA) |
GBP 5,000 |
GBP 350,000 |
GBP 100-200K |
6-12 months |
Lithuania Breakdown:
- Application fee: EUR 1,463
- Capital requirement: EUR 350,000 (held in local bank)
- Legal/consulting: EUR 30,000-50,000
- Directors/compliance staff: EUR 100,000+/year
- Total setup: ~EUR 400,000-500,000
Option B: BaaS Partnership (No Own License)
| Provider |
Setup Fee |
Monthly Minimum |
Per-Transaction |
| Swan |
EUR 0-10K |
EUR 500-2K |
Volume-based |
| Treezor |
EUR 10-50K |
EUR 2-5K |
Volume-based |
| Solarisbank |
EUR 50-100K |
EUR 5-10K |
Custom |
Savings with BaaS:
- No EUR 350K capital lock-up
- No license application process
- Faster time to market (weeks vs. months)
- Compliance handled by provider
3. Development Costs
MVP Development (4-6 months)
| Component |
In-House (Western EU) |
Outsource (Eastern EU) |
Outsource (Asia) |
| Backend |
EUR 80-120K |
EUR 40-60K |
EUR 25-40K |
| Mobile (Flutter) |
EUR 60-100K |
EUR 30-50K |
EUR 20-35K |
| Frontend (Web) |
EUR 30-50K |
EUR 15-25K |
EUR 10-18K |
| DevOps/Infra |
EUR 20-40K |
EUR 10-20K |
EUR 8-15K |
| QA/Testing |
EUR 20-30K |
EUR 10-15K |
EUR 6-10K |
| Total |
EUR 210-340K |
EUR 105-170K |
EUR 69-118K |
Feature-Level Costs
| Feature |
Development Cost |
Notes |
| User onboarding |
EUR 8-15K |
Auth, registration |
| KYC integration |
EUR 15-30K |
Third-party API |
| Account management |
EUR 20-35K |
Core functionality |
| Virtual card |
EUR 25-40K |
Issuing integration |
| P2P transfers |
EUR 15-25K |
Internal + SEPA |
| Card top-up |
EUR 10-20K |
Payment gateway |
| Push notifications |
EUR 5-10K |
FCM/APNS |
| Transaction history |
EUR 8-12K |
UI + backend |
| Card controls |
EUR 10-15K |
Freeze, limits |
Team Composition (MVP)
| Role |
Count |
Monthly Cost (EU) |
| Tech Lead |
1 |
EUR 8-12K |
| Backend Dev (Senior) |
2 |
EUR 12-18K |
| Mobile Dev (Senior) |
2 |
EUR 12-18K |
| DevOps |
1 |
EUR 6-9K |
| QA |
1 |
EUR 4-6K |
| Product Manager |
1 |
EUR 6-10K |
| Designer |
0.5 |
EUR 3-5K |
| Total |
8.5 |
EUR 51-78K/month |
Outsourcing Savings: 40-60% vs. Western EU rates
4. Third-Party Provider Costs
BaaS Provider Costs
| Provider |
Setup |
Monthly |
Per Account |
Notes |
| Swan |
Free-10K |
EUR 500-2K |
EUR 0.50-2 |
Fast integration |
| Treezor |
EUR 10-30K |
EUR 2-5K |
Included |
SEPA optimized |
| Solarisbank |
EUR 50-100K |
EUR 5-10K |
Custom |
Full stack |
Card Issuing Costs
| Provider |
Setup |
Per Card |
Transaction Fee |
| Marqeta |
EUR 5-50K |
EUR 0.50-2 |
0.5-1% |
| Stripe Issuing |
Free |
EUR 0.10-0.50 |
Included |
| Adyen |
Custom |
Custom |
Custom |
KYC/Identity Verification
| Provider |
Per Verification |
Volume Discount |
| Sumsub |
EUR 0.50-2.00 |
Yes (>10K/month) |
| Onfido |
EUR 1.00-3.00 |
Yes |
| IDnow |
EUR 2.00-5.00 |
Yes |
Example (10K users/month):
- Sumsub: EUR 5,000-20,000/month
- Volume pricing reduces to EUR 0.30-0.50/verification
Payment Processing
| Provider |
Setup |
Per Transaction |
Notes |
| Stripe |
Free |
1.4% + EUR 0.25 (EU) |
Easy integration |
| Adyen |
Free |
EUR 0.10-0.15 + interchange |
Enterprise |
Virtual IBAN
| Provider |
Per IBAN |
Monthly Maintenance |
| OpenPayd |
EUR 1-5 |
EUR 0-1 |
| Banking Circle |
Custom |
Volume-based |
| Usually included in BaaS |
- |
- |
5. Infrastructure Costs
Cloud Infrastructure (AWS/GCP)
| Component |
Monthly Cost |
Notes |
| Compute (K8s cluster) |
EUR 1,500-3,000 |
3-5 nodes |
| Database (RDS/Cloud SQL) |
EUR 500-1,500 |
Multi-AZ |
| Redis (ElastiCache) |
EUR 200-500 |
Cluster mode |
| Storage (S3) |
EUR 100-300 |
Documents, backups |
| CDN (CloudFlare) |
EUR 200-500 |
Pro/Business |
| Monitoring (Datadog) |
EUR 300-800 |
APM included |
| Total |
EUR 2,800-6,600 |
Scales with users |
Cost Per User
| Users |
Infrastructure |
Third-Party |
Total/User |
| 1,000 |
EUR 3/user |
EUR 5/user |
EUR 8/user |
| 10,000 |
EUR 1/user |
EUR 3/user |
EUR 4/user |
| 100,000 |
EUR 0.50/user |
EUR 2/user |
EUR 2.50/user |
6. Operational Costs
Monthly Operational Expenses
| Category |
MVP Phase |
Growth Phase |
Scale Phase |
| Team (salaries) |
EUR 30-50K |
EUR 80-150K |
EUR 200K+ |
| Infrastructure |
EUR 3-5K |
EUR 10-20K |
EUR 50K+ |
| Third-party services |
EUR 5-10K |
EUR 20-50K |
EUR 100K+ |
| Compliance |
EUR 5-10K |
EUR 15-30K |
EUR 50K+ |
| Customer support |
EUR 2-5K |
EUR 10-20K |
EUR 30K+ |
| Marketing |
EUR 5-15K |
EUR 30-100K |
EUR 200K+ |
| Legal/Professional |
EUR 2-5K |
EUR 5-15K |
EUR 20K+ |
| Office/Admin |
EUR 2-5K |
EUR 5-10K |
EUR 15K+ |
| Total |
EUR 54-105K |
EUR 175-395K |
EUR 665K+ |
Per-User Economics
| Metric |
Amount |
Notes |
| Customer Acquisition Cost |
EUR 20-50 |
Marketing + onboarding |
| First-year serving cost |
EUR 175 |
Fixed costs |
| Monthly serving cost |
EUR 5 |
Infrastructure + support |
| Required spend for breakeven |
EUR 750/month |
Year 1 |
Compliance Costs
| Item |
Annual Cost |
| Compliance Officer (FTE) |
EUR 80-120K |
| AML monitoring tools |
EUR 20-50K |
| External audits |
EUR 30-60K |
| Regulatory reporting |
EUR 10-20K |
| Training & certification |
EUR 5-10K |
| Total |
EUR 145-260K |
7. Budget Scenarios
Scenario A: Lean BaaS MVP
Assumptions:
- BaaS partnership (Swan)
- Outsourced development (Eastern EU)
- 6-month timeline
- Target: 5,000 users Year 1
| Category |
Year 1 |
Monthly (Avg) |
| Development |
EUR 150,000 |
- |
| BaaS setup + fees |
EUR 20,000 |
EUR 2,000 |
| KYC (5K verifications) |
EUR 10,000 |
EUR 1,000 |
| Infrastructure |
EUR 36,000 |
EUR 3,000 |
| Operations (lean) |
EUR 120,000 |
EUR 10,000 |
| Marketing |
EUR 60,000 |
EUR 5,000 |
| Legal/Compliance |
EUR 30,000 |
EUR 2,500 |
| Buffer (15%) |
EUR 64,000 |
- |
| Total Year 1 |
EUR 490,000 |
EUR 23,500 |
Scenario B: Standard Build
Assumptions:
- Own EMI license (Lithuania)
- Mixed team (in-house + outsource)
- 12-month timeline
- Target: 20,000 users Year 1
| Category |
Year 1 |
Monthly (Avg) |
| EMI License |
EUR 450,000 |
- |
| Development |
EUR 300,000 |
- |
| Card program |
EUR 50,000 |
EUR 5,000 |
| KYC (20K verifications) |
EUR 30,000 |
EUR 3,000 |
| Infrastructure |
EUR 72,000 |
EUR 6,000 |
| Operations |
EUR 480,000 |
EUR 40,000 |
| Marketing |
EUR 200,000 |
EUR 17,000 |
| Legal/Compliance |
EUR 150,000 |
EUR 12,500 |
| Buffer (20%) |
EUR 346,000 |
- |
| Total Year 1 |
EUR 2,078,000 |
EUR 83,500 |
Scenario C: Enterprise Launch
Assumptions:
- Own license (Ireland for prestige)
- Full in-house team
- Custom core banking
- Target: 100,000 users Year 1
| Category |
Year 1 |
| EMI License (Ireland) |
EUR 800,000 |
| Development |
EUR 800,000 |
| Core banking platform |
EUR 300,000 |
| Card program |
EUR 150,000 |
| KYC (100K verifications) |
EUR 100,000 |
| Infrastructure |
EUR 300,000 |
| Operations |
EUR 1,500,000 |
| Marketing |
EUR 1,000,000 |
| Legal/Compliance |
EUR 400,000 |
| Buffer (25%) |
EUR 1,337,500 |
| Total Year 1 |
EUR 6,687,500 |
Cost Optimization Strategies
Development
- Outsource to Eastern EU (40-60% savings)
- Use BaaS to reduce custom development
- Cross-platform mobile (Flutter) vs. native
Licensing
- Start with BaaS, migrate to own license later
- Lithuania over Ireland (70% cheaper)
- Small EMI if eligible
Operations
- AI chatbots reduce support costs 60%
- Automated KYC reduces manual review
- Cloud-native for elastic scaling
Marketing
- Referral programs (lower CAC)
- Partnership distribution
- Niche targeting
Financial Model Summary
Unit Economics Target
| Metric |
Target |
| CAC |
< EUR 30 |
| LTV |
> EUR 150 |
| LTV:CAC |
> 5:1 |
| Payback period |
< 12 months |
| Gross margin |
> 60% |
Revenue Model
| Stream |
Revenue/User/Year |
| Interchange |
EUR 15-30 |
| FX markup |
EUR 10-20 |
| Premium subscription |
EUR 60-120 |
| Interest income |
EUR 5-15 |
| Total potential |
EUR 90-185 |
Break-even Analysis
| Scenario |
Users Required |
Timeline |
| BaaS MVP |
5,000-10,000 |
18-24 months |
| Standard |
20,000-30,000 |
24-36 months |
| Enterprise |
50,000+ |
36+ months |
Sources