How to build a mobile banking app

Mobile banking’s fledging iteration in the 1990’s was conducted via handsets’ Short Message Service (SMS). The offering was limited and inflexible – customers could check their balance or request
to be warned if they were about to become overdrawn. By 1999, the world’s first Wireless Application Protocol (WAP) enabled mobile banking services in Norway. This soon spread, opening greater opportunities for banks to serve their customers on-the-go.

The invention of the smartphone in the late noughties, however, was the real turning point – giving customers access to online banking services via web browsers on their handsets. This is also when banks began developing their own bespoke apps. The first
offered in the UK was from RBS in 2011 and was available on iOS. Today, the number of digital banking users has exceeded 3.5 billion and is likely to surpass

50% of the planet’s population by 2026.

For those institutions still looking to set up, or replace, a mobile banking application, here is a simple plan of attack.

Build-a-banking app: The 10-step plan

1. Identify your objectives

The banking app is best thought of as an answer to a customer challenge or a set of business needs. Whether it’s to do with streamlining workflows, boosting customer engagement, or increasing competitiveness, once the app’s objectives have been identified,
research can be done into how each can be met most effectively.

2. Decide on the requirements

With the goals defined, the list of requisite functionalities and technical requirements is drawn up. Are there any integration, security or scalability considerations? What features will be baked in? How will they be linked?

Classic functionalities might include authentication, account management, user profiles, transaction history, integration with digital wallets, ATM and bank branch locations, push notifications, and 24/7 support. With a greater budget, more innovative or
complex features may be considered, such as
Quick Response (QR) code scanners, savings trackers, social sharing options, e-signatures, cryptocurrency support, dynamic currency conversions, or even gamification.

3. Select a development approach

Now the blueprint is set, an approach should be agreed. Will the app be native and developed for specific operating systems, like iOS or Android? The benefits of this include high performance and use of the device’s features, though a separate development
will need to be run for each system. This would drive up the project’s cost.

The way around this would be to opt for the hybrid-app approach, which benefits from a single codebase for each system. The downside is that performance becomes limited – perhaps not the best option if boosting customer experience was the original objective.

Often the cheapest option – and with the greatest potential for customer adoption – is the web-based app. Customers can easily access these services via their browsers, with no installation required. The drawbacks to this approach are reduced UX and access
to device features.

4. Choose a stack

With the operating system, scalability and security requirements established, a technology stack can be landed on. In his Finextra article, ‘Enterprise Mobile App Development
– A Complete Guide’, Ankit Patel, XongoLab Technologies’ marketing and project manager, provides a simple spread of the classic choices for each system:

• iOS: Swift, Objective-C
• Android: Kotlin, Java
• Hybrid: React Native, Flutter, Xamarin
• Backend: Node.js, Express.js, Ptthon, Django, Ruby on Rails
• Database: MongoDB, MYSQL
• Frontend: React, Angular, Vue.js, Flutter or React Native

5. Design a UX and UI

Designing for user experience (UX) and interface (UI) is arguably one of the most important steps yet. It can be the difference between high or low adoption – success or failure of the original objective.

A grand science goes into app design, which can impact end-users’ behaviors and interactions with the software. Forbes’

‘The Science Behind UX Design’ is a surface-scratching start – touching upon the importance of control, F-Patterns, Hick’s Law, and more.

6. Develop the prototype

The development stage – the point at which plans are pushed into action. First comes the code-writing phase, then a working model of the app. Expect this iteration to undergo many changes in the name of optimal functionality.

7. Test, test, re-test and debug

A robust testing regime is what produces banking apps that meet and exceed functional objectives. Tests may be run for bugs, multiple device compatibility, speed, responsiveness, scalability, authentication, security, compliance, and more.

There are many schools of thought around stress testing. For a rifle into the world of chaos engineering, see Finextra’s article, ‘Chaos engineering: The art of failing
gracefully.’

8. Deploy the app

Once all bugs are fixed, and the UX/UI is smoothed out, the application can be launched and distributed – be it via app stores, direct downloads, or internal systems. Uptake, user reviews, and progress toward original business goals are all metrics that
should be measured and managed. 

9. Maintain the app

With end-user responses and the app’s effectiveness in mind, updates should be undertaken constantly. Bugs will arise, which need to be fixed in order to minimise reputational damage. The best recourse is to have in place a dedicated team or third party
to address such concerns around the clock.

10. Update the app

There may be a juncture that is reached which requires the app to be changed, overhauled, or updated, to steer it back toward the desired goal. Plan for the possibility of needing to introduce a raft of new functions, features or security measures, as the
winds of consumer expectation, technology and competition change.  

Final considerations for app-building

• Budget: According to
  Qarea, if you choose to build a simple app that offers basic account management features “expect the cost to range from $50,000 to $100,000. For a more feature-rich application with additional functionalities and advanced security measures, the development
  cost can be anything from $100,000-$500,000,” or more.
• Security: The safeguarding of customer data is non-negotiable. Cyber-attacks of UK institutions are on the rise and must be
  planned for. Look to encryption, two-factor authentication, and regular security audits as a defense.
• Integration: Does the mobile app seamlessly integrate with incumbent infrastructures? Cross-platform compatibility is key too. A range of devices and operating systems are deployed in large organisations.
• Scalability: The app should have the flexibility to flex with time – as user numbers, features and data rises.
• Adoption: How will customer usage be driven? This largely comes down to the success of the UX and UI design, as well as marketing and staff training.
• Consistent feedback: By regularly monitoring customer reviews, and reacting to them with on-the-ground updates, the app will remain useful.

What’s in it for banks?

The development blueprint is laid out. The budget is dedicated. But beyond a closer and more sustained relationship with customers, what’s in it for banks?

As Patel points out, “in today’s technology-driven world, mobile apps have become the backbone of modern enterprises. Companies are no longer limited to traditional software solutions; they are leveraging mobile applications to drive productivity, streamline
operations, and stay connected with their customers and employees.”

Indeed, there are endless returns for institutions willing to make the investment. As well as boosting engagement, banks can expect to reduce overheads, expand their reach, leverage data for smarter business decisions, sharpen their competitive edge, streamline
flows and operations, and even enhance compliance processes.