Secrets to a Successful Mobile Banking App Development in 2023

Today’s mobile banking software solutions offer flexibility and convenience with just a click or tap, regardless of branch hours and location. And with a growing appetite for banking services, traditional institutions have to meet current market trends to retain their existing clients and attract newcomers. 

For example, Ally Bank was one of the first to introduce a virtual assistant. The Bank of Melbourne was the first to create a mobile banking app for Apple Watch. The Liv app launched by Emirates NBD (which is also the UAE’s first digital-only bank) for Millennials allows splitting bills instantly with friends via social media.

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If you’re still in doubt about mobile banking app development, allow us to try and convince you to go for it with our hands-on guide. 

Over the eight years of our history, Relevant got a hang of fintech, to say the least. We are especially proud of FirstHomeCoach for the UK market and Payroll for the US.

So keep reading to find out everything you need to know to develop a mobile banking app in 2023. 

Mobile banking app market overview for 2021-2023

The modern consumer will tend to use mobile bankinseg app features instead of visiting the traditional branch, and there are various reasons for that.

Why mobile applications are gaining importance in the banking sector

Banking app development is on the rise since today’s life pace has made internal banking apps a must-have. All thanks to:

• 24/7 access
• Effortless reviewing of transaction history and details
• Remote deposits 
• Best security practices
• Paying bills in one click
• Transferring money easily
• Paying off loans online

Financial institutions, in turn, get the following perks by adopting mobile banking apps:

• Reduced operating expenses
• Enhanced customer experience
• Good return on investment (ROI)
• Personalized services thanks to data analytics (powered with artificial intelligence)
• Maximal value through push-notifications

It makes a lot of sense for banks to have mobile applications at hand to continue running this race and, what’s more, win it. Following trends is one way to do this.

What are the trends of mobile banking?

We’ve gathered some stats for your inspiration and future focus. 

Mobile banking development trends show frantic ambition, resulting in a steady growth potential and the continued drive for evolution. Statistics claim that 7 billion mobile users are to come by the end of 2021, with 3 billion of them jumping into mobile banking.

The top game-changers in the banking industry include Citibank, Wells Fargo, USAA, Ally Bank, and Capital One. PayPal is the most-used mobile payment app (73%), while Samsung Pay is the least used (6%).

According to the EY, 50% of consumers go digital when applying for financial products. In fact, Statista reveals mobile payment transactions will reach the $189.97 billion mark by the end of the year. And, of course, it’s not surprising that due to the COVID-19 pandemic, 55% of people are more likely to pay contactless.

Insider Intelligence’s Mobile Banking Competitive Edge study uncovered that 89% of respondents – and 97% of Millennials – said they used mobile banking. And it’s not just younger generations that trust tech over traditional banks: 91% of Gen Xers and 79% of Baby Boomers mark the benefits of digital banking.

Speaking of generations…

What is the target audience of mobile banking?

Millennials and Gen Zers, used to managing their financial affairs mainly through mobile apps, are coming to the fore. During a typical month, Millennials in the US alone access their bank accounts 8.5 times via a mobile app (versus 3.1 times for non-Millennials). When it comes to opening a credit card account, 61% of Millennials opt for going digital. 

The Millennial takeover of the banking sector is expected to happen between 2025 and 2035, while the wealth of Baby Boomers and Gen Ys will decline, respectively. But while the two tech-savvy generations determine the global course of financial systems, currently, only a few banks have the tech background required to cater to them.

What can the future of mobile banking application development look like under the mobile-first Millennials’ rule? They say the shift will bring a more customer-centered approach, a connected world, frictionless operations, and a smart move for utilities.

Knowing mobile banking app trends and users is an important starting point, but it’s time to head over to more serious steps. Start thinking about the functions you want in your application.

Mobile banking app features to have in 2021

Don’t pass on the features that create the core of mobile banking software development. 

Authentication and authorization flows

Multi-factor authentication (that asks users, “Who are you?”) is a secure sign-in option. Authorization (that asks users, “What are you allowed to do?”) is the next step for login, resolving what users can do and see in your app. To deliver a top-notch user experience, apply biometric authentication, covering physical user metrics like fingerprints, appearance, voice, and even gestures.

Account management

Help users see bank balance, track spendings, record history, and analyze habits. You can go even further by offering people to set saving goals, create investing plans, and automate regular payments.

Customer support

Ensure clients can reach out to customer support managers 24/7 to resolve issues. What’s more, you can enhance the user experience by adopting an artificial intelligence chatbot.

ATM/Bank branch locator

To ease the lives of your customers, enable searching for ATMs and branch locations nearby with information on the services provided, operating hours, and directions.

Secure payment and transaction processing 

All in-app payments and transactions processed should be secure and available anytime, regardless of location. Adding QR code payments is also a good idea.

Push notifications

Keep customers informed on the go by sending banking alerts on account updates. But push wisely and don’t be intrusive because your messages can get lost in the “data noise” and annoy users out of using your app.

Advanced mobile banking app features

To ride the tech wave (and become irreplaceable), you can deliver some of these innovative mobile banking features when designing for fintech.

Expense trackers

Having your money situation under control is always a good idea. Help people stick to their budget and save more money. Consider splitting periods into daily, weekly, monthly, and yearly options.

Cashback services

As for 2021, mobile e-commerce is forecasted to reach $3.5 trillion and make 72.9% of e-commerce sales. Seize the day with the cashback function. A perk like this will encourage bank users to make in-app payments. On top of that, cashback comes in handy as a solid background for your loyalty program.

Personalized offers

Special offers, discounts, and coupons can help build personal relationships consumers value and trust. They will definitely drive more clientele and increase sales.

Unique services

Mobile banking app development can cover other non-obvious offerings too, including buying tickets online, car booking, reserving a table at a restaurant, ordering delivery, and more.

App for wearables

Wearables can enhance the way people live, exercise, and bank. It’s worth considering the given potential to display banking information, deliver alerts, and enable payments or transactions using wearable technology.

Bill-splitting 

The bill-splitting feature allows dividing bills and assigning each person their cost down to a cent.

Chatbot or voice assistant

For both informational and transaction purposes, voice-powered digital banking chatbots are the cherry on top to provide compelling, advanced, and conversational user experiences.

Blockchain

Blockchain has stepped far beyond cryptocurrencies. The finance sector is using blockchain thanks to the improved speed, accuracy, and security it delivers.

Cardless ATM access

Allow your bank users to withdraw cash even if they don’t happen to have the card on them. Instead, require account verification through a text message or a banking app call on their smartphone.

Prepare for 5G

5G is coming to town. Now’s the time to research new markets and channels, covering wearables, 5G smartphones, and IoT devices.

Undoubtedly, the features of mobile banking are the primary criteria for using or ditching an app, so make sure to use them wisely.

Main banking app development challenges

Security concerns lie among the most important challenges banking app developers must take into account. 

Security

Follow these five proven ways to mitigate the risks and vulnerabilities of banking apps and protect customers from emerging threats.

KYC compliance

KYC stands for Know Your Customer, Know Your Client, or KYC check. The KYC process refers to verifying your customers are who they claim they are (and that they are not likely to be engaged in organized crime), as well as assessing and monitoring risks. KYC procedures help limit fraud, prevent and identify money laundering, terrorism financing, and other corruption schemes through Proof of Identity (POI) and Proof of Address (POA).

Some commonly accepted POI examples include passport, national ID card (Estonia, Georgia, Greece, Central African Republic), Aadhaar (India), NIDS (Jamaica), DNI/SIBIOS (Argentina), SIN/SSN/driving license (Canada, the U.S., Denmark, New Zealand, Iceland, the Netherlands), HKID (Hong Kong), photo ID, student ID, military ID, arms license.

POA documents must contain the individual’s name and current address and not be older than the last three months. As a rule, individuals have to submit some of the following documents: utility bills, current passbook or bank statement, the notary proof of residency letter, election commission ID card, house purchase deed, lease agreement, employer’s certificate.

The banking sector must strictly follow KYC regulations, which are part of an anti-money-laundering (AML) framework; otherwise, they can be charged severe fines and restrictions. 

Strong passwords

Require users to create sophisticated and unique passwords. You can also demand to change their passwords after a certain period.

Don’t store unnecessary information

Keeping unnecessary business data is like playing a cybersecurity roulette. Keeping too much information without a legal or business reason multiplies the risks of data security exposure. But tracking IP addresses, geolocation, in-app events, activity logs, and device data is entirely different.

Two-factor authentication

Two-factor authentication (T-FA or 2FA) is a way to verify that your clients are who they claim to be. For increased mobile banking security, 2FA often combines a password, pin, smart token, mobile signature, or biometrics.

Payment blocking

You can also address fraud by setting blocking to limit the use of payment cards to suspicious channels or specific situations. Enable 2FA to unblock these transactions.

Regulations

Launching fintech software development requires compliance with many laws, standards, and regulations. Let’s uncover some of them:

• GDPR. The General Data Protection Regulation (GDPR) lays down the rules for protecting personal data in the EU.
• PSD2. The New Payment Services Directive (PSD2) promotes the development of innovative online and mobile payments, more secure payments, and better consumer protection across the EU and EEA.
• PCI DSS. PCI DSS (Payment Card Industry Data Security Standard) maintains, evolves, and promotes Payment Card Industry standards for cardholder data safety across the globe.
• CCPA. The California Consumer Privacy Act (CCPA) is intended to enhance privacy rights and consumer protection for residents of California, USA, giving more control over the personal information that businesses collect. 

Now that we’re done with theory, let’s get down to the development.

A step-by-step guide on mobile banking development

Step 1: Conduct research and make a plan

Knowing your competitors, market state, development trends, who your users are (their needs and why those needs are important) is essential to develop a unique value proposition/business model.

Step 2: Build and verify a prototype

To bring your idea to life, first, you need to create a prototype illustrating the app’s logic, structure, and order of design elements, visuals, and content. What’s more, fixing a design flaw while prototyping is ten times cheaper than making changes during the development process. 

Step 3: Lay the groundwork for security

The best way to keep your app secure is by introducing DevSecOps into the development process and working with a team that knows about the most popular threats (like OWASP’s top ten vulnerabilities) from experience.

Step 4: Design the UI and UX

According to the best practices in banking app UI/UX design, you should deliver a personalized customer experience, make the account useful and helpful, strive for ease of use, and ensure the overall app is transparent and safe. 

Step 5: Choose a technology stack

There is no one-fits-all stack for web or mobile banking development since every project has its characteristics. Still, a wisely chosen tech stack will help lower costs, shorten software development time, and speed up the time to market. 

Step 6: Code the app

You can implement the app with an in-house team or work with a software development outsourcing vendor. The first approach works if you have the time and budget to hire banking software development professionals. But if you need to start the development quickly, opt for competent banking app developers who work for experienced vendors.

Step 7: Integrate with third-party solutions

Data integration best practices provide your app with external features instead of building them from scratch. 

Step 8: Release and maintain

Application release is the most breathtaking and rewarding stage of the entire journey. But only if you have professionals on your team or partner with vetted banking app developers. They will help you polish your app and prepare for publishing it on the App Store and Google Play.

Step 9: Market your app and get feedback

Google Play Market, Apple’s App Store, and Microsoft Store have different requirements banking app developers must follow so that your app submission goes smoothly. Once the app is published, first feedback, ratings, and stars are to come.

Step 10: Improve and update

It would be great to reach out to your audience for valuable feedback, collaborate with review sources, ask influencers and opinion leaders to test (and then promote) your app. Put as much time and effort into improving your app as necessary.

Best technology stack for mobile banking app development

Remember how we mentioned the importance of the right technology stack? Well, here are the tools and technologies we at Relevant recommend for mobile banking app development. 

Native app development

If you create a banking app solely for iOS or Android, you should opt for native app development. When it comes to iOS-based mobile banking software solutions, the best technology includes Swift, XCode, and iOS SDK. If we’re talking about Android-based mobile banking development, then Java, Kotlin, Android Studio and SDK are the tools of choice.

Cross-platform app development

Cross-platform app development is a winning approach that allows banking app developers to use a single code base for different operating systems. React Native, Flutter, Xamarin will aid in building cross-platform apps.

Hybrid app development

Hybrid mobile apps blend native mobile app development and web development. They are usually built using HTML5, CSS, JavaScript, and PhoneGap and then run inside a container, making it possible to be embedded in native apps.

How much does it cost to develop a mobile banking app?

There is no exact answer to the question. Mobile banking software solutions vary in terms of scope, complexity, technology, and urgency, all influencing the final cost. Some of the factors affecting the realistic budget include: 

• Work breakdown structure (WBS) for mobile banking application development
• Technology stack
• Expected deadlines
• Engagement framework: fixed price, time and material, dedicated team, team augmentation, or outstaffing
• API integration services

It may take from six to ten months to build an MVP. The exact duration depends on whether you need a small project with minor updates to your current application or a complex one with custom banking app development from scratch. The more mobile banking app features you need, the longer it will take to develop them.

Let your users bank on their terms

Digital disrupts the nature of the core banking system. While building a successful and secure mobile banking software solution requires a lot of effort, the market is open to new challenges and a frictionless financial experience.

All you have to do is to stick to your plan, plan a realistic budget, and partner with a team of banking app developers who really know what they’re doing. Don’t hesitate to contact us to discuss mobile banking application development in more detail.