Mobile App Development

Mobile Banking App Building: Benefits, Challenges, and More

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Mobile banking app building is an up-and-coming FinTech niche these days. Bloomberg states that 85% of deposits are digitized now at the Bank of America. Accessing banking accounts through mobile gadgets is the primary connectivity method for over 80% of recent research participants.

We’ll go through the basic principles of banking software development, its benefits, significant challenges you may face as well as other necessities.

Banking App Building Benefits

In a nutshell, banking software products are beneficial for customers (offering them quick access to bank account, convenience, and security) and banks (letting them cut costs for additional staff hiring and reduce operational costs). Let’s look at the essential benefits for both sides. 

Reducing expenses. Mobile solutions provide better operational accuracy than humans, even processing loads of data day and night. Thus, you may need fewer staff members (or none of them) to perform activities that the app can accomplish, no need to pay office rent, etc. 

Improved UX. Not every bank may implement banking solutions into their everyday workflow, preferring chatbots, web, or desktop solutions. However, customers highly appreciate mobile applications, as they offer convenience and data security. 

Exceptional Return on Investment (ROI). Mobile banking returns investments in various ways, including increased transaction frequency and engagement.

A Different Marketing Approach. You can inform customers about new insurance packages or increased credit limits right in your banking solution. Most applications apply to a customized dashboard or push notifications to communicate with users.

Push notifications in Revolut

The Major Banking App Building Challenges

Ensuring data privacy and security in banking apps is a critical development issue. There are regulations in certain countries that control user privacy (such as GDPR in Europe or CCPA in California). 

Security

Cyberattacks cost a pretty penny for all businesses: it is predicted to cause a $6 trillion loss by 2021 year-end and $10.5 trillion a year by 2025. 

That’s why applications from the banking sphere (as one of the most sensitive) should obligatory contain features like end-to-end encryption, multi-factor authentication, secure back-end architecture, etc. How do the companies care about it?

For instance, Revolut (a famous British banking application) uses the Transport Layer Security (TLS) protocol to protect and encrypt their information and save its integrity. Card information is held in Revolut according to PCI DSS regulatory guidelines. Moreover, the app restricts contactless payments to keep consumers secure.

Revolut is a TLS-protected app

Biometric login and two-factor authentication (2FA) are other must-have security features for banking apps. Every financial transaction should be double-confirmed by the user.

Other typical functionality for safe mobile banking include:

  • Security verification (pen tests) 
  • QR codes used to make transactions
  • App architecture with dependable DDoS protection and quick data recovery
  • Encryption/double encryption of information in data transmission channels 

Compliance With Regulations

Before you start developing a banking app, you should check your target country’s regulations and follow them to provide safety and security for your app data and avoid huge fines for non-compliance.

The following are the most well-known financial security regulations:

  • General Data Protection Regulation (GDPR)
  • Payment Card Industry Data Security Standard (PCI DSS)
  • KYC (Know Your Customer)
  • California Consumer Privacy Act (CCPA)

You can also contact a financial adviser to create a mobile-only banking software like Revolut. Such specialists may explain all of the potential problems and offer appropriate solutions.

The Functionality Mobile Banking Apps Should Include

Developing mobile banking app, you should first consult with your target customers to learn about their operational needs and objectives. Then, define basic features you should implement first. Don’t overload your app with a lot of additional functionality at once; keep in mind that it impacts the final cost to develop an app.

Let’s go over the key features that most banking applications have in common:

Account sign-up should be safe but not too time-consuming. Other banking applications require a password or biometric login (e.g., Apple Touch ID or Face ID), whereas the Revolut app requires a 4-digit password. You may also provide your app with 2FA verification to secure the customers.

Entering a password in Revolut

Account management. The more functionality the banking app covers, the more user-friendly it should be. So, UI/UX design is critical at this point. It makes users try out your software or helps you stay competitive.

Money transactions. As the consumers share a lot of personal information, sending or receiving money should be safe and straightforward. That’s why biometric verification or entering a password should be provided for users to protect financial operations. 

Online customer support, targeted push notifications, and bill payment features should also be implemented in your app. 

Additional Banking App Features

The additional functionality includes spending trackers, QR code scanners, money converters, applications for wearables, and so on. 

Spending trackers. Intending to build a banking app, consider integrating budgeting, saving, and expense monitoring tools. For instance, with Revolut, you may create budget limitations to keep track of your spending or determine the daily limit. 

Revolut spending trackers

Scanners for QR codes allow you to make simple and secure transactions. Everything you need to have – a code to read and a scanner integrated into your app.

Money converters. Some banking apps display in-app exchange rates, while others integrate an in-app converter in addition. For instance, Revolut gained popularity by mixing multi-currency purchases and money transfers in one app.

Apps for wearables. Even though smartwatches stay the most popular wearable gadget, not all banks provide wearable app development. It possibly will give you a competitive advantage.

An app sample for smartwatches

How to Develop a Mobile Banking Solution?

If you’ve chosen to cooperate with a software development vendor, your development workflow will go the following way as we described below. 

Planning and Research would be the first stage of the building process. You need to conduct a market analysis studying your competitors, core audience, their expectations from a future product, etc. Such research saves your funds in the future and protects you from any unexpected situations. 

UI/UX design. The majority of app development providers start with low-fidelity wireframes. They demonstrate how users can interact with the software. After gathering your comments or receiving permission, the team creates the app interface screen by screen. Graphics, icons, buttons, and other UI components are added after all.

Choosing tech stack. The technology stack you choose (e.g., libraries, programming languages, or APIs) is determined by factors such as project scope, complexity, and scalability. When it comes to security, app developers choose local languages like Swift for iOS and Kotlin for Android banking apps.

MVP building means creating a solution with basic features (such as transactions, payments, push notifications, etc). It allows you to test your app viability before investing a large sum of money in it. 

Launching and gathering feedback. App stores give special requirements for all apps that will be published there. After the app is launched, you should start collecting feedback, and once you get it, make a list of weak and vital aspects of your app and decide how to upgrade it with your tech vendor.

The Bottom Line

If you want to obtain a secure, regulatory compliant, and easy-to-use mobile banking app, you should think up how to create it or simplify this job, applying it to a qualified software development team. The specialists will provide you with accurate project estimates and a tech stack to use and assist you in building a seamless and competitive solution. 

My name is Katherine Orekhova and I am a technical writer at Cleveroad – mobile app development company. I’m keen on technology and innovations. My passion is to tell people about the latest tech trends in the world of IT.