How to Create a Mobile Banking App: Step-by-Step Guide
We live in an ever-changing world of technologies, open boundaries, and possibilities. No wonder that the rapidly evolving banking landscape adopts mobile applications. They become essential tools to drive operational efficiency and meet the client’s demands. Modern consumers expect real-time access to make payments, manage their finances, and get notifications. They want instant services and more personalized and efficient experiences.
Brief Overview of the Importance of Banking Apps in Modern Finance
Banks are progressively moving towards mobile banking and mobile-focused solutions. Users admit they use banking apps most often among various financial applications. The figures are impressive. Almost 100% of Generation Z and Millennials utilize mobile banking for multifaceted purposes. They check balances, monitor their credit score, and deposit checks. Gen X (86.5%) and Boomers (69.5%) show less activity, yet these groups are still in the majority.
More than that, by 2030, the revenue across the market of mobile banking is projected to reach $1.87 billion. It’s going to grow at a CAGR of 11.7%. There is a revenue to get from banks and financial institutions in this sphere that is stupid to lose.
Today, we focus on creating a banking application and how both consumers and financial institutions can benefit from its transformative power. Let’s proceed to the details.
Growing trend of digital banking and its benefits
Banking needs strategic foresight and innovative software solutions to thrive in the modern digital age. The trend for mobile banking redefines the financial industry. It embraces tech innovations and addresses operational efficiency intricacies. At the same time, it enhances the transparency and security of consumers, allowing seamless access to their funds and banking services and convenient, streamlined, and secure financial operations right from their smartphones anytime, 24/7, and from anywhere.
Why build a mobile banking app?
To be more precise, I want to enumerate the benefits of developing mobile banking solutions. Let’s consider them from the users’ and banks' perspectives.
Advantages for users comprise:
- Convenience: fast and secure access to the bank account round the clock,
- Better control over finances,
- Instant money transfer and transactions,
- Extensive functionality,
- User-friendly UI,
- Expense management and tracking,
- Notification set up,
- Cashback option.
Mobile software brings the following benefits to banking institutions:
- Cost efficiency through lower dependence on physical establishments, personnel, paper-based documents, and operational costs,
- Continuous innovation (technologies, features, and services) and staying in line with the latest market trends,
- Streamlined operations because of automated routine tasks,
- User convenience, higher user satisfaction, and consequently loyalty,
- Broader client outreach because the customer base can be expanded with remote users, while products and services can be offered directly in the application,
- Informed strategy formation due to accessibility of data and real-time insights into user info and transaction details,
- Integration possibilities with various payment channels and financial platforms,
- Robust security through encryption implementation, multi-layered verification, and anti-fraud measures.
So, you have no doubts anymore that the importance of banking apps is growing. Whether you are an established banking service provider or just entering the market, you need to figure out how to create a mobile banking application to meet your client’s needs to stay competitive in this dynamic and evolving industry. We’ll discuss the different types of mobile solutions for the banking sphere to give you more insights into the possibilities.
Types of Mobile Banking Apps
As of today, mobile banking solutions are comprised of not only apps as they are but also some other versions. We describe the main ones below.
SMS
SMS banking is realized via text messages, which is a sign-up option. Users can then enquire about account balances, review abridged account statements, request current interest and foreign currency exchange rates, transfer limited amounts of money, and block debit or credit cards through specific SMS commands. Each bank has its own list of commands for this purpose.
Since the operations are initiated via SMS, a client does not necessarily need a smartphone or internet connection to use SMS banking.
Mobile Banking via USSD
USSD—Unstructured Supplementary Service Data, or quick codes as they are called, is used by mobile phones for communication. So, USSD banking also does not require an internet connection or a smartphone.
A user can request the menu of banking services with specific shortcut combinations and click on ‘send.’ Then, they can proceed with balance checking, mini-statement requests, etc.
App-based
App-based banking is a service in the form of a mobile app designed by the bank and for the clients of this bank. Through a mobile user interface, customers can log into their profiles, navigate menus, locate bank branches and ATMs, or manage their finances on the go. They can also access customer service via chat or a phone call.
Sometimes, banks offer diverse apps for different services. There are apps for checking account balances, paying bills, transferring funds, etc. A user can download one or several applications according to their needs and purposes.
However, it’s always more convenient to have a solution that serves as a one-stop shop for all user needs. So, let’s find out the core features of a banking app.
The Core Features of Banking Apps
To decide how to create a mobile banking app, you should determine what functions you want to implement. Thetures will prompt you on the tech stack to choose for your solution and consequently the way and methods of development.
Verification and authorization
Banks must use advanced security measures to comply with strict industry regulations. So, multi-factor authentication is a preferred feature for mobile banking applications. Biometric authentication data (fingerprint or face ID) is also often used for account access. Secure authorization and verification functionality should become your first concern during mobile banking software development.
Transaction management
Account and transaction management should include the possibility of checking balances, viewing transaction history, depositing funds, and making payments and money transfers. You can also offer your users the option of scheduling regular payments, managing loans, and even paying bills.
Customer support
Customer support always adds a sense of confidence. It is a crucial factor in everything finance-related. So, when developing a banking app, consider real-time transaction assistance and in-app chat support if a user needs them. It’s also reasonable to integrate communication channels.
More than that, to get a loyal audience, allow your users to customize their profiles and choose preferences. Thus, you can provide more personalized support based on your client’s individual needs.
Geolocation
Geolocation API integration will help your customers locate nearby terminals, ATMs, and bank branches. At the same time, it’s a vital feature to detect fraud or the reason for an alert if the mobile app operates from a suspicious location.
NFC
This relatively new technology allows contactless payments. Most modern customers have already got used to it. Today, we can speak about NFC as a core feature of a banking app.
Internet payments
Many modern banks allow in-app payments through popular payment systems like Stripe, PayPal, etc. To stay current, you should offer these options to your users.
Push notifications
It’s a critical feature for urgent messages and valuable for regular notifications. The app can not be active all the time. Push notifications can inform users of account status changes. For instance, they can ask to authorize a scheduled transaction confirmation to prevent fraud or double payment.
Core functionality is undoubtedly essential for a good user experience, convenience, app reliability, security, and regulatory compliance. However, you should supplement the robust core functionality with nice-to-have advanced features to beat your competitors. They will enhance the service of your platform. Let’s turn our eyes to them.
Advanced Features
Unique value-added functionality can be a decisive factor in determining whether customers try your product and stay with you. So, to retain your clients, consider implementing the following features.
Chatbot and voice assistants
Such functionality contributes to a more user-friendly interface and enhanced user experience. Nowadays, chatbots can handle up to 80% of routine tasks and customer queries in real-time.
On the one hand, chatbots can cope with a large number of queries at a time, offering quick solutions and prompt responses to clients. Voice assistants are good helping hands to users who lack technological proficiency or possibly have specific disabilities. Thus, you can enlarge your user base. On the other hand, such chats and voice assistants save time and human effort for your personnel.
Expense trackers
Lots of people nowadays are trying to master financial awareness and get a comprehensive overview of economic behavior and spending habits. So, by allowing your clients to track and manage their expenses and save more, you’ll attract those who are eager to master financial control and planning. Implement the possibility to categorize transactions, set spending limits, generate reports, and optimize spending; your clients will appreciate this.
Cashback services
Cashbacks create loyalty and engagement. Implementing it will turn your banking app into a rewarding monetary tool. In such a way, you can encourage customers to use your mobile application consistently. It will also enhance the attractiveness and overall value of the mobile banking experience.
Personalized offers
Personalized offers to customers can become a win-win scenario. So, consider targeted discount generation, exclusive deals offering, cashback rewards, and other attractive options that cover the interests of your app users. You'll need to implement ML and AI-powered algorithms to gather user data and understand critical spending patterns or preferences.
Fraud alerts
Fraud alerts are something extremely important nowadays. Consider push notifications to enhance security. Make sure your clients are notified of potential fraud or suspective activity as quickly as possible.
Bill-splitting
This feature is helpful in modern social settings when a person needs to divide expenses with friends, colleagues, or family. Splitting bills promotes an easy settlement of shared bills. It lets one view the parties’ contributions, send reminders, and settle debts in the app.
Integration with wearables
In the era of wearables, you can not miss the chance to allow your clients to access the necessary info effortlessly and instantaneously on their wearable devices. Moreover, processing transactions right from the wearable and payments through NFC technology will become your competitive advantage.
Cash Withdrawal without a bank card
A good idea is to allow your banking software users to withdraw funds from ATMs through the app confirmation. It will prevent them from carrying an ATM card with them all the time.
Crypto Wallets
Crypto is a modern trend, and the future is already here. If your clients show interest in crypto assets, it’s wise to partner with at least significant exchanges of Bitcoin, Ethereum, etc.
Why Building a Banking App May Be Tough?
When questioning how to create a bank application, you should also consider what challenges may await you. We will address these and show you how to handle the difficulties.
Regulatory requirements, security, and customer data privacy should be your first and foremost concerns. Banking software has to comply with a large number of regulations. Financial severe penalties threaten those who fail to implement these. So, you should partner with security-minded software vendors who know the rules.
Your constant focus should also be on an intuitive, user-friendly interface with seamless onboarding. A banking app is used by various users, but not all of them are tech-savvy. It may become a challenge not to overload the interface with unnecessary elements and make it intuitive. However, UI/UX designers with relative expertise and experience will prompt you with the correct answers.
Anti-money laundering (AML) and know-your-customer (KYC) tools are a must. You have to implement them; otherwise, you may face financial penalties. To exclude this, choose a team of developers who know how to build a mobile banking app with a reliable user authentication and authorization system.
The ability to block payments should be instantaneous. Make sure the users can connect to their accounting system and block the bank card immediately in case of suspicious circumstances.
6 Steps to Building a Mobile Banking App
At Stfalcon, we already know how to create a bank application. Although our team follows more or less standard software development procedures, banking software may be different.
Research
The research is realized at the discovery phase, devoted to careful investigations of the market, leaders and outsiders, available products, user needs, pain points, and unsatisfied expectations.
Having gained a comprehensive understanding of the market and target audience, you can compile a list of specifications for your future banking app. At Stfalcon, we do it all for our clients and provide them with the results and proposals. Trust the discovery of our company, and we’ll tell you how to make a mobile banking app most effectively.
Build and verify a prototype.
A complex banking app mechanism contains multiple features, making it rather difficult to develop from scratch. So, we advise you to create a prototype. Prototypes help visualize the interface and functionality of the app-to-be and establish effective communication between the development team and the stakeholders.
What’s more, by testing a prototype, the developers can test the idea with a target audience. They can validate tech feasibility, evaluate performance, and spot bottlenecks if there are any. The latter can be addressed at an early stage. A prototype is flexible and relatively cheap because it requires 10x fewer resources.
So, you can modify it and remove bugs right away without much expense. After approving a prototype, you can develop a solution with a proven product-market fit.
Lay the groundwork for security.
You should ensure that your banking app meets all security standards, regulations, and data protection laws at this stage. The minimum regulatory requirements list includes GDPR, PSD2, PCI DSS, and CCPA. However, each country has its regulations, so be sure to check all the legal nuances.
Design the UI/UX
Before you take up the UI\UX design of your banking application, business logic and functionality should be implemented in full. We advise to follow a holistic approach to UI/UX:
- Choose clear menus.
- Feature simplified navigation.
- Make sure your clients can access all the essential services.
- Keep in mind that web accessibility is legislatively regulated in some countries. For more information, see the Web Content Accessibility Guidelines (WCAG) 2.2.
Develop the app
As soon as your prototype is developed and tested, your UI/UX is well-defined, and the next stage comes. It’s the stage of translating the conceptualized design and charted requirements into a mobile app. The development starts with building the server-side logic, implementing business rules, and integrating the APIs, which enable the app’s functionality.
The developers then deal with UI/UX to ensure a seamless user experience. Testing, security vulnerability improvements, and handling of all usability issues also belong to this stage. Keep in contact with the development team to ensure the software meets your expectations.
Release and maintain
When testing is completed and the majority of issues are handled, the application is launched. It’s often uploaded to Google Play and AppStore. Here, the next stage begins. On the one hand, you should remember to pay for technical aspects such as server capacity, integration with payment gateways, support for some technologies, etc.
On the other hand, the growing number of users will detect new issues and set new requirements. Be ready for that. Regular updates and innovations will always keep your application competitive. We know that the question of costs is the critical question you are impatient to ask. Just keep reading, and we’ll answer it below.
How Much Does it Cost to Make a Mobile Banking App?
The budget for a software solution is always subject to many aspects. These include the hierarchy of the workflows and their complexity, the tech stack, and third-party integrations. The more logical blocks an app contains, the more complex the task is, and the more specialists may be required. When developing for Android, you should keep in mind how to make a mobile banking app that operates on variable devices.
The form of interaction with the developers and the chosen price format also matter. If you hire a dedicated development team for a relatively simple solution, you can start from around $100000. However, the more realistic budget for a competitive product is $500000. The sky is the limit for the development of a complex banking app.
Another popular question is how long it takes to build a banking app. The first customer-ready MVP can take between 6 and 12 months. Then, there follows about a year of full-fledged product development.
When considering a long-term investment in a banking app, keep in mind the figure of around a million US dollars. In the ever-developing world, ongoing yearly maintenance and updates should be regular to keep the market.
Create a Mobile Banking App with Stfalcon
If you are considering mobile banking app development, Stfalcon is the right partner. Our developers have extensive expertise gained from multifaceted projects for clients worldwide.
Variable software types and solutions developed for diverse industries make us a trustworthy vendor for any project. Speaking about the banking sphere, we carried out a project for the most significant French bank.
Conclusion
If you are already excited about the idea but still unsure about how to build a banking app, contact a Stfalcon expert. Together, you can discuss the concept and the possibilities in detail. Later on, our company can turn it into a top-level experience for your users. Nowadays, banking applications bridge the gap between ordinary banking practices and user expectations of contemporaneity. So, if you are ready to become a game changer and drive innovations today, let’s discuss it.
There are some popular questions we get as to banking app development. Keep reading to find the answers.
FAQs about creating a banking application
What are the requirements for a banking app?
Check the Web Content Accessibility Guidelines (WCAG) 2.2. In addition to the common requirement of a user-friendly and intuitive interface, offline functionality, and smooth integrations, banking solutions must meet financial regulations requirements and industry security standards.
How to build a secure banking application?
When you think about how to make a legal and secure banking app, consider the following standards: PCI DSS—Payment Card Industry standards for cardholder data safety worldwide. In the USA, it’s CCPA—the California Consumer Privacy Act. In Europe, make sure your software is GDPR-compliant and check PSD2—the Payment Services Directive.
How long does it take to build a mobile banking app?
As mentioned in the article, a full-fledged banking application development can take up to 2 years. The first year is often devoted to building a properly operating MVP. Your app functionality complexity and specifics determine the term of development and should be estimated in each case separately.
Originally published at https://stfalcon.com.
